Dubai: Winning people’s hearts and minds through incentives is crucial to building a long-term commitment to sustainability and green practices.
But the stick is easier to use and works faster.
“If you really want to move people’s behaviour or consumption in a specific direction, you cannot go about it without taxation,” said Finn Mortensen, executive director of Danish public-private partnership State of Green.
“It is a carrot-and-stick game,” added Adnan Merhaba, principal of international management consultancy Arthur D. Little. “The carrot can work but the time it takes is typically much longer. The stick angle works a little bit quicker. It hurts you now, you’re going to change your behaviour today.”
The pair were speaking on a panel discussing the role of legislation at the World Green Economy Summit at Dubai World Trade Centre on Tuesday.
Winning hearts and minds, Merhaba said, is “probably the most difficult aspect. [The public] is the most difficult stakeholder to address of all the stakeholders involved in climate change.”
Mortensen said that when motivating people, money talks, and ensuring green options were cheaper would have an effect.
“That is a key driver, I think, when it comes to private consumers.”
Fellow panellist Hussain Khansaheb, director of International Cooperation at the UAE’s Ministry of Climate Change and Environment, advocated a softer approach.
Financial penalties would not help the UAE achieve its goal of increasing recycling to 75 per cent of generated waste by 2021, since the country did not charge for waste collection, he said.
“We are working on that by incentives, we are working on it by awareness, by providing the facilities to encourage recycling. The same thing with carbon emissions.”
Kim Sang-hyup, chairman of South Korea’s Coalition for Our Common Future, said carbon taxes, as in Denmark, or carbon trading, such as in South Korea, were “the ultimate solution.”
“There are various policy measures, of course. You can introduce new subsidies for electric vehicles. You can add R&D for clean technology. There are a lot of things. And you can add penalties for certain emissions. But if I had to choose one effective, powerful policy measure that would be putting a price on carbon. That is it.”
Whatever policies were adopted — and Mortensen conceded that although taxation worked for Denmark, there was no one-size-fits-all solution — the panel agreed that long-term green policies had to be insulated from political expediency or changing of governments. Merhaba cited the Trump administration’s stated intent to withdraw from the Paris climate agreement.
“It’s not just Trump and the US — Australia is also reneging on some of its commitments, and as the rise of nationalism spreads across the world, I think quite rapidly the risk of regressing back on some of these policies goes up,” he said. “I think decoupling or delinking [decarbonisation policies] or institutionalising in such a manner that the change in regime or the change in politics has little or no impact is important.”
But there, perhaps, is where the carrot proves more effective than the stick, and the long-term, difficult task of winning hearts and minds pays dividends.
Merhaba praised Sweden’s long-term commitment to green policies, and Mortensen highlighted his native Denmark, which began the greening of its economy following the first oil crisis in the 1970s.
“We simply had to do something,” he explained. “The government had to intervene. One of the strongholds of the Danish system is that when it comes to legislation we have a decades-long tradition of broad political agreements when it comes to taxation, housing, schooling, energy also. So if you are an investor in energy you can rest assured that any energy agreement will still stand even if there is a change of government because the opposition has signed on to it.”
Even in the US, where the federal government had changed its mind with a new administration, Merhaba said individual states and cities remained committed to green policies.
Furthermore, Merhaba, said, even though carbon taxes were more effective and cheaper to administer than legislation, taxes remained unpopular, leading politicians to favour regulation.
