Select Committee on Environmental Audit Appendices to the Minutes of Evidence


Memorandum from The Confederation of British Industry (CBI)


  1.   The CBI represents businesses operating in the UK, who collectively account for approximately 40 per cent of the UK workforce. Our membership is drawn from across a wide range of sectors (including manufacturing and services) and a wide range of company sizes, from SMEs to major multinational enterprises.

  2.  The CBI mission is to promote the conditions in which businesses in the UK can compete and prosper. A key area of our activity is to ensure that public policy contributes positively to this mission.

  3.  National and international public policy on sustainable development is also an important element of CBI work. Our activities range from commenting on individual policy proposals, to informing public debate (eg through surveys, position papers), to playing a key role in developing leading edge policies (eg on emissions trading) and practical applications (eg on reporting and benchmarking corporate environmental performance).


  4.  The World Summit on Sustainable Development ("Rio + 1 0") takes place in August and September 2002 with a remit to review the progress made since the "Earth Summit" which took place in Rio in 1992, and to accelerate the implementation of commitments made then. Business welcomes the fact that the summit is to focus on "action-orientated" issues. However there is concern within the business community that the summit will be diverted from this focus and revisit individual agendas around intractable problems.


  5.  For UK business sustainable development is about ensuring a better quality of life for everyone, now and for generations to come. The World Summit should focus on how society can deliver prosperity to a greater proportion of the global population. The agenda at Johannesburg should reflect the need attain development that is sustainable.

  6.  Business is aware it shares the responsibility with civic society and government for ensuring that development becomes sustainable. UK business suggests that the following principles should underpin UK Government thinking on the summit.

  7.  There should be a move away from the purely reductionist interpretations of sustainable development which focus simply on reducing levels of production and consumption. For there to be real improvement in the quality of life for vast numbers of the global population the situation demands an increase in production, not a decrease. To achieve progress changes must be made in the nature and patterns of production and consumption rather than in their relative levels.

  8.  However it is clear that business should continue to reduce its dependence on hazardous materials in favour of the more benign and increase the (re) use of materials from renewable sources. Government has a key role to play in facilitating the development of a more effective market in these materials.

  9.  We believe that healthily growing business is fundamental to the delivery of sustainable development. Improved, smarter risk-based regulation has an important role to play. We welcome the Environment Agency's initiatives in this direction and are keen to play a role in their further development. A transparent and equitable regulatory system and other conditions have to be in place to enable business to develop, such as sound governance within the workings of civil society, including rights to property, education and freedom from corruption. Without these neither business nor society in general can function to its full capacity.

  10.  A most effective motivation for sustainable development is the market. It is the business view that sustainable development is facilitated through open and competitive markets that encourage efficiency and innovation. Markets engender sustainable development through:

    —  Wealth Creation: the market system is a tried and tested means of ensuring economic growth and wider prosperity.

    —  Competition: plays a vital role in driving business towards resource-efficient provision of goods and services provided it is transparently regulated.

    —  Choice: empowers consumers with the freedom to choose how to enhance their quality of life.

    —  Innovation: clearly there are is requirement to find new ways to deliver our needs, new approaches to existing problems as well as new ways to do deal with future challenges. Markets encourage such innovation.


  11.  The last decade has shown that business is committed to working in partnership with Governments and Civic Society to facilitate the shift to make development more sustainable. (Recent UK examples of such partnership approaches include the UK Emissions Trading Scheme, Project Acorn, Groundwork and projects under the landfil tax credit scheme. An international example would be the Global Reporting Initiative).

  12.  CBI applauds the UK Government for setting up the five sectoral initiatives to inform the UK input to the Summit process. CBI feels that it is vital that business must be fully engaged in the summit process. Experience has shown that business is most effectively engaged on a sectoral basis. It is on a sectoral or even individual business level that commitments can be made, targets set and performance monitored. At a national level the Government has played an important role in supporting this approach with the DTI Sustainability Pioneers Group. Internationally the ICC and World Business Council for Sustainable have supported a number of sector specific initiatives (ie in the cement, electric utilities, forestry and mining sectors).

  13.  CBI has engaged with UK Government officials about formalising UK business involvement in the summit. While these discussions are at an early stage, it is clear that there is the will and commitment on both sides to come up with a coherent stance for the summit.


  14.  The Rio summit had the effect of galvanising the principal actors around a number of key issues. It also placed the issue of climate change fully into the public consciousness. The Johannesburg summit should aim to have a similar effect, propagating a wider understanding of the concept of sustainable development.

  15.  While there is no fixed agenda for the summit, business welcomes the agreement that the outputs from Rio eg Climate Change Treaty, biodiversity, Agenda 21 should not be renegotiated in Johannesburg. Rio + 10 will be a failure if it becomes nothing more than a repeat of the arguments of Rio, at the same time business does not view Johannesburg as the place to create additional Multilateral Environmental Agreements (MEAs). Efforts should concentrate on progress made and outcomes (not merely outputs).

  16.  As with all involved in the summit, business wants it to be a meaningful dialogue that engages all the relevant stakeholders. The UK government should use its influence to ensure that tangible and action orientated initiatives that are realistic to be implemented in specific business sectors are an outcome of the summit.

  17.  It is clear from the preparatory meetings that eradicating poverty and promoting sustainable livelihoods will be central to the final summit agenda. To facilitate the delivery of these aims the summit should concern itself with delivery and implementation in the following key areas:

    —  Finance is an extremely problematic issue which must be tackled at Johannesburg. Business is concerned that the current financial arrangements are too bureaucratic and have led to limited financial sector involvement. Indeed CBI would also like to see clarification on the role of the private sector, and the use of new approaches such as mini and micro finance and public private partnerships. Business would also like to see movement on the issue of perverse subsidies such as the Common Agricultural Policy.

    —  Technology Transplant: The use of public private partnerships (in the broadest sense) should be explored as a means for improving access to, and transplant of, environmentally sound technologies, such as: Joint Implementation and Clean Development Mechanisms which make up part of the Kyoto protocol. Also market based policy instruments should be used to stimulate the development of new technologies and accompany the culture change required, with attention to specific financing for small and medium enterprises.

    —  Trade: An open and equitable system of world trade is vital to sustainable development, the summit should use the momentum generated at The WTO Ministerial in Doha to clarify the relationship between WTO rules and existing MEAs. The summit should encourage the removal of trade distorting and environmentally detrimental subsides.

February 2002

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