Can there be capitalism in an ecological sustainable society?

Graduate School of Social Science

Master thesis course:

Alternatives to Capitalism: Models of Future Society

Can there be capitalism in an ecological sustainable

society?

Name: Aleksander Egeli

Student Number: 12182753

Date: 21.06.2019

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Table of contents

1.2 Research Motivation and Goal ... 6

1.3 Research Question ... 7 1.4 Research Outline ... 7 2. Capitalism ... 8 2.1 Classical capitalism ... 4 2.2 Modern capitalism ... 4 2.3 Kuznets curve ... 4

3. Ecological Sustainability and Sustainable Development ... 8

3.1 Ecological Sustainability ... 4

3.2 Sustainable Development ... 4

4. United Nations Sustainable Development Goals ... 5

4.1 The Road to the Sustainable Development Agenda ... 4

4. The 2030 Sustainable Development Goals ... 4

5. Analysis ... 5

3.1.Short termism ... 4

3.2 Minimal government intervention ... 4

3.3 Growth ... 4

3.4 Green capitalism ... 4

6. Discussion ... 5

7. Conclusion ... 5

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Acknowledgements

I would like to thank my supervisor Dr Paul Raekstad for providing me with a solid foundation to take on challenging and complex questions raised in this thesis. His support and guidance gave my amazing

classmates and me the opportunity live up to our potential. I am grateful to be able to work side by side with a bright group of students and Dr Raekstad.

This thesis would never be what it is without the extension research carried out by others in the past. The legacy of great individual pioneers and scientist is distinct throughout the thesis. They all deserve all tribute for devoting time and energy on research that is still relevant today. Finally, the University of Amsterdam and the Graduate School of Social Science deserves praise for the outstanding program in Political Science. All involved deserves acknowledgment for the work that is being laid down to maintained and improve the high standards at the university.

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Abstract

This thesis look into the relationship between capitalism and the

environment by examining three key characteristics of modern capitalism and the UN sustainable development goals concerning ecological

sustainability. The objective is to understand and explain whether there can be capitalism in an ecological sustainable society. The UN sustainable development goals is used to avoid a more broader capitalism versus environment research. That gives me the opportunity to always refer and keep in mind the actual target set to by achieved in 2030. This is an ongoing process and the thesis aim to explain why and where capitalism might causes problem to achieve goals and targets agreed upon by member on the United Nations. Results from this thesis suggests that capitalism partially must be held accountable for delaying the crucial development to implement necessary changes.

Keywords:

Capitalism, Short-termism, Environment, Ecological Sustainability, Sustainable Development, United Nations, SDG 2030

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1. Introduction

1.1 Introduction

Climate change and ecological sustainability is among the most important challenges this decade for humankind. It will without doubt change our way of life even though the effects and consequences of global warming is still uncertain. The road to economic growth and wealth since the industrial revulsion might have been the start of the destruction of our earth. Regardless of the debate over effects and consequences of climate change, the solution to these issues will seize enormous resources from society in the foreseeable future. This change our way of living whether or not we chose to prevent the predicted results of climate change. In the 2000s, many organisations such as the EU increased the dimension and urgency of climate change response and this has since then been high on the priority list of challenges that must be addressed.1 Many solutions have been proposed to halt and slow down the speed of which the climate change is happening, but questions have been raised about the

implementation. Countries, institutions and organisations have set goals and target in an attempt to make different actors commit to change. One of the most important actors on the international stage is the United Nations (UN). After concerns was raised in the 70s and 80s about human impact on the environment the UN through the Brundtland Commission published Our Common Future in 1987 which recognized that the earth had environmental-limits and that human caused changes was occurring.2

A year later The Intergovernmental Panel on Climate Change (IPCC) was

1 _{Nugent (2010). 344.}

2 _{WCED (1987). Chapter 6. 6.3 A call for Action. Paragraph 122. The}

commission acknowledges that the rapid humans development had unintended consequences on the earth and that these must be recognized – and managed.

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established and have since “provided policymakers with regular scientific assessments on the current state of knowledge about climate change”.3 This was the start of the UN taking an important role as the driving force to achieve global commitments to battle climate change. The UN and its member countries have been engaged in several roles and areas

concerning climate change. This paper will look into the 17 Sustainable

Developments Goals set out to be achieved by 2030.4 The goals concerning ecological sustainability will be a part of the analysis and discussion. Adaption and implementation of these goals and targets requires massive changes in our current way of living and how we chose to organize the economic system. The economic system is an important piece in the puzzle to make the necessary changes to secure a sustainable future. Economy can simply be understood as the way society uses its scare resources and the system is a result of how people individually and collectively make choices on how to use these scarce resources in the process of achieving certain goals.5 _{This system is always changing with}

a long developmental sequence and can be seen as both an evolutionary and dialectical process.6 Capitalism today is not what it was fifty years ago and will certainly not be the same in the future. This thesis aims to identify where central aspect fails to be compatible with sustainable development. The role of capitalism can first be properly discussed after we can clarify this by establishing where and how there is

incompatibility. How governments and policymakers should govern and influence the development of the economy is perhaps not a debate as old

3 _{IPCC (2019). History of the IPCC.}

4 _{UN (2019). About the Sustainable Development Goals.} 5 _{Bishop (2016). 1-2.}

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as the state itself. However, as the economy has become a central part of society and not just a personal matter, the subject have been fiercely debated. Many have brought forth opinions and contribution to this question, from Karl Marx to deregulations movements in the 70s.7

Government interventions and regulations of the economy might be a part of the solution as well as an obstacle to transit into a more sustainable society. Our capitalist economy might be long overdue for a change, but before governments can take actions, the issues and problems of our current economic system must be identified. Change or abolishment of our current economic system requires examination and assessment to reveal compatibility and contradictions before we can decide and speculate on the role of capitalism on the road to a more sustainable society.

1.2 Research Motivation and Goal

Capitalism’s ability to self-destruct has been pointed out by many through the years and the wave of critics against capitalism is again on the rise. Many sees the destruction of our planet as an inevitable result of

capitalism and consumerism. Recent calls for more and rapid sustainable development have made many question whether or not the transition to a sustainable society is compatible with capitalism. The future of capitalism might be uncertain, but abolishment or not, changes to our way of living must be done and changes to our economic system is a part of the solution. By looking closely into how our current capitalist system is compatible and incompatible with the UN Sustainable Development

Goals I hope to accentuate if central components of current capitalism

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that is a clear contradiction to sustainable development. That being said, I also expect there to be parts of these components of capitalism that in no way prevents us from adapting into a more sustainable society.

Altogether, this should end up a clear guideline to detect where our system is failing which I hope will be a valuable contribution to determine whether we should fix capitalism or simply throw it away.

1.3 Research Question

Our economic system is an important foundation of modern society and is therefore an important component on the journey ensure that the

sustainable development agreed upon in the UN is achievable. Goals and targets must be set out to be achievable within our current economic system, unless radical changes of our economic system is a part of the solution. Determining whether goals and targets are compatible with the current economic-system is a valuable and necessary insight to both set goals and later achieve them. The question of this thesis is:

Can there be capitalism in an ecological sustainable society?

Should the selected ecological goals be incompatible with our current capitalist economic system the radical changes are potentially needed to have any chance at all take a step towards sustainability. The UN and its member states must also recognize the scope of changes to our economic system that might be needed to achieve the goals agreed upon. This might require tremendous changes for individual, businesses and government, but inconvenient truth about capitalism must be exposed to prepare and conduct changes.

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1.4 Research Outline

The first part of the paper will be the theoretical foundation of the analysis and discussion. The second chapter will be dedicated to our capitalism. This chapter will provide a brief introduce to classical and modern capitalism following with three key characteristics of our current capitalist society. It is important to determine and define the key aspect of our current capitalist society to later assess how they are compatible or incompatible with the selected UN Sustainable Development Goals. The third chapter gives an introduction to ecolocial sustainbility and

sustainable development. Even though this paper mainly focus on the modern term sustainable development established after the Bruntland report, the modern definition of the term did not just magically appear. This will be clarified before I move on the present the chosen UN

Sustainable Development Goals. The fourth chapter will try to provide

insight into the UN and its past and present work on sustainable development. I will also present all the UN Sustainable Development

Goals and argue why I limit myself to a few of these. The fifth chapter

analysis is divided into subchapter which individually looks into how the earlier presented UN goals is compatible with short-termism, minimalist government and growth. A last subchapter I dedicated to establish and understand the similarities as well as differences between the

characteristics of capitalism previously look into. The sixth chapter will give a brief statement of the finding in the analysis and try to explain the implication this might in the future. The seventh and last chapter will summarize the most important and central parts of the thesis.

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2. Capitalism

Capitalism is, for now, still the winner over the battle of ideology and “isms”. Although recent events such as the financial crisis in 2008-09 caused a significant dent to reputation of capitalism, the economic system is for now the only alternative for many people8. However, more and more people are questioning capitalism ability deal with pressing issue of climate change. How did we get here and what are the most

characteristics of capitalism today? The scope of this thesis limits how thorough and deep I can answer this question. The following chapter will present some aspects of capitalism, in the past and present. Questions and observatories will be made in the chapter that I will later return to in the analysis in chapter 5.

2.1 Classical Capitalism

Adam Smith’s The Wealth of Nations that was published in 1776 was perhaps the first attempt to establish economics as an own discipline of science.9 The book came out long after several important economic inventions such as accounting, stock exchange and debts, but it is still consider one of the most important contributions to classical economics. Adam Smith was one of the first to give exceptional observation on how capitalism and the market can coordinate the behaviour of countless people. For Smith, the market is an institution or social mechanism. The best possible resource utilization, lowest possible prices and highest possible wages are achieved through the market's free competition, price system and the opportunities for profit and loss10_{. Many of the ideas}

raised by Smith was the start of a new way of understanding the economic

8 _{Bishop (2016). 57.}

9 _{Graeber (2014). 44.}

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system and society. Later scholars raised questions about the determining of prices and the just price of a good. It was clear that the market would determine prices on the principle of supply and demand. It became clear that it was not the responsibility of the market to include social benefit or cost for society11. Capitalism does not produce for human or nature's needs, but seek profits and increased returns. Today we often refers to it as market failure when a price do not reflect the actual cost of the good. This becomes a problem when the pursuit for profit causes harm to human or nature. This is what we referee to as a negative externality. Externalities and other imperfections are result of many transactions and it is virtually impossible to eliminate all externalities. Because of the increased concerns about the environment, the debate over negative externalities is stronger than ever.

The idea of capitalism and the economy having intended and unintended negative consequences is not a modern invention. Thomas Malthus came out with Essay on the Principle of Population which might be the first famous economic doomsday prophesy where he claimed that

overpopulation would lead to chaos and misery. 12Malthus was worried about the fact that increased population would led to increased demand and consumption of food, which would be impossible to supply given that

11_{Scott (2012).}

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the production of food increase enough to keep up with the population growth.

Malthus catastrophe curve

Malthus formulated an economic law, which states that the population multiplies faster than the amount of food can be increased. He used a speech example to illustrate the law: the population of a country tends to double every 25 years. Then it follows that the population will increase in geometric progression, ie 1–2–4–8–16 etc. The food supply on the other hand increases in arithmetic progression (1–2–3–4–5). If people did not limit the number of children, the population would constantly push against the nutrient base and be kept down by high mortality due to malnutrition, epidemics and war13. This pessimistic doctrine gained general support at the beginning of the 19th century and formed a cornerstone of contemporary socioeconomics. Danish economist Ester Boserup later challenged this and claimed that the population would

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instead find methods to increase food production such as increased labour, machinery and fertilizers14. A study from 2007 on farming in the Ivory Coast found that both Malthus and Boserup are right and the two theses coexist rather than contradict each other15. The debate is relevant today and we can easily draw parallels to the contemporary sustainable development debate. Similar to Malthus, some claim that the current growth rate will lead to an inevitable catastrophe when it goes hand in hand with increased consumption of limited resources. Other, similar to Boserup, claim that humans will always be innovative and hence deal with the changes that might come. I will return to this topic later in the analysis.

There are many ways to understand the economic system and capitalism. I will make one important distinction before move on from classical capitalism to what I will later refer to as modern or contemporary capitalism, Scholars like sociologist Wolfang Streeck points out that capitalism has a” tendency to expand into, impose itself on and consume its non-economic and non-capitalist social and institutional contexts, unless contained by political resistance and regulation”.16 _{This is a}

broader approach to understand and study capitalism, but we can for certainly say that capitalism has evolved into more than an economic system and therefore affect many aspects of society. As Streeck too points out, the implications of this is that the study of capitalist economy cannot be left to economist alone.17 Earlier in the paper, I defined the economy as among other things how scares resources are used to achieve

14_{Turner II and Fischer-Kowalski. (2010)}

15_{Demont, Jouve, Stessens and Tollens (2007). 226.} 16_{Streeck (2012). 1.}

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certain goals. Economist bring much to the table in the process of determining economic efficiently to how resources are spent, but might not always be aware of the consequences this might have on the other contexts pointed out by Streeck. Understanding and taking into account this other contexts is important when studying the economy in

relationship with something else. Economics is one of three components to sustainable development, together with the environmental and social components. This broader approach will helps us to fully understand the complex relationship between capitalism and the environment.

2.2 Modern Capitalist Society

The end of World War II was the start of a time where governments and people could turn their attention to the economy and society. The post-war period often has a strong reference to the Cold War, thus signifying the entire period that was characterized by the Cold War from 1945 to 1989. Culturally, the post-war era is characterized by strong prosperity, protest movements and greater focus on individualism. In the years after the war, people in the US and Western Europe were afraid of an

economic crisis. There was no economic crisis, and the years of the postwar era turned out to be a time of prosperity for the people with industrialization, minor class differences, and high quality of life the majority of people in US and Western Europe. The role of the

government changed rapidly after world war two tile today. Capitalism is an economic system where wealth and means of production are privately owned18. However, this does not mean that the government does not have a hand on what is happening. The role of the government is a

controversial question, even today. The intuitional change and transition

18_{Hoag and Hoag (2006)}

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from a Keynesian economy to a Hayekian one is often highlighted as one of the most important changes since the 70s19. This drastically changed the role of the government and its inpact on the economy. After WW2 the post-war area was a time where governments had several instruments to intervene in the economy. This slowly shifted to a system and society where government intervention was almost frowned upon. A view that is still shared by many today. Many scholars have raised the question about this transition and whether or not it gave too much power to business on at the expense of democracy. This a hot topic I will not be able to include in this thesis and the later analysis and discussion will focus whether or not this transition prevents or slowest down adaption to a sustainable society. For now, we will stick to what is famously known as

“Reaganomics” which was the start of a wave of neoliberalism.

Reaganomics was a term for the market economy supported by Ronald Reagan, US President in the period 1981-1989. A similar term was used in the United Kingdom with "Thatcherism" when British Prime Minister Margaret Thatcher supported a similar market-led economy. Today Ronald Reagan is perhaps the biggest and most know system for small government and limited state involved in society20_{. This process resulted}

in the first characteristic of modern capitalism I will explore in this thesis;

the minimalist government.

As mentioned earlier, the post-war area a time of economic growth and prosperity. This area is often call the “golden age” of capitalism due to the extraordinary growth and full employment in the period from 1950 to 197021. The growth rate varied between countries and was can be

19 _{Streeck (2014). 110.}

20 _{Shantz (2016). 26-27.} 21 _{Singh (2008)}

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described a role coaster. Japans economy expanded extremely fast before it took a turn and stagnated. USA was bounding ahead in the 50s and 60s before it slowed down in the 80s22. This type of uneven growth is

hallmark of capitalism after ww2 to today. Even today, growth is in many ways how we determine if a country is successful or not.

European and American GDP growth rate 1831-200023

Financial journalists write daily about the concept of economic growth. They talk about how countries like China have an annual growth of almost 10 percent and write about how it is expected to continue to grow strongly in the economy. They often refer to things like Southern

European countries struggling to create economic growth and, as a result have great debt.But why do we really need this growth? Why is it used as

22 _{Crouch, Amsden and Coates (2001).} 23 _{Carreras and Tafunell (2006}

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one of the most important goals for establishing whether a country has a solid and strong economy?

Growth is one of the foundations of the capitalist system. Adam Smith talked about division of labor as a tool that would result in increased productivity24. Because of this specialisation, the overall productivity and growth would increase as this more effect. Today we are in an

international market where everyone is more and more productive: Chinese and Indians are increasingly producing the resources they have, and then other countries must do the same. We are developing new technology that enables us to produce more in a cheaper way and that leads to growth. Will this ever stop and where is the growth happening today? There has been a de-industrialization in the global north, where the proportion of industrial workers has fallen 18% between 1991 and 201225. But unlike many people think, we still industrialize the globe. The

number of workers in industrial sectors (factories, mining, energy etc.) increased by 46% from 1991 to 2012 (from 490 million to 715 million). On top of that, since 2004, the industrial workforce has increased faster (2.7%) than the service sector (2.6%). Globally, the proportion of workers in the industrial sectors has increased from 22% to 23%26. A firm that is operating in this growth orientated environment must in many ways grow or die. Uncertainty tied to profit rate from year to year often pushes business to aim for growth to please investors27. This pressure can make business do dissension to achieve quick and short-term growth at the expense of something else. The short-term mentally which is widespread

24_{VincentLancrin (2003)}

25_{Robert (2014)} 26_{Robert (2014)}

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in our capitalist society will be the subject of last part of this chapter. The past two paragraphs have look at capitalism and growth. It is clear that growth in many ways is the fuel to the capitalistic machinery. With this in mind, the second characteristic of modern capitalism see in relationship with the environment is: growth.

Short-termism term used when we talk about the excessive use and focus of short-term solution and goals at the expense of long-term goals28. Capitalist mechanism such as supply and demand in a free competitive market are putting pressure on businesses and many are forced into short-term decision-making. This combined with rapid changes the last decades have made it even more difficult tor businesses. Al Gore, former vice president of the United States and David Blood, a former Goldman Sachs’ Asset Manager, highlighted this to be a reason for global financial crisis in 08-09 and called for a more sustainable and long-term orientated capitalism29_{. The Norwegian one trillion dollar sovereign wealth fund, a}

fund that rarely withdraws money, is an example of a long-term investor that is found to have a stabilizing effect on the financial market due to its ability to provide access to capital in turbulent times30. Institutions such as this intuitions are important to keep in mind when we can easily get the impression that everyone in capitalism is short-term orientated. There are individuals, businesses and private as well as public intuitions that do focus on more than the next five years. Growth was highlighted earlier in this chapter as key characteristic of the modern capitalist society. We can make a distinction between short-term and long-term growth, which are easily found in all parts of capitalism. Both of which requires either

28 _{Graafland (2016)}

29_{Gore and Blood (2009)} 30_{Carolyn (2008)}

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term orientated or long-term orientated investment or solutions. It is because of the known and unknown consequenses short-term decision might have on the economy and society that Gore and Blood criticizes short-term thinking. This is a matter that I will return to in the analysis. There are many reasons why short-term thinking is so widespread today. Some have perhaps more to do with society than the specific economy system. One example is the relationship between tenure and short-termism. Frequently changing of job and increased mobility between firms is by some consider the explanation to why managers and

employees are less long-term orientated31. There is certainly not the same culture and accept for job-hopping in different capitalist countries. Japan might look different on frequent changes of jobs and management, while other country might almost encourage it if it should boost the professional carrier of an individual. This is why we must be careful to attribute all changes to our economic system and capitalism. Not everything we think is negative or bad within the modern capitalist society is necessarily caused by capitalism. Short-termism is an important feature and aspect of the capitalist society today and is therefore worth looking more into in the analysis. Is there a way to change this trend or is short-termism simply a result of capitalism and the way our economic system has evolved? Regardless of the answer, short-termism is a key characteristic of the modern capitalist society and it remains to see if this culture can coexist side by side with sustainable development.

2.3 Kuznets Curve

The relationship between the economy and the environment is not always as obvious as one might think. A useful hypothesis to illustrate the strong

31_{Mannix and Loewenstein (1994)}

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relationship is the Kuznets Cruve. The Kuznets theory on the relationship between income per capita and environmental degradation states that thee demand for environmental protection will increase when the income per capita hits a certain point. This point is what I will later refer to as the “turning point”. To put it simply; this is the point when the country and the population can afford to take care of the environment32 When income per capita is low the developing country struggles to take care of and protect the environment. As the income per capita start to rise, the population and the states are able to do adjustments that results in improved environment (Andreoni and Levinson, 2001). We can use housing and the increased living standard as an example. Once the population becomes wealthier, the people can afford better house, which requires less heating or cooling. Because of this, the energy consumption is decreasing and let us say fossil fuel is used. Another example would be someone who wins the lottery and decide to replace his or her old

Volkswagen with a brand new zero emission Tesla.

One problem with wealth in the capitalist system is that it often causes increased consumption. Many argues that this increases cash flow and illustrates growth in the economy. More consumption means more jobs. For a long time this was encouraged not just because, it contributes to economic growth, but also because many viewed prosperity and well-being as a synonym to large and ever-growing homes, better personal transport and infrastructure, improved eating habits that include more meat consumption in warmer homes and more air-conditioned homes. One a state level there are many examples where the Kuznets curve has proven not to be right. One example of a county that experience rapid

32_{Andreoni and Levinson (2001)}

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growth with the unfortunate result of worsen environment was Qatar. Income per capita increased from $29.000 in 2000 to around $93.000 in 201333.

The environmental Kuznets curve (EKC)

David Stern introduced an alternative way of understanding the Kuznets curve by adding three scenarios to the curve. This is a more

comprehensive model to understand the relationship between pollution and income per capita. Can this model better help us explain why a

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country like Qatar become one of the wealthiest countries per capita without decreasing pollution?

Environmental Kuznets curve: alternative scenarios34

To answer this question one of the new scenarios that Stern included helps us a long way. The “new toxic” curve refers to a scenario where some pollutions might reverse, other “new” pollution sources are

introduced are there explains the lack of decrease in total pollution. This was certainly the case with Qatar, which mostly became rich on fossil fuel. Oil make up most of the pollution in Qatar and this “new” pollution source can explain why the environment did not improve35. The second scenario that was included in this later version of the Kuznets curve is “race to the bottom”. In this scenario, pollution is reduced in the more developed countries on the expense of the less developed nations. This makes it harder for developing countries to reduce emission and the result

34_{Stern (2004)}

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becomes the same level on pollution on a global level36. At last, the revised EKC (also called the Kuznets curve) takes into account that recent innovation and technology. This scenario does not reject the original Kuznets curve, but suggests that the available and more affordable technology will contribute to an earlier turning point (the point where the environment goes from worsens to improving) than before37. The Kuznet curve with the three alternative scenarios shows us that what is a clear link (pollution and income per capita) can change based on how you approach the subject and what you choose to include. This is important to keep in mind as we move on from capitalism to Ecological Sustainability and Sustainable Development.

3. Ecological Sustainability and Sustainable Development

The clear connection between capitalism and the environment is now established. There are different ways of of understanding how the

environment works and which limitations we need to be aware off. When it comes to the environment, the two different perspectives use is

economical sustainability and sustainable development. The theories behind these two perspective is necessary to later in the thesis understand what the UN 2030 Sustainable Development Goals are and easier reveal how they are different from economical sustainability and sustainable development.

3.1 Ecological sustainability

The ecological capacity or carrying capacity is the upper limit for the number of individuals of a species who can live in a given area for a long time. A population changes somewhat from year to year, but over a long

36_{Stern (2004)}

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period no population can be larger than the area's ecological capacity allows because resources such as water, food and environment do not always increase with increasing population38. The livelihood and survivals of spices almost ultimately directly or indirectly dependant on nature. This is where the ecological capacity is important to determine whether or not the natural resources that being sustainable used or

consumed. When an area has been the habitat of a species for a while, the species can affect the area so that its carrying capacity changes39. For example, the beaver is dependent on trees. It uses the trees for food and to build houses that they can live in. They also use many trees to build dams around their houses. They build the dams so that the water will not destroy the houses. However, when the beaver has finished his house and they have offspring, the need for food (trees) increases. Therefore, the beaver often destroys more trees than the area manages to produce. The result is that the carrying capacity of the area decreases, and the beaver must after a while (the point where the is not enough trees) find a new area to establish itself in. In this example, the beaver’s consumption of trees is not sustainable.

Humans, like beavers, are also dependant on the earth and environment to survive. We do not only rely on trees, but all sorts of goods that earth provide us. That would be things like clean water, minerals, clean air or even animals for food. The biggest difference between humans and beavers is that should the natural resources we rely on disappear, humans do not have the option to find a new area to live. The earth is the only known planet that can support human existence. So the question is, are humans consuming too many “trees” so that future “offspring” are

38 _{Hui (2006)}

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without the opportunity to access the natural resources needed to survive? This is a hot topic that are being widely discussed among scholars. As mentioned earlier, Thomas Malthus predicted late in the 18th century that population growth would soon be so great that we could not produce food for everyone. Malthus forgot to take into account human creativity and innovation. Over the years that followed, we increased the yield of the land faster than the growing population managed to consume it.

Fertilizers, genetic engineering and tractors contributed to this. Humanity managed to avoid this predicted disaster. The recent doomsday prediction is not exclusively concerned about food (although enough clean water and food is a problem in parts of the world), but focus on a set of ways that humans are now challenging the earth’s natural capacity40_{. For a moment,}

let us return to what ecological capacity is. The ecological capacity of an area is the upper limit of how many individuals of a species can live in the area for a long time, or said in another way: the carrying capacity is the maximum number of individuals who can live in a confined area for a long time. Humans confined area is the earth and the maximum numbers of individual that can live here is still unknown. What is known is that the population on earth will grow in the near future and if we are challenging earth capacity already, then something must be done to ensure that humans on earth are ecological sustainable41. Whether or not our current capitalist society is or even can be ecological sustainable is a million dollar question in this thesis.

3.2 Sustainable Development

40_{Ananth, Sita, and Kreisberg, Joel (2011)} 41_{Painter-Morland, Demuijnck, and Ornati (2017)}

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Unlike, ecological sustainability, sustainable development is concerned with more than just the environment. Sustainable development is a development in society that meets today's consumption needs without compromising the ability of future generations to cover their needs. The term was widely known after the Brundtland Commission in 1987. The term is often used by politicians and environmental movements to justify that poverty problems and environmental problems must be seen in relation to each other, and to argue that short-term economic considerations must give way to long-term environmental

considerations42. An example of a non-sustainable development may be that you fish so much that fish doors out. This could destroy the ability to obtain food by fishing for future generations. Sustainable development can therefore mean that you fish a little less today, so you can fish in the future as well. Another example may be that people who have been unemployed and therefore poor get paid work. How to get enough money to satisfy their needs. This leads to economic growth that can benefit many. If the new jobs come in an industry that creates little pollution and greenhouse gas emissions, development is sustainable because it does not destroy the opportunities of future generations.

One of understanding sustainable development is to think of three

overlapping circles. The circles are exists alone and some even argue that one can be more important than the other ones. Ecological sustainability and the environment is a part of the environmental circle. This is why the distinction between ecological sustainability and sustainable development is important. Ecological sustainability is a part of sustainable

development and must therefore not be confused to be the same thing.

42_{Bârsan (2012)}

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The overlapping circles of sustainable development43

When we refer to sustainable development, we include social and economic aspects as well as the environment.

Sustainable development: the intersection of economy, environment and society 43 _{Thatcher (2014)}

Enviormental

Economic

Social

Enviormental

Economic

Social

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We can also use a three nested co-dependency model to understand how these factors intersect, but also depend on one another. I will use this model as theoretical foundation for understanding the importance of the environment for sustainable development. With this model, we assume that both society and the economy co-exist within the environment. This means that essentially the environment is the foundation of both society and the economy. They can only exist with the basic environmental or natural resources. If we assume that this is the case, both social and economic sustainable develop will be a waste of both time and resources are spent on the expense of saving the environment. Economic crisis, inequality or even peace on earth will that least of our worries if humans does not have access to basic natural resources required to survive. We can illustrate the importance of the environment with the following example.

The three nested co-dependency model of the sustainable development factors44

44 _{Faucheux, Pearce and Proops (1996)}

Enviorment

Society

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We can imagining a farmer in a small town that just experienced an extremely dry summer that resulted in all of his crops dying. Is this an environmental, social or economic disaster for the farmer and the

population of the town? Crops dying is clearly an environmental disaster, but it could also greatly affect society and the economy. The farmer’s inability to supply society with grain decreased the supply of food that might cause higher food prices. The farmer potentially also lost a big revenue source and he will consume less goods. This will affect other local business that usually do business with the farmer. A hypothetical scenario like this might at first look like an exclusively environmental disaster, but the co-dependence of environment, society and economy results in a potential disaster for all three aspect of sustainable

development. Co-dependence is the key when I later in this thesis investigate how capitalism affects the environment and try to answer the question whether or not there can be capitalism in an economical

sustainable society.

4. United Nations Sustainable Development Goals

The United Nations is a key player on the international stage when people and countries all around the world collaborate to take on challenges concerning the environment, economy and society. Many challenges goes beyond border and will be close to impossible to achieve without a global response. The sustainable development goals are a result of collaboration between the vast major of countries and there are several thing to keep in mind when we look at the final product. The following chapter will try to explain this through the history and current agenda of the United Nations.

29

4.1 The Road to the Sutainable Development Agenda

The Brundtland commission was on many ways ground-breaking when they first introduced sustainable developed as “development that meets the needs of the present generation without compromising the ability of future generations to meet their own needs emphasizing on principle of equity contemplating two types of equity as intergenerational equity: justice to current and future generations in relation to resource and

intergenerational equity: fairness in sharing of resources to the competing interests of contemporary time”45.The Brundtland commission laid the foundation for later, larger UN international conferences. Such a conference was the UN conference on environment and development, also called the Rio Conference because it was arranged in Rio de Janeiro in Brazil in June 199246. The UN Commission on Sustainable

Development, eng. The Commission on Sustainable Development (CSD) was then established in December of the same year. It operates within the framework of the United Nations Economic and Social Council

(ECOSOC) and has 53 Member States. CSD has held annual meetings. This work resulted in the 2000 Millennium Declaration47. Ten years after the Rio Conference, in August-September 2002, a major conference was held in Johannesburg, South Africa, under the name Rio + 10. CSD's 20th meeting was turned into a new, large UN conference in Rio in June 2012. It was named Rio + 20 to mark the anniversary of the establishment conference in 1992.

45_{Yosef (2008)}

46 _{National Assembly for Wales (2015)} 47 _{UNDP (2019)}

30

Milestones towards the sustainable development goals

So who did really set the sustainable developed on the UN agenda and have all the member state been equally powerful in this process? To answer this we must almost ask the fairy-tale question; Magic Mirror on the wall, who now is the fairest of all? This famous quote form the Disney movie Snow White and the Seven Dwarfs was the evil queens attempt to get an answer that suited her. The same would most likely be the case when you ask most countries about their part in the setting the sustainable development goals and later achieving them. All would perhaps give an answer that suited their own agenda and blame others for blameworthy realities. This is important to keep in mind when we understand the approach many countries when they take part in the UN policymaking. The UN is an organization in which all 193 member states have equal power in many contexts. This gives a unique legitimacy and is in many ways one of the UN's strengths. It is also a challenge and a weakness as various conflicts of interest can weaken the UN's power of action. Many processes are governed by the consensus principle, and it can therefore be difficult to reach agreement as a smaller group of countries exploit the

Brundtland Report

1987

1992

2000

Rio+10

31

consensus principle to block decisions48. It is in the interest of the world that the UN is able to deal effectively with the world's challenges. The UN can probably be improved in the same way so many other important institutions have potential for improvement. This is not the object of the thesis, but we must consider this to have a critical approach and

understanding for what the sustainable development goals actually is. They are not necessarily the right answer to the challenges mankind are facing or the “gold standard” of sustainable development. The goals reflect on the nations that have put them to life and it must not be taken for granted that achieving these goals would ensure the necessary changes we need. This must be taken into account and we cannot do anything but accept that reality.

4.1 The 2030 Sustainable Development Goals

The UN's sustainability goal is the world's common work plan to eradicate poverty, combat inequality and stop climate change by 2030. The decision in New York was the preliminary end to a comprehensive process in the individual member states where politicians, business and civil society have recorded suggestions and ideas. The goals reflect the three pillars of the concept of sustainable development; climate and environment, economy and social conditions. The countries' objectives up to 2030 will in particular be linked to combating poverty and inequalities and stopping climate change. When the goals were adopted in 2015, it was with a new understanding that economy, inequality and the environment affect each other to a greater extent than we previously thought. In order not to use up the only globe we have, we need to find solutions that balance the burden on the environment with our

48_{Smith, Courtney Bruce (1998)}

32

consumption and our economy, and we need to find better ways to allocate resources. With this in mind, this thesis will look into whether or not capitalism and sustainable development can go hand in hand. The earlier mentioned sustainable development models are central to how I will explore this question. The connection between the three dimensions in the model (environment, society and economics) that determines whether something is sustainable. If we assume that these three dimensions are co-dependant and affects one another, than capitalism must be able to provide sustainable solution for all three. As mentioned earlier this thesis will look into capitalism and environment. This will be done with references throughout the thesis concerning to the relevant UN 2030 Sustainable Development Goals.

Several of the goals among the new sustainability goals are largely related to the environment:

- Act immediately to stop climate change and fight the consequences

- Ensure sustainable consumption and production - Ensure sustainable energy that everyone can afford

- Preserve and use marine and marine resources in a sustainable manner

- Protecting, rebuilding and promoting sustainable use of Earth's ecosystems, ensuring sustainable forest management, safe species diversity, combating desertification and stopping and reversing erosion

33

List of SDGs adopted by the UN General Assembly in September 201549

Goal 1. End poverty in all its forms everywhere

Goal 2. End hunger, achieve food security and improved nutrition and promote sustainable agriculture Goal 3. Ensure healthy lives and promote well-being for all at all ages

Goal 4. Ensure inclusive and equitable quality education and promote lifelong learning opportunities for all Goal 5. Achieve gender equality and empower all women and girls

Goal 6. Ensure availability and sustainable management of water and sanitation for all Goal 7. Ensure access to affordable, reliable, sustainable and modern energy for all

Goal 8. Promote sustained, inclusive and sustainable economic growth, full and productive employment

and decent work for all

Goal 9. Build resilient infrastructure, promote inclusive and sustainable industrialisation and foster

innovation

Goal 10. Reduce inequality within and among countries

Goal 11. Make cities and human settlements inclusive, safe, resilient and sustainable Goal 12. Ensure sustainable consumption and production patterns

Goal 13. Take urgent action to combat climate change and its impacts

Goal 14. Conserve and sustainably use the oceans, seas and marine resources for sustainable

development

Goal 15. Protect, restore and promote sustainable use of terrestrial ecosystems, sustainably manage

forests, combat desertification, and halt and reverse land degradation and halt biodiversity loss

Goal 16. Promote peaceful and inclusive societies for sustainable development, provide access to justice

for all and build effective, accountable and inclusive institutions at all levels

Goal 17. Strengthen the means of implementation and revitalise the Global Partnership for Sustainable

Development

49 _{UN (2019)}

34

The five goals that I will use as the foundation of the analysis in this thesis are the following:

Goal 6: Ensure availability and sustainable management of water and sanitation for all Goal 7: Ensure access to affordable, reliable, sustainable and modern energy for all Goal 12: Ensure sustainable consumption and production patterns

Goal 13: Take urgent action to combat climate change and its impacts

Goal 14: Conserve and sustainably use the oceans, seas and marine resources for

sustainable development

The relevant targets within these goals will be presented as I go on with the analysis. Arguably, several of the other goals are partially concerned with the environment, but are mainly concerning either economic or social challenges. The chosen goals represent varies of challenges and issues concerning the environment, must of which are crucial to ensure a sustainable future for humankind.

5. Analysis

Is all hope lost for capitalism and is the political system unable to introduce the regulations that are necessary to battle climate change? Is the reality that politicians and business leaders are driven by self-interested and collaborate to undermine the majority of citizens' financial interests? Capitalism favors short-term profit-making rather than long-term investment, and is based on individualism and self-interest at the expense of the environment and society?

Should we stop treating economic growth as a measure of success, when in reality, this should be a means of achieving increased quality of life and happiness for the broad population? All to these questions emerge after we have no established that minimalist government,

short-termism and growth is all key characteristics of the modern capitalist society. A thesis on this

scale will not be able to take on all the goals and sufficiently take on the relevant problematic or unproblematic connection to between these characteristic of capitalism and ecological sustainability. Even with limiting the analysis to five goals and less than a third of the goals, the analysis will at times not be able to go into depth on every relevant question. This is a potential weakness of the analysis, but it is a sacrifice to be able to take on not one, but several environmental challenges. Without this, we easily lose sight of the bigger picture and it would be difficult to make any claims about capitalism and its role in an ecological

35

sustainable society. It is a huge problem that environmental issues are most often discussed independently of economic context - as if there is no economic system that has major implications for the environment.

5.1 Short-termism

Al Gore, former vice president of the United States and David Blood, a former Goldman Sachs’ Asset Manager, called for a transition from short-termism trading and gambling to actual long-term investment. This would allow business to be more global aware and live up to their responsibilities50. The day-to-day trading and “gambling” for Wall Street and other financial institutions are allocating money faster than ever. This function in the financial market can make it harder to access money for business that do want to achieve long term profits. Today, most of the transition in the energy sector are based on profit needs and interests of large companies and investor. The fact that there is growth in renewable energy indicates that renewable energy and capitalist might go hand in hand. The question is however if this happening fast enough to meet the current and future energy demand. Particularly when we also see that renewable energy are rather a complement to already existing capacity, we are inevitably faced with a challenge: The only way forward is by confronting the

consumption fossil energy production51_{. This is closely related to achive target set in UN}

sustainable development goal 7, 12 and 13. Most of the discussions about the environment have the underlying premise that we should not sacrifice anything to save the environment, or worse, that no one will save the environment if they do not make money from it. From the discussion above, however, it follows that it is wealth, not poverty, as many conclude from the Brundtland Commission, which is the problem. We need to change our societies, and how we invest (both nationally and globally) needs to change. Many of the changes will possible lead to long-term sustainable and predicable returns for business and investors. However, these business and investor will never offer green investment if they keep on being short-term orientated. Do we think that the free market, national regulations, political leadership or public education will solve the climate problem in time? The basic problem is that we are short-term oriented: We place little emphasis on the consequences of 20-40 years of today's action. It keeps us from sacrificing prosperity today for the benefit of the next generation. When it comes to the environment, this hesitation is accentuated by the fact that there will be no obvious short-term damage even if we continue to hesitate. The only thing that will happen

50 _{Gore and Blood (2009)}

36

is an "increase in the probability of extreme weather in another part of the world". It is hard to say how much of the blame the capitalist society deserves. One study on over 3000 companies in European countries suggests that price competition stipulates to short-termism which results in worsens environmental performance52. It is important to keep in mind that many variables are in play here and the study emphasised the fact that this does vary between countries and industries. Companies from one country could for varies reason think more short-term than companies from a different country53. This can be explained in the difference cultures, governance and political incentives that exists today. That makes it difficult to conclude on the question of how much capitalism is causing short-termism. What is clear is that this short-term thinking trend must and business as well as investors must be look at returns and profit in a longer time period than the next financial quarter.

5.2 Minimal government intervention

Geoffrey Underhill accentuate that if states or nation does not manage the market, then private interest and business owners will, sometimes on perfectly sensible terms54. _{The question is} then; can we count on private interest to manage the market in a way that promotes

sustainable development or at all does not hurt the environment? Historically and even today, many points out that wars and armed conflicts are the biggest threat to growth and

developments. Countries needs to do anything to avoid armed conflict or war. Summed up wars and coups are practically development in reverse55_{. The important of government} institutions is often seen in relation to how effectively it can promote and sustain peace. This logic can be applied to government interventions and institutions when it comes to climate change and the environment. The negative consequences following climate change are so severe for a country that government interventions and intuition can be justified and judges based on how effectively it can prevent the negative potential consequences. One can easily make the argument that more emission and damage to the earth is development in reverse in the same way wars and armed conflicts hurt a developing country or society. Countries have different approaches to sustainable development and the size of the government varies greatly. There are many things to take into account when we compare two countries. Let say that Qatar has a different emission profile. Can we explain this by the different degree of

52_{Graafland (2006)}

53_{Segelod (2000)} 54_{Underhill (2000)} 55_{Collier (2009)}

37

capitalism in the two respectable countries? Denmark is among the industrialized countries that have relatively low emissions of CO₂ per capita. The country can best be described as a capitalist democracy with a reasonably homogeneous population, quite a high prosperity, a high level of knowledge, and a not insignificant supply of oil and gas on its own continental shelf. Qatar is a country with elements of capitalist economy, somewhat higher population density than Denmark (much due to the import of outside labor), large revenues from oil and gas exports (with correspondingly high dependence on this trade), and with an authoritarian political governance which has only recently begun a very cautious transition towards something that might become a constitutional monarchy.

With these differences in mind we should be able to predict a pattern that we can likely use to generalize countries. We can assume that countries that are themselves rich in fossil fuels tend to (a) use more such energy than countries that have few or no fossil energy, and (b) be (or make oneself) more dependent on revenues from oil and / or gas exports. As a result of these differences in resource base and investment profiles, the emissions of CO22 per capita - under otherwise fairly similar conditions - are normally larger in countries such as Qatar than in countries such as Denmark, which are committed to obtaining energy also from their own renewable sources. If we add Norway - a country rich in oil, gas and hydropower, but otherwise have far more similarities with Denmark than with Qatar, we would expect that Norway's CO2₂ emissions per capita will be above Denmark's, but below Qatars. So what do numbers tell us? Norway do have higher emission per capita than Denmark56_{. Qatar on the}

other hand is ranked first in the world when it comes to emission per capita57 _{hypothesis is}

both trivial and correct, and the contrast vis-à-vis Qatar is striking. This illustrated not only now difficult it can be to compare countries and to look further at the importance of

government size is even harder. The United Nations Sustainable Development Goal 7 and 12 are aiming to increase renewable energy and end subsiding of fossil fuel. With this in mind, what are for example a country like Norway doing to reduce fossil fuels? As one of the largest petroleum producers in the world, Norway, frequently justifies their oil production by

claiming that there are less negative externalities from Norwegian oil and gas production than in countries like Russian and Saud Arabia. Terje Søviksnes, former petroleum and energy minister in Norway, pointed this out to “we have approximately 50 percent less CO2

emissions from the Norwegian oil and gas production compared with the average emissions

56 _{Eurostat (2018)}

38

from oil and gas production elsewhere in the world”58_{. This, call it “greenwashing”, is without}

doubt a phenomenal example of a government that actively supports and even promotes a sector that is a contradiction the UN SDGs. Minimalistic government or not, there is no guarantee that the respectable government actually promotes policies and values which are sustainable. One of the tricky challenges is that the environment and climate change is a global problem and hence require global solutions which in some cases needs to be enforced by global institutions. Globalization refers to the process which humans, businesses and nations around the world is becoming increasingly deepening on one another59. There are both benefits and disadvantages that I will not be able mention in detail in this thesis, but they do contribute to making governance more complicated and challenging. Global governance is increasingly relevant as the world becomes more independent60. This might also implicate that the individual governments are becoming less irrelevant as more and more as sustainable policies are being shaped on the global arena. So what about setting these policies to life? Regulations are becoming a more imminent feature of climate policy. How can minimalist government shape and execute the necessary regulations? Goal 12 and 6 are concerned with limiting the consumption of limited natural resources and ensure the access of clean water. Regulations can be a crucial instrument to achieve these goals, but the size of the government might not be the only thing that matters. Like previously illustrated by comparing Denmark, Norway and Qatar, many variables are at play to understand why government do what they do. This is also the case when it comes government’s ability to efficiently and successfully regulate something. The financial crisis that struck America and Europe happen in a sector with extensive use of regulations61. We all know what happen and without debating the role of the regulations, this reminds us that regulations might not be a guarantee to achieve or prevent anything. After all, when it comes to green policies and regulations, a political consensus for green policies is the foundation of anything. If not, what the government can and cannot do might not matter if the willingness to go green does not exist. A government that do however set out to do anything it can to achieve the goals will certainly have more influence if the government is bigger with more influence in society. The same way logic can also be applied to private individuals and business; a free market that do take into account the importance of a sustainable environment will also potentially be effect to achieve ecological

58 _{Euobserver (2018)}

59 _{Bishop (2016). P 146-148} 60 _{UN (2013)}

39

sustainable changes. In the end, the what is overall the most important key factor is that both government and a potentially free or freer market will have to be environment friend. The result could potentially be devastating if not and a non-regulated economy with a weak government can be problematic.

5.3 Growth

I have already established the important of growth in the modern capitalist society. This is even attended for in the UN SDGs with goal 8, which aims to ensure decent economic

growth. So is this economic growth in society a problem for the environment? Growth-rate in the developed countries has fallen yearly since the mid-80s with a growth rate of around 4 percent to rock bottom around and under 2 percent after the financial crises of 08-0962. Growth is still by many consider as necessary unavoidable in capitalism. Is this addiction to growth on coalition growth with sustainable development? Globalisation and economic growth in the last decades have put pressure on the earth as increased production and consumption are causing negative external effect on the environment63_{. Economics and}

sustainability is often used when economist talks about the rate an economy can grow without causing problems such as inflations64. Recent worries about growth and sustainable

development is concerned about how long economic growth can go on without causing increased pollution or overconsuming limited natural resources. Capitalism is an economic system based on endless and exponential growth. It is endless, as a steady production of economic profit is not just a desire or goal from some capitalists, it is a vital necessity for the economic system. Companies live by the same rule as the system in general: grow or die. This is embedded in capitalism itself, since a steady accumulation of capital is the very definition of capitalism. Investments are intended to increase the amount of capital, investment plus profit or interest. Capital accumulation is the foundation of our current economic system. Without growth it stops. In addition, it is imperative that capitalism grows exponentially. Thus, the economy does not grow with a fixed amount of money each year; it grows by a certain percentage. If the economy grows by 3% two years in a row, growth in the second year will be greater than the first. This causes capitalism not only to grow year by year, but in actual size it also grows faster and faster. If growth is 3% each year, the actual increase will

62 _{Streeck (2014). 169.}

63 _{Graafland (2016)} 64 _{Bishop (2016). 324.}

40

increase dramatically. Goal 13 emphasises the urge to action against climate change. Is yearly growth leading to more emission and pollution? An interesting contribution can be found in a study conducted by the World Resources Institute (WRI) of countries that had managed to reduce greenhouse gas emissions over the period 200-2014, while improving their national economy (GDP). Listed are 4 of the 5 Eastern European countries that were often referred to as Soviet "satellites" during the Cold War65. After the liberation from Soviet, these countries faced a demanding restructuring of their own political system, business and society. The global financial crisis in 2008/2009 made the situation even more difficult, and the task was all the more important. Available statistics indicate that the reforms that were carried out - most in the mild capitalist direction - were, as a whole, led to more efficient production and also to non-trivial reductions in CO₂ emissions and several other greenhouse gases. Of the 21 countries that the researchers found fulfilled both conditions to fit into the list, 17 today are members of the EU. Two of the other countries that met the requirements (USA and

Switzerland) are capitalist economies, while the latter two (Ukraine and Uzbekistan) are in different intermediate positions. In order to understand a country's emission profile and climate policy, we must take into account a broader set of factors - including the country's access to various types of energy resources, the costs of developing networks for the distribution of electric power as well as the country's economic system political and

governance. This is exactly the core of the issue of growth. Again, many variables determine the emission and pollution within a country and they all have different opportunity to ensure sustainable growth.

Many sees the urge to growth a necessary mean to increase the standard of living and are therefore willing to sacrifice the environment to achieve other goals. However, we must remember that not all growth is necessary on expense of the environment. All economic growth does not result in increasing consumption of natural resources and indefinite growth in these sectors might be sustainable. An example of this would be an author that publishes e-books. Since the book is not printed, the eventual increased book sale is not on the expense of trees. Sustainable growth do exist, but if we do have to reduce the growth rate, will we be worse off? Not necessary. When GDP growth is used as a benchmark, it can overlook the opportunities that increased production and growth are at the expense of other qualities of our lives, which also determine welfare. Material goods are just one component of what gives welfare. Leisure time, environment, satisfying jobs and quality of life are other important

65 _{World Resources Institute (2016)}

41

ingredients. This is part of the explanation why the top ten income per capita countries are not necessary the same at top ten happiest countries. If fact, only Norway, Iceland and

Switzerland is on top ten when it comes to happiness and income per captain66_{. Happiness and}

quality of life, not growth, should be the goal of a sustainable capitalist society. A capitalism without growth is still a hypothetical and scholars disagree if this is even possible, but

environment-friendly growth can be a key factor in the transition to a sustainably society. The only way to ensure this would be to limit growth in part of the economy that causes emission and pollution as well as overconsumption of natural resources. Good governance and long-term thinking from capitalist institutions are key players to achieve this. If the growth rate continue with not considering environmental interest, capitalism will run into problem with justifying its role in the future ecological sustainable society.

5.4 Capitalism and Sustainable Development

We have now look into three central characteristics to capitalism today and analysed to which degree they are harmonises with the UN Sustainable Development Goals concerning the environment and ecological sustainability. Several similarities between the characteristics have emerged although they do represent different obstacles on the journey into a more sustainable society. The transition to a more sustainable society will not be free and decision made will in some cases be on the expense of returns and profit. The earlier mentioned Norwegian Sovereign Wealth fund is already giving up return to live up to a high ethical standard67. By its own calculations, the fund is losing a potential of 1.9 presentence return by not investing in weapons and coal the past decade. Sacrifices like this will be a part of the everyday life of individuals and business in during the transition phase to a more sustainable future. American economist Philip Kotler point to the fact that can make huge profit and promote sustainable solutions. Companies like Amazon has a vision of making decisions that benefit customers. Howard Schultz of Starbucks is obsessed with delivering good customer experiences, IKEA set up the average salary from $9.17 to $11.76 in 2015, due to its vision of creating a better life for the employees, and Timberland Management takes careful

consideration of what materials they buy, and uses only sustainable suppliers. Such examples prove that companies with high environmental standards and wages can make huge profits and make choices that not only prioritize short-term gains, but also social responsibility and

66_{Forbes (2019), World Bank (2019)} 67 _{FT (2018)}