The G5 Talks session in October 2020 discussed an extremely relevant and current topic: building the foundations for a more sustainable and prosperous future. To discuss the matter, we invited Jorge Caldeira, Luana Schabib and Julia Marisa Sekula, authors of the book “Brasil: Paraíso Restaurável” (“Brazil: A Restorable Paradise). G5 Talks is a project through which business leaders exchange experiences and lessons learned with the G5 team.
In this edition, Eduardo Caldeira and Levindo Santos, partners at G5, discussed with the authors the urgent issues of the faced by the current economic model during the first decades of the 21st century, in which environmental concerns begin to occupy the center of the global agenda. Preserving nature will be at the heart of the financial value creation process – a new context that gives Brazil the opportunity to play a leading role.
The authors challenge the current model in which economic development contradicts the rational use of nature’s resources. “We can have economic growth through a sustainable use of natural resources. The current pandemic [Covid-19] has shown, once again, that most economic theories do not deeply analyze certain issues, such as environmental ones”, stated Julia.
According to the authors, data indicates that Brazil has the capacity to generate energy from renewable resources, such as wind and hydro, in a magnitude that is astounding even for those experienced in the matter. Luana highlights that the Brazilian energy matrix is one of the cleanest in the world. “Many Brazilians have no idea just how ahead we are in these matters”, concluded Julia.
Despite this, Jorge Caldeira draws attention to the fact that the country still has an inefficient institutional and regulatory framework. According to Jorge, countries such as Germany, India, Kazakhstan, the United States, the European Union, and China are just a few examples which adopted a new approach for their strategic plans. “Renewable energy has been imposing itself at a stunning speed and large economies began to use Environmental Goal Plans to guide their long-term planning.”
In March 2020, the European Union announced that in 2050, it will have 50% renewable energy matrix and therefore has changed its execution method. “Now, any company who wishes to receive government support to recover from the Covid-19 crisis must adhere to environmental goals and establish environmental programs. The entire release of recovery funds will be linked to the achievement of these goals.”
Currently, strategic planning is linked to the free carbon economy, unlike in the 70s, when nations were guided exclusively by GDP growth, added Caldeira. “This agenda was already being built during the 70s and 80s, but the covid-19 crisis advanced the discussions extraordinarily.” According to Caldeira, from 2000 to 2020, global production of solar and wind energy multiplied by 150 times. In 2020 alone, due to Covid-19, renewable energy resources surpassed coal, oil, and gas for the first time.
“Brazil made no conscious effort for this transition: it did not create laws and the transition to clean energy is not part of Brazilian programs. However, Brazil is still ahead in the game”. Despite this context, Jorge Caldeira explains that “thanks to our history and culture, our country has built an energetic reality that allows it to aspire to become a superpower in this new way of organizing the economy. The country’s exuberant nature, seen from a new angle, appears as the basis for future production”.
The question is: “We know we can, but are we willing to play a leading role in this new world?”