Sustainable Economy

The economic resilience of Ireland is intimately linked to environmental quality and to the supporting role of our ecosystems and natural resource services. The environment will thrive in the absence of an economy or a society, but the opposite does not hold. Economic and social wellbeing are intimately associated with the condition of the environment and its ability to sustain us. In general, what is good for the environment is good for the economy in the long term.

Current Trends

 

Circular Economy

One of the key drivers for an economy that is sustainable is the concept of building a ‘circular’ economy which aims to reduce waste and ensure that materials are used as efficiently as possible. Every year, Ireland uses over 100 million tonnes of materials, and too much of the waste from this often ends up in landfill or an incinerator after only a short period of use. Being more circular involves getting the most from products by using them as fully as possible; by sharing items with others to re-use where possible; and by increasing our levels of recycling to at least recover the value of the materials used to make these products. For businesses, the circular economy reduces costs, improves the raw material supply chain and offers opportunities such as new business models and markets. For individuals, the circular economy offers a sustainable lifestyle with reduced environmental impact and lower household bills.

Fully adopting a circular economy will require significant shifts in our consumption habits and in our production & distribution systems. Some of these changes will be technological innovations such as the introduction of bio-based plastics; and some will be about developing new businesses to allow consumers shared access to products; and some will simply be behaviour changes as we move to a new way of thinking on the use and disposal of the materials around us.

In Ireland, the National Waste Prevention Programme works with others to drive Ireland’s Circular Economy . It supports behavioural change and sustainable choices through targeted funding programmes and sharing best practices across six priority areas: Food Waste; Construction & Demolition; Plastics; Agriculture; Resources & Raw Materials; and Local Waste Prevention.

United Nations Sustainable Development Goals

September 2015 saw the globally significant intergovernmental meeting convened by the UN to agree a plan of action for People, Planet & Prosperity. Seventeen Sustainable Development Goals with 169 targets were agreed. This plan envisages a world in which nations can enjoy inclusive and sustainable economic growth, with decent work for all, and where consumption and production patterns, as well as the use of all natural resources, are sustainable. In 2018, a National Implementation Plan was published outlining a whole-of-government approach to implement the 17 goals.

Green Public Procurement

Green Public Procurement (GPP) is a process where public and semi-public bodies meet their needs for goods and services by choosing solutions that have a reduced impact on the environment throughout their life-cycle. It also uses the huge purchasing power of government to prompt suppliers to develop greener products and services, that are then in turn available across the entire economy. GPP sees environmental criteria being used to select suppliers - alongside cost and other factors. The EPA produced GPP guidance to assist purchasers in pursuing this approach and it is identified as a priority at EU level under the circular economy.

Corporate Social Responsibility

Corporate social responsibility (CSR) is a concept which captures actions by companies to employ voluntary approaches to integrate social and environmental concerns into their mainstream business operations. CSR goes beyond compliance with legislative requirements and involves commitment by companies to carry out their business in an ethical and responsible way. It is a voluntary concept, which is led by enterprise and is supported by government through strategic direction, facilitative policy making and networking platforms.

CSR is well-established in Ireland, ranging from large-scale international corporate programmes to company sponsorships of local events and groups. The breadth of activity in Ireland is recognised through programmes such as the Chambers Ireland’s annual CSR Awards, which includes an ‘environment’ category – sponsored by EPA.

Non-Financial Reporting

From 2018, EU law requires companies to include statements in their annual reports to disclose information on how they manage social and environmental challenges. This helps investors, consumers, policy makers and others to evaluate the non-financial performance of large companies and encourages these companies to develop a responsible approach to business. The legislation currently applies to large companies with more than 500 employees and covers approximately 6,000 businesses across the EU. The European Commission has published guidelines to help companies preparing to disclose environmental and social information.

There are a number of organisations that promote and enable companies to report on their environmental impacts. CDP is an international, not-for-profit organisation providing a global platform for disclosing and ranking carbon emissions. The EPA supports the CDP Ireland Network which works with 80 members from across a range of sectors to report carbon emissions and promote sustainable business.

Cause

 

National "Environomic" Performance

There is some evidence of the need to decouple economic activity and growth from environmental impact. In recent years, Ireland has moved from a position of being one of the most resource-inefficient economies in the EU (our rate of material consumption was growing faster than the population) to greatly improve its efficiency in terms of raw material consumption per capita.

The reduction in personal consumption and building programmes over this period largely contributed to this trend. This reduction in building has induced social challenges (e.g. housing availability), suggesting that the scale of reduction was too severe and poorly managed. Better integration and coherence between environmental, economic and social policy needs could act to mitigate these shock swings.

Harmful Environmental Subsidies

It is now recognised that environmentally harmful subsidies can lead to lock-in of unsustainable technologies and infrastructure, as well as poor decision making. It is estimated that the scale of subsidies with potential negative impacts on the environment, notably in the areas of fossil fuels, transport and water, are worth €1 trillion per year. Environmentally harmful subsidies lead to higher levels of waste, polluting emissions (including climate change gases), inefficient resource extraction and negative impacts on biodiversity. They can lock in inefficient practices and hinder businesses from investing in green (more sustainable) technologies.

The EU Commission sees environmental taxation as an essential market mechanism to address any pricing market failures. The State will need to undertake a review of environmentally harmful subsidies that may be operating and set about eliminating them; examples include subsided peat extraction, low CO2 vehicle tax (causing rise in diesel use and particulate air emissions) and green diesel VAT relief. Ireland has achieved considerable behavioural change success in relation to employing taxation based measures to address certain environmental harms, e.g. the plastic bag tax, the landfill levy, and the carbon tax.

What's Being Done

Ireland - Our Sustainable Future

The aims of this government policy Our Sustainable Future are to provide for the integration of sustainable development into key areas of policy, to put in place effective implementation mechanisms, and to deliver concrete measures to progress sustainable development. A recent progress report on actions under the national sustainability plan has concluded that Ireland continues to move in the right direction generally across the spectrum of sustainable development goals, while recognising the role of the economic downturn in reduced emissions and consumption. The report also concluded that it will be important to maintain our focus on sustainability through the period of economic recovery and growth.

In its 2014 Climate Change Policy Position document, the Irish Government articulated a vision to 2050 that integrates the climate and sustainability imperatives in stating that it aims “as a fundamental national objective, to achieve transition to a competitive, low-carbon, climate-resilient and environmentally sustainable economy by 2050”.

Sustainable Development Goals (SDGs)

Ireland has developed a public platform for exploring, downloading and combining publicly available data relating to the UN and the European Union (EU) Sustainable Development Goals.  Ireland's progress against each Goal is measured using a set of globally and EU agreed Indicators and on the platform you can search for, discover and visualise the data used to create those indicators.  The link to the platform in the sidebar will bring you to the site where you will find environmental and other data.  This platform was developed as part of a partnership between Ordnance Survey Ireland, the Central Statistics Office and Esri Ireland.  It is now the Government of Ireland platform for SDG data.

Circular Economy

The coming years will need to see much greater effort – at an institutional and commercial level – to secure the supply, from sustainable sources, of the primary and secondary raw materials necessary to sustain our economies and our wellbeing. The recognition of the limitation of critical raw materials, allied to the ambition of resource efficiency and life cycle assessment for goods and services, has evolved and coalesced into the concept of the circular economy.

The enabling conditions needed to move to a circular economy require wide-ranging integrated market interventions such as eco-design, eco-labelling, life cycle assessment, recycling, durability, clean production, repair and reuse, elimination of harmful chemicals, renewable energy, carbon neutrality, etc. Most of these policies and concepts will require major intervention over the coming years if they are to become the reality and norm. From a social and values perspective, the circular economy can assist in driving an appreciation of sufficiency as regards consumption behaviours. 

Assessing the Life Cycle of Goods and Services

In the coming decade, businesses will increasingly be required through regulatory approaches to undertake life cycle assessment for their goods and services and to adopt eco-label standards. The latter are essential to support informed consumption choices. Goods and services that currently incorporate environmentally harmful substances/practices will be required to be eliminated or replaced.

In Ireland, the significant role expected for agricultural and food production and tourism will require ambitious and monitored sectoral development plans to ensure that future growth can be achieved through carbon neutrality and sustainable production/service processes. The national food sector development plan, Food Wise 2025, includes a monitoring and implementation plan to track and measure implementation of initiatives and actions, in particular those dealing with the environmentally sustainable expansion of the sector.

Economic Sector Plans for Sustainability

National plans and programmes also contribute to progressing decoupling. Bord Bia, through its very successful Origin Green Programme, has identified the competitive advantage of marketing sustainable low carbon produce to a national and international audience. Bord Bia has developed a suite of programmes for its client primary producers and processors to progress certified resource-efficient sustainable food production practices.

Major producers, retailers and service providers are also progressing greener credentials as part of their commercial strategy (e.g. Green Hospitality, the Musgrave Group’s Environmental & Social Accountability Policy). The need for sustainability is strongly reflected in a number of national sectoral policies and economic development strategies (e.g. Food Wise 2025, National Energy Efficiency and Renewable Energy Action Plans). Strategies should include a commitment to report publicly and regularly on their environmental performance against relevant environmental indicators. This will make the strategies more robust and provide for increased environmental accountability and transparency during implementation.

Economic Value of the Environment

Not only is there evidence of decarbonisation, resource efficiency and green growth, but there is also evidence that the economic contribution of a valued and protected environment is becoming widely appreciated at business and policy level (e.g. Origin Green, eco-labelling, green tourism). This realisation is strong at the general public level, also, as indicated by the results of a 2014 EU survey of environmental attitudes, which found that Irish people’s appreciation of the economic value of the environment significantly exceeds the EU average. The coming years will need to see a broader range of metrics and indicators developed for national economic performance that take into account matters such as wellbeing, environmental health, ecosystem services and natural capital.

Outlook

Sustainable competitiveness should be at the heart of thinking about sustainability. This is because competitive economies tend to be more innovative, more resilient and better able to respond to external shocks and, therefore, maintain high levels of prosperity into the future. A recent EU report concluded that the economic challenges currently facing Europe are not cyclical, but of a structural nature. The report added that European production and consumption practices and expectations are not equipped to face a global climate of slow demand growth and resource volatility, commenting that “without change the EU will become inevitably less competitive, less attractive, and less economically viable”.

Growing population, the competition for diminishing resources, the appropriate recognition of ecosystem services and natural capital, as well as the adaptive challenges arising from our changing climate and our national climate change commitments will, over the next 30 years, require ambitious social and economic interventions and responses. We will need to put economies on a more sustainable footing, resulting in a resource-efficient, carbon-neutral, circular economy. This will require an all-of-society response: essentially we have to rethink, and redesign what we mean by social and economic ‘prosperity’ in order to deliver the resilience essential for us to prevail.  

Sustainable Competiveness

We must all learn to live, produce and consume within the physical and biological limits of the planet. To achieve this will require integrated and enduring governance, including brave social and economic measures. Ireland’s economy needs to strive for sustainable competitiveness, defined as the set of institutions, policies and factors that make a nation productive over the longer term while ensuring social and environmental sustainability.

We know from previous national statistics that excessive consumption can lead to significant wastefulness and other environmental burdens. The EU’s Eurobarometer survey of environmental attitudes notes that 94% of Irish people rate protection of the environment as fairly or very important, and 96% agree that they can play a role in protecting the environment. The governance challenge is to realise these declared intentions in displayed behaviours.

The State must consider market interventions and other policy instruments that correct market failures, and also both direct and where possible “nudge” (through elective and, in time, normalised value-based decisions) consumption and production behaviours towards a more sustainable outcome.

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