Closing speech Ben Knapen Rio+20 business and industry consultation

Toespraak | 12-04-2012

Ladies and gentlemen,

In his hilariously ironic essay ‘How to write about Africa’, the Kenyan author Binyavanga Wainaina wrote, ‘When talking about exploitation by foreigners mention the Chinese and Indian traders. Blame the West for Africa’s situation. But do not be too specific. (…) Broad brushstrokes throughout are good.’

Sadly, Wainana has a point ─ development issues are frequently painted in broad strokes. Take the role of business in development, for instance. Companies are often portrayed as Trojan horses, as greedy cuckoos in a nest of do-gooders.

This is of course extremely short-sighted. The main tool for progress in developing countries is green and inclusive growth. Only growth can help people to help themselves. The private sector is the key to growth, provided it works in a sustainable way. So I am pleased to see the business community showing its good will here in The Hague.

Over the past two days we have discussed some key issues concerning the transition towards an inclusive and green economy. Public-private cooperation was a recurring issue at this conference. Governments, business and civil society need to cooperate in the transition towards a green and inclusive economy.

Governments can play a role by eliminating barriers to sustainable investment and putting an enabling policy framework in place. Moreover, the trend in development cooperation is to leverage private sector investments with public sector financial support. This means, for example, risk sharing in critical early phases.

Business, on the other hand, realises that in the long run sustainability is a prerequisite for profitability. Resources are finite, and increasingly scarce. In the whole supply chain, efforts are needed to increase resource efficiency. Commodity traders and processors are looking at their supply chains. Not only to ensure reliable supply and consistent quality, but more and more to enhance the sustainability of production.

Another recurring issue was the need for a clearer definition of our roles and responsibilities in order to make the changing relationship between government and business effective. What can we expect from each other and how can we effectively join our efforts to make the transition to a green and inclusive economy happen? It is a real challenge to further develop our ideas on the relationship between business and government.

How to build a green and inclusive economy, in developing as well as developed countries, was another hot topic at the conference. I see a clear need in developing countries for sharing knowledge, ideas and best practices. I believe the Capacity Development Scheme proposed for Rio+20 is a good instrument ‘to facilitate and provide country-specific and where appropriate region- and sector-specific advice to all interested countries regarding the transition to a green economy’. This is where business needs to step in as well. Its involvement is essential for sustainable economic development.

Rio+20 is the perfect occasion to take all these issues to the next level. So I sincerely hope that the outcome document of this conference will be, not a lengthy paper, but a concise plan for concrete action. As Mr Sha Zukang said: ‘We do not need more paper; we need implementation.’

Having said that, ladies and gentlemen, there is always something to wish for. Allow me to make two brief points. My first point concerns the role of consumers in sustainable development. Almost 90% of money transfers from north to south are private capital. You and I are behind these transfers. We buy stuff, we use energy, we save for our pensions. We travel. We work. We do all sorts of things that have an impact on the planet. In my view, consumers are crucial for a green and inclusive future.

Let me give you one simple example. Company X buys rice in country Y, and sells it on the world’s markets. The rice is not expensive. But its production causes the groundwater level in country Y to drop dramatically. In thirty years’ time, the result may be a ruined delta. The cost of a drop in groundwater ─ a common good ─ is not accounted for in the price of the rice as it should be.

People and businesses need to take such factors into account when they buy rice ─ or any other product, for that matter – in their local supermarket. To make this happen, consumers need reliable information about the products they buy. So transparency and accountability are crucial. Without them, the prospect of a more sustainable future is distant indeed.

Ladies and gentlemen, I come to my second and final point. Yes, it is important to know who is producing sustainably and who is not. But we should look further than producers’ supply chains. We need to include the financial sector in our efforts to set up an inclusive and green economy.

The investment choices of banks, pension funds and venture capitalists have a serious impact on sustainability across the whole production chain. Financial institutions are at the heart of the matter. So let’s think of effective ways to persuade them to make their investment portfolios greener and more inclusive. For I believe, first and foremost, in self-regulation.

Thank you for your attention and your contribution to this consultation. I’ll wish you a save trip home, some of you a good trip to Rio and most of all, I wish us all a happy journey back home afterwards.