Jorgen Randers was one of the authors of the controversial 1972 book, ‘The Limits to Growth produced by the Club of Rome. In this conference call, he discusses his latest work, 2052, and his projections for the next 40 years of life on this planet.
Löffler: Yes, I wanted to ask how you respond to critics of The Limits to Growth (LTG) who maintain the scenarios of overshoot-collapse have not come true?
Randers: LTG was not a forecast of what would happen in the 21st century. It presented 12 futures for the world from 1970 to 2100, six of which were typically overshoot-collapse scenarios and six that were positive sustainable development scenarios. So, the scientific question is to ask which path the world has followed. Recent work has examined which of the scenarios best resembles the actual development from 1970 to 2010 and the conclusion is that it is essentially the resource crisis. In that scenario, overshoot-collapse occurs somewhere between 2020 and 2040, so it’s still ahead of us. The important thing about LTG is that it made the point that the world is so small, that humanity cannot plan to increase population and activity on this little planet forever.
Langley: Can you provide us with a broad picture of 2052, your new work?
Randers: The briefest description is that the difference between 2052 and LTG is that 2052 is a forecast. It is my description of what I think will actually happen over the next 40 years. It resembles the pollution crisis scenario from LTG, a situation where humanity grows, GDP grows and resources are sufficient to handle growth, but emissions of greenhouse gases are so large that we reach plus two degrees centigrade in warming by 2050. By 2080, we move to three degrees centigrade, which means self-reinforcing climate change and climate crisis are a possibility in the second half of this century.
Langley: Despite all our achievements, are we fundamentally stupid as a species? I mean, why have we collectively failed to take action to prevent overshoot-collapse occurring?
Randers: The human being is not fundamentally stupid, but fundamentally short term. We have evolved as a species with great success because of our ability to react quickly to imminent danger. But we are bad at sacrificing today to get benefits 60 years down the line. So, the short-term nature of man that has brought us to where we are is, as I see it, the main stumbling block now. We have created institutions which reflect this: capitalism allocates money to where the short-term returns are the highest; democratic society passes regulations which most people think are good; and what most people think is good is what increases their income in the short term. They are typically against things like tax increases and other ways of sacrificing today in order to have a better world in the future.
Löffler: One major stumbling block is myopic behavior, which dominates political and business decision-making. What is a way out of that vicious circle?
Randers: A simple way to solve myopia is to delegate power to a supranational institution, much like democracy has delegated the decision on money supply to something not under the daily, monthly or yearly control of parliament. One could delegate to a supranational institution the allocation of rights to emit greenhouse gases, so you would have a global central bank for climate emissions. Although this is simple in principle and rational, and would cost the ordinary consumer very little, I don’t think it will be done.
Löffler: I read your book a s a legacy calling people to action. What was your personal motivation for writing it?
Randers: Twofold. The public one is to convince people that their short-term nature should be compensated for by institutional frameworks that would reduce it. The personal action is that I’ve spent 40 years trying to work for sustainable development with very little success. Now I’m 67 and wanted to know if I should continue worrying about the future, to work out if something will go terribly wrong during the last 20 years of my life. I’ve reached the conclusion that it will not for my socioeconomic group, although most of the things I value have already been destroyed: untouched nature, wide open spaces and uncrowded environments. So it won’t get much worse – for me – over the next 20 years. Others will not be so lucky.
Löffler: If you were a large institutional investor, in which way would you try to positively influence and maybe even profit from change in the next 40 years? That is, how do you suggest they invest large amounts of money reasonably?
Randers: I sit on the sustainability council of multinational corporations, so this is easy. The first thing is to shift activity in a climatefriendly direction as much as is possible without incurring huge costs. There are many things which reduce the climate footprint without hurting the bottom line significantly. Then comes the question, should one proceed to do things that cost more? That depends on what kind of owner you have. If the owner is willing to sacrifice short-term profit in order for the firm to contribute to the solution of the world’s future, fine, but in most cases he is not and consequently there is nothing you can do, except start an educational program for your owner to try to make the owner change his mind. For any institutional investor this is, of course, impossible because they are owned by thousands or millions of people. So, essentially you don’t get anywhere as long as you operate within the rules of the capitalist system and democracy. The only thing you can do, and this is what I advise my “multinational friends” to do, is to work to change legislation.
Löffler: To what extent should ESG factors be incorporated into investors’ and asset managers’ decision-making and research processes?
Randers: Again, it depends on what time horizon you have. If you are an investor and you want maximum portfolio growth, wealth growth or asset value growth from year to year to year, then you shouldn’t do any of those things. You should focus on what maximizes profit. This, in my mind, is unethical, but most profitable in the short term. If you have a somewhat longer horizon, like multinationals that worry about reputation loss, they need to think more carefully about what type of ESG activities they become involved in. It is smart for them to become involved in things that cost as little as an insurance premium against reputation loss 20 years down the line.
Langley: 2052 is a stimulating and intellectually challenging read, but gloomy. Are there no grounds for optimism? Is it game over for humanity?
Randers: I think the world is highly unsustainable in the sense that we cannot continue to behave in the way we currently behave for generations without a problem. We will, of course, not continue behaving exactly as we do, we will change slightly as crises emerge. I forecast that humanity will respond strongly enough to avoid resource problems, water problems, food problems over the next 40 years, but we will not respond strongly enough to avoid the climate problem. It could easily have been avoided if we decided to do so, but we will not decide to do so. Consequently, our grandchildren will live in a world with a highly damaged climate. Whether this should be called “collapse,” I don’t know. It’s very different from what we have now, but for humanity, the game is not over.
Langley: When you look back at your life’s work, at a career of studying, analyzing and promoting the best possible future for humanity, do you see it as a wasted effort?
Randers: Clearly it has been in vain. It has not impacted strongly on what people do. But ask the question, ‘If I had lived once more would I have done something differently?’ The answer is probably not. I have been working with sustainable development for 40 years and it’s hard to think of anything else that I would like more to do than working for this lost cause.
About the speakers
Jørgen Randers, professor of climate strategy, BI Norwegian Business School
Jørgen was previously president of BI and deputy director general of the WWF (International) in Switzerland. He gives lectures on sustainable development and climate, and is a non-executive member of a number of corporate boards. He sits on the sustainability council of the Dow Chemical Company. In 2006, he chaired a cabinet-appointed commission that reported on how Norway can cut climate gas emissions by two-thirds by 2050.
Karsten Löffler, managing director, Allianz Climate Solutions
Prior to his appointment, Karsten managed the Allianz-WWF climate partnership on behalf of Allianz with a focus on questions of climate change. He is a member of the management committee of ClimateWise, a global collaborative insurance initiative that aims to respond to the risks and opportunities of climate change. Karsten is also a member of the Investment Commission and the Thematic Advisory Group Climate Change of the UNEP Finance Initiative (UNEP FI).
Greg Langley, editor-in-chief, PROJECT M
An Australian journalist based in Europe. Before being recruited to help found PROJECT M, Greg worked as an editorial director at international marketing communications agencies. He is the author of Decade of Dissent (1992), a study on the Australian anti-war movement during the Vietnam conflict.