It is time for governments to reimagine their own role as the guiding light of this sustainable world order and put the tough conversations on the table
The climate crisis has a competitor. It is called availability heuristics. A design flaw in our brain that was an evolutionary advantage in primordial times — giving us the ability to deliver rapid response while recognising and ducking charging predators in nanoseconds — is now hurtling us down the path of extinction.
We need a nature-inclusive economic metric to protect our forests and biodiversity. (Getty Images/iStockphoto)
What is it? Our brain has categories to make sense of surroundings and has a series of standard, rapid insights and snap judgments to save energy. These mental shortcuts are called availability heuristics but this cognitive function — tailor-made for a primaeval world — can often cloud our judgment in a complex, modern environment.
In multiple forums, I have countered these uncomfortable truths while discussing environmental degradation. This phenomenon takes many names: The climate crisis, the biodiversity crisis, rampant deforestation, soil crisis and the intractable complexities of food systems. These labels rarely come together.
Our cognitive failure makes us reach for easy to grasp categories, instead of looking at the collaborative and integrated effort required to address the climate crisis.
One example is the cognitive bargain that we have made as governments and people is to think of energy transition as the only way to counter the climate crisis rather than address the causal issue of predatory economics — the driving force behind the ecological degradation of our planet. Accepting this would mean overhauling every conceivable aspect of our well-oiled economic and social global order. Truth be told, environmental problems are the outcome of a market where destroying the earth does not influence the prices set by the marketplace. It externalises the costs of destroying nature.
The noted environmental economist Partha Dasgupta — in a paper submitted to the United Kingdom government last year — spoke of “biodiversity economics” and demonstrated that nature is a blind spot in economics. The current planetary degradation is the consequence of the absence of nature from the official conception of economic possibilities and national accounting as a critical indicator for human progress. Dasgupta highlighted that most governments around the world pay people more to exploit nature than to protect it and that destructive farming subsidies cause damages of $4-6 trillion per year.
Back home and especially for states such as Meghalaya — and others in the Northeast region, which are ecologically fragile and are forest economies — we need an alternative development and growth doctrine that has nature and environment at its operational heart. We need a nature-inclusive economic metric to protect our forests and biodiversity. Dasgupta added that the calculation of Gross Domestic Product (GDP) is based on a faulty application of economics because it measures the flow of money and not the stock of national assets.
An example of nature economics is Pakistan’s nature performance bond, which is designed by the Finance for Biodiversity Initiative (F4B). The initiative strives to factor biodiversity into financial decision-making. Pakistan’s nature performance bond would be tied to meeting nature-based targets. Under the scheme, a creditor country may write off a portion of the newly issued debt or reduce repayment interest rates if biodiversity and nature restoration targets are achieved.
We need similar bold examples of economic and financial reimagination to arrest our slide towards a dystopian future — and governments have to take the lead.
This sentiment was also voiced by Larry Fink, the CEO of asset management firm Black Rock. In his annual letter last month, he called on the governments to lead the change in accepting that businesses cannot be the ‘climate police’. Fink said that his company focuses on sustainability not because they are environmentalists but because they are capitalists and fiduciaries to clients. But this market transformation has to be led by governments, who will have to act as public sector innovators. They must provide clear pathways and a consistent taxonomy for sustainability policy, regulation, and disclosure across markets, as Fink says, for the private sector to rearrange its business. It is time for governments to reimagine their own role as the guiding light of this sustainable world order and put the tough conversations on the table.
James Sangma is minister of forest, environment & power, Meghalaya, and Iram Mirza, advisor to the government on impact programming.
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