Bloomberg News

UN Reaps Sustainability Pledges Worth $513 Billion in Rio

June 23, 2012

US Secretary of State Addresses the UN's Rio+20

US Secretary of State Hillary Clinton delivers a speech during a plenary session of the UN Conference on Sustainable Development, Rio+20, in Rio de Janeiro, Brazil, on June 22, 2012. World leaders attending the UN summit in Rio weighed steps to root out poverty and protect the environment as thousands of activists held several protests to denounce Amazon rainforest deforestation, the plight of indigenous peoples and the "green economy" being advocated at the UN gathering. Photographer: Antonio Scorza/AFP/Getty Images

The United Nations obtained pledges worth $513 billion from governments and companies for projects aimed at reducing the strain on the planet’s resources, the biggest accomplishment at a meeting that world leaders and environmentalists assailed for not setting strong enough goals.

The 692 individual commitments from governments are for projects that cut fossil fuel use, boost renewable energy, conserve water and alleviate poverty, Sha Zukang, secretary- general of the UN Conference on Sustainable Development, said yesterday in Rio de Janeiro.

UN officials said the voluntary pledges will be the central legacy of the Rio+20 meeting marking two decades since the first Earth Summit. They may accomplish more than the official accord from the meeting, 49 pages of recommendations that disappointed leaders, including French President Francois Hollande.

“These huge numbers give a sense of the scale and growth of investment going into sustainable development,” UN Secretary-General Ban Ki-moon, said at the conference late yesterday. “They are part of a growing global movement for change. Our job now is to create a critical mass, an irresistible momentum.”

The summit in Rio in 1992 led to treaties on global warming, deserts and biodiversity. This year’s gathering, the UN’s biggest ever, had 45,300 delegates from more than 180 nations. It produced a non-binding document, with nations agreeing to keep talking about still-undefined “sustainable development goals.”

Summit ‘Hijacked’

Much of the work detailed by the UN yesterday already has begun, including projects backed by PepsiCo Inc. (PEP:US) and billionaire Richard Branson’s Carbon War Room, and $2 billion in support from the U.S.

Environmental groups such as Friends of the Earth International said the summit was “hijacked” by business interests. Delegates said governments need the help of companies.

“Without the private sector it’s not going to work,” Jose-Angel Gurria, secretary-general of the Organization for Economic Cooperation & Development, said in an interview. “While governments put up the seed money, the big numbers come from the private sector. The private sector is looking at green growth with great interest, seeing it as an opportunity, as jobs, as investment.”

Many of the pledges were made public before the conference in Rio this past week. This is the first time the UN has given a comprehensive estimate of their value.

Sustainability Studies

The promises include at least 243 programs related to higher education projects such as studies of sustainability issues at universities in Sydney, Beijing, Paris and New York.

About $280 billion was invested in renewable energy worldwide last year, according to Bloomberg New Energy Finance. The London research group has counted more than $1 trillion of funds for projects in wind, solar, biofuels and geothermal energy since its records began in 2004.

“There’s no doubt that Rio+20 fell short,” said Manish Bapna, acting president of the World Resources Institute, a Washington-based environmental research group. “But it’s a mistake to conflate what happened here with what’s happening on the ground. You just need to look beyond the walls of the conference to find real-world examples of action.”

‘Rallying Cry’

The Natural Resources Defense Council, a New York-based environmental advocate following a smaller group of commitments with specific targets, counts 209 separate commitments worth at least $500 million on its website.

“Rio can’t be about the text,” said Jake Schmidt, NRDC’s director of climate policy. “It’s got to be about the commitments and the rallying cry that’s coming from the public.”

The record of governments delivering on promises like the ones they’ve made this week is “very poor,” said Bjorn Lomborg, a professor at Copenhagen Business School and author of “The Skeptical Environmentalist.” He said the pledges reflect efforts of companies to take advantage of government incentives they expect to flow due to the recommendations set out in Rio.

“The reason lots and lots of businesses are in Rio is they’re rent-seeking,” Lomborg said in an interview. “They’re looking for huge potential subsidies for everything they produce.”

The UN pledges also cover a Dutch cycling campaign, Bank of America Corp. (BAC:US)’s $50 billion plan to stimulate lending for sustainability and the UN’s $50 billion program to bring cleaner forms of energy to the world’s poorest nations.

Half Done

“I don’t see business people demanding a stronger UN text,” Bank of America (BAC:US) Chairman Chad Holliday said in an interview in Rio. “We won’t save the world alone, but we’ll get half of it done, and we’ll get some momentum.”

Among the voluntary efforts unveiled this week in Rio is a $20 million grant from the U.S. to spur clean energy in Africa, which will unlock greater financing from the Overseas Private Investment Corp. Secretary of State Hillary Clinton said sustainability won’t happen without business investment.

“Governments alone cannot solve all the problems we face, from climate change to persistent poverty to chronic energy shortages,” Clinton said at an event announcing the funding in Rio. “That’s why we are so strongly in favor of partnerships.”

To contact the reporters on this story: Reed Landberg in Rio de Janeiro at landberg@bloomberg.net; Alex Morales in Rio de Janeiro at amorales2@bloomberg.net

To contact the editor responsible for this story: Reed Landberg at landberg@bloomberg.net


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