Ushering in a Greener Economic Era

By David Feffer

We are living something we never imagined: we changed the way we work, get along, consume, and relate to each other. We know how we got into this but not how we will come out of it.

What does the future hold? Nobody can predict anything and most of the paths shown are replete with “well-grounded guesswork” – reality, though, will be quite different from what we can foretell. What we realize is that there is no progress without adversities: we learned new things, broke paradigms, and started seeing (and living) the future in a whole new way.

While we have been obliged to stay home, the scenery outside has changed as well. Nature got a fresh breath of life, we once again saw sea birds through our windows, cleaner water, less pollution in urban centers and we noticed a human need to reach out to things “natural” during this period. This trend draws our attention once again to an important topic of debate that is often forgotten: the climate issue. The subject has long ceased to be on the agenda of just NGOs and activists; it has also entered the agenda of major corporations and even become one of the key challenges in the financial markets.

That is some change of attitude: earlier, the pressure was on companies, but now the governments, too, feel the heat. The trend is to look for sustainable initiatives that generate profits but also lay emphasis on preservation, environmental restoration, and social prosperity.

There is so much to be done — and now is the time for us to make a commitment to the future. We have a unique opportunity to become the benchmark for what is called “stakeholder capitalism”. This is our chance to show that there is no such thing as preservation “OR” growth. We must advocate and push through the “AND” so that we are ambidextrous and can do both at the same time: grow, develop, “AND” protect the environment!

Brazil, where I work, is home to the world’s largest biodiversity, which demands much responsibility. If we preserve it, restore it and do the right things, we can become a hub of investments sufficient to take care of our own country and the future of our species, for our economy, for society and for the planet!

I strongly believe in the “Brazil Brand”, with our country leading the world in sustainable development. Our forest, which was given to us as a gift, must be preserved and cared for. It is an extremely important environmental asset with the potential to bring us huge opportunities for economic development. It is of fundamental importance to understand that, apart from being a matter of survival, preservation is also an important economic factor.

The green bonds market is an opportunity that Brazil must capitalize on. Green bonds are debt securities issued to fund projects with environmental benefits that can be measured, audited, and monitored by independent organizations. Investments can be made in renewable energy, energy efficiency, pollution control, conservation of biodiversity and clean transport, among others. According to the Climate Bonds Initiative (CBI), Brazil’s green bonds market reached US $1.2 billion in 2019 and there is certainly much room for growth.

Carbon may be the currency of the international financial market for the next few years. And hence, we have the challenge of improving this market in Brazil. To put things in perspective, the Amazon biome alone could yield the country US$10 billion a year. Today, the credit generation process (CDM) takes around two years, so it is time consuming, bureaucratic, and expensive. If the market were regulated in Brazil or if there were a strong voluntary market, we would have specific mechanisms tailored to our country’s reality, thus increasing the volume of transactions, and driving the competitiveness of less carbonintensive players. In parallel, multilateral agreements and a more active role by Brazil in the international markets can also help leverage this environmentally positive agenda.

For that, we need the engagement AND commitment of society, as well as the private AND public sectors. As citizens, it is our duty to monitor, and especially, be engaged with the cause. From companies, we expect profits associated with sustainable development. From governments, we expect proper, efficient, and permanent law enforcement combined with comprehensive and transparent information, since we already have - generally speaking - public policies and regulatory frameworks that are aligned with the best preservation practices around the world.

The COVID-19 pandemic removed us from our comfort zone and spurred us to reflect on what we truly value and how we relate to the world. Brazil has the potential to be at the vanguard of protecting the environment, as the new economic era will certainly be oriented towards the environment and the fight against global warming. This is our green chance to spearhead the important and urgent renovation that the planet so desperately needs, thus paving a sustainable future for future generations. ■ DAVID FEFFER is Chairman of the Board of Directors of The Suzano Group from Brazil, one of the shareholders of Suzano, the world’s leading producer of eucalyptus pulp and one of Latin America’s largest paper producers. It plays a part in the lives of over two billion people with its social responsible, environmentally friendly approach.