Fit for Fight

    Whether an honest attempt to create a catchphrase or just the product of a twisted sense of humour, ‘Fit for 55’[1] is trending, and not just on Twitter. Hopefully, for the right reasons. How could a self-respecting journalist pass the opportunity to comment on the EU’s new green legislative package, especially given that brilliant label?

    In the interest of full disclosure, I, too, made the wrong association the first time I saw that phrase in my newsflow. Understandably so, being in my early fifties and trying to stay reasonably fit for my age. Unlike many of my less nerdy peers, however, I was only slightly disappointed once the clickbaity link took me to a legal site describing the implications of EU’s revised climate and energy laws instead of suggesting a diet and exercise regimen.

    Environmental regulation can be pretty exciting of its own, mind you. Ask any of the myriad lobbyists, nervously awaiting the final announcement at the beginning of this week, and they will tell you it is a veritable cliff-hanger. Finns and Swedes, pale with anticipation, wonder whether forest biomass will still be considered a renewable energy source or not. Shipping giants tremble at the thought of gradually increasing “greenhouse gas intensity targets”.  And many are biting their nails trying to decipher the intricacies of ETS, the emissions-trading system that is to encompass even the building and road-transport sectors now.

    And, despite the ‘Made-in-Brussels’ label, it is not just Europeans who might lose some sleep over the incoming green laws. Aimed at preventing ‘carbon leakage’, that sneaky way of transferring production to non-EU countries with less strict climate rules, the new Carbon Border Adjustment Mechanism is bound to affect corporates around the world. NB to add ‘CBAM’ to your collection of sustainability acronyms.

    So, how important is this new package, really? At the official press conference unveiling it on Wednesday, Executive Vice-President for the European Green Deal Frans Timmermans called the moment “make-or-break”, and Paolo Gentiloni, EU Commissioner for Economy, meant that it is “the ultimate now or never moment.” They do sound grandiose, I know. Most, however, would agree that this legislative package marks the first attempt by a large economy to start translating the goal of climate neutrality into real-world policies.

    Hold on, say the sceptics. “This package of measures from the Commission is a fireworks display over a rubbish dump. It may look impressive, but move in close, and it begins to smell,” says Greenpeace EU director Jorgo Riss, according to the EUobserver. In the weeks to come, I expect many aggrieved parties to join his criticism, the devil being in the details and all.

    Well, nothing is set in stone yet. So far, the package is just a bunch of proposals. The negotiations between and within the EU member countries before the submissions become legally binding are expected to be tough. So, for those who do have a strong opinion and want their voice heard, here is my advice: get Fit for Fight!

    Image by Alonso Reyes on Unsplash

    [1] A legislative package of revised climate and energy laws, aiming to align key EU policies with the new 55 % net-emissions reduction by 2030, unveiled on July 14th

    Julia Axelsson, CAIA
    Julia Axelsson, CAIA
    Julia has accumulated experience in asset management for more than 20 years in Stockholm and Beijing, in portfolio management, asset allocation, fund selection and risk management. In December 2020, she completed a program in Sustainability Studies at the University of Linköping. Julia speaks Mandarin, Bulgarian, Hindi, Russian, Swedish, Urdu and English. She holds a Master in Indology from Sofia University and has completed studies in Economics at both Stockholm University and Stockholm School of Economics.

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