Stockholm (NordSIP) – Despite the increased focus on sustainable investments and climate change, in particular, global efforts to effectively transition to a circular economy remain yet out of reach. With another 42% of the year still to go, today, July 29th, marks Earth Overshoot Day, the date when humanity’s demand for ecological resources and services in a given year exceeds what Earth can regenerate in that year.
To determine the date of Earth Overshoot Day for each year, the Global Footprint Network calculates the number of days of that year that Earth’s biocapacity suffices to provide for humanity’s Ecological Footprint. The remainder of the year corresponds to global overshoot. Earth Overshoot Day is computed by dividing the planet’s biocapacity (the amount of ecological resources Earth can generate that year) by humanity’s Ecological Footprint (humanity’s demand for that year), and multiplying by 365, the number of days in a year.
Previously, only in 2018 and 2019 did Earth Overshoot day precede this year’s milestone. In 2020 Earth Overshoot Day was pushed back to August 22nd on account of the pandemic-induced lockdowns. Either way, this year’s mark is a far cry from the 1970s when the accounts were still balanced. As of 2021, the Global Footprint Network estimates our annual demand for ecological resources and services is equivalent to what 1.7 Earths would regenerate.
The organisation also estimates when earth overshoot day would occur if the whole population of planet earth lived like specific countries. For reference, Denmark’s, Sweden’s, Norway’s or Finland’s Country overshoot Days already occurred on March 26th, April 6th, April 12th or April 10th, respectively.
Earth Overshoot Day is just one of several measures of our global inability to tackle the planet’s sustainability challenges. At the start of 2020, when the pandemic was still confined to Asia, the World Economic Forum (WEF) ranked climate-related threats as one of the top risks for 2020 for the first time since its Global Risks Perception Survey started being conducted 15 years ago.
In December 2020, a new report by Climate Action Tracker, an independent scientific analysis that tracks government climate action, announced that its end of century warming estimates for real-world emissions had fallen by 0.7°C from 3.6°C in 2015 to 2.9°C at the end of 2020.
At the end of March 2021, the Climate Action 100+ published its Net-Zero Company Benchmark assessment surveying the performance of 167 companies that account for over 80% of corporate industrial greenhouse gas emissions. In aggregate terms, the Benchmark assessments suggest that most of the world’s largest companies are still in the early stages of shifting to a net-zero economy. A majority of companies still have no discernible ambition to reach net-zero emission.
In April 2021, Arabesque used its Temperature Score technology to assess the alignment of companies listed in fourteen of the world’s largest stock indexes, including the FTSE 100, S&P 100, DAX and Nikkei, between 2015 and 2019. Based on the new analysis of global indexes, it found that, on average, 70% of companies worldwide would satisfy the 2030 climate target of 2°C set out in the Paris Agreement. 61% of companies are on track to meet the same goal by 2050, up from 41% in 2015 when 196 countries adopted the targets at COP 21.
Despite corporate efforts, financial commitments and political promises, Schroders is less sanguine than the Climate Action Tracker and estimates we are on track for a 3.6°C temperature increase from pre-industrial levels.
A Window of Opportunity
“In comparison with last year, especially increased carbon emissions contributed to our ecological footprint. The fact that we overshoot Earth’s capacity in the month that we experienced unprecedented extreme weather events – flooding in Europe and India, wildfires and extreme temperatures in the US, Canada and Siberia – is no coincidence,” Triodos Investment Management Chief Investment Strategist, Hans Stegeman commented on this occasion.
“While last year we thought that the Corona crisis would mark a point where we could change course and make our system more sustainable, Earth Overshoot Day shows us that we missed that chance completely,” Stegeman adds.
“However, we still have a window of opportunity. That window starts this autumn, with the Conference of the Parties (COP26) on climate and later on biodiversity. Political leaders hopefully will agree on stricter measures to avert worse outcomes. At the same time, it is up to private parties, including the financial sector, to contribute to a systemic shift towards a more sustainable society. Allocating capital in a more sustainable way is one of the biggest possibilities to accelerate that necessary change,” Stegeman concludes.
Image by Global Footprint Network