Stockholm (NordSIP) – At the end of 2024, the Cambridge Institute for Sustainability Leadership (CISL) published the second edition of its Competitive Sustainability Index (CSI), originally launched in 2022. According to the latest instance of this report, Nordics countries are in the lead.
The index integrates economic growth, innovation, and sustainable development information to provide a quantitative assessment of the performance of EU countries in terms of economic growth, innovation, social, governance, and environmental factors.“Unlike conventional approaches rooted in ‘sustainable competitiveness’, the CSI provides a forward-looking, integrated, and nuanced perspective, reflecting the latest insights on economic growth, innovation, and sustainable development. By aligning economic, social, governance, and environmental dimensions, the CSI seeks to inspire new policy thinking that supports EU countries, value chains, and companies in attracting investment amidst an urgent global transition toward truly sustainable development,” the CISL press release explains.
CIS Leaders in the EU
According to the latest assessment, Sweden, Finland and Denmark are the leaders of the EU in overall terms, followed by the Netherlands and Austria. At the bottom of the ranking, we find Romania, Bulgaria and Hungary. However, most countries, including the Nordics decreased in terms of their overall CSI. The five countries whose CSI most improved during the last two years were Latvia, Lithuania, Belgium, Slovakia and Bulgaria.
“Over the last two years, there have not been dramatic changes to the overall CSI results, but there are weaker performances overall and particularly in the economic and social dimensions in Europe. These may be in part a reflection of the specific implications for the EU of the lingering effects of the Covid crisis and higher inflation, the ongoing impacts of the energy shock provoked by Russia’s invasion of Ukraine and its longer-term impacts in demands for increased expenditure on defence. But they are also consistent with the Draghi report’s findings that the EU is declining in its competitiveness, especially in relation to its major competitors and rivals in key areas of its economy. This poses an enormous and urgent challenge to the EU’s strategy, both in the short term and over the medium to long term,” the report argues.
The EU and the World – Leader & Laggard
The report also shows that there is a lot of divergence within Europe. This issue becomes clear when the EU’s best and worst performers are put on the same stage as the USA and China. “Out of the 24 CSI indicators with available data for the US, China and the UK, the EU’s best performer is also global best-in-class in 21 cases. (…) Yet in 15 of these indicators the EU’s worst performer underperforms all its non-EU competitors,” the report explains.
“This highlights the uneven competitive sustainability performance across EU Member States and reveals the risks of fragmentation, as well as the enormous need for and benefit from collective improvement through enhanced cohesion within the EU,” the report explains.
Leaders in Innovation
The report shows that the EU (average) performance on innovation ecosystems is weaker than in 2022 on four out of six ecosystems, namely Energy, Industry, Buildings and Digital. this matters because these are important dimensions that the report identifies as channels that should lead the way to a low carbon European economy. According to the report, these declines reflect “the impact of the economic and geopolitical instability derived from recent crises. Public R&I efforts have diverted towards other political priorities whereas economic uncertainty also seems to have retracted private R&I investment ambition.”
However, the report also argues that the performance of the EU on the global cleantech venture capital (VC) market is much more positive than in other economic areas, such as biotech or digital technologies.
“Despite being currently third in the global cleantech VC race, it is closely disputing second place to China and although distant, it is within reach of the US (see Figure 6). Moreover, the EU has some global champions on cleantech investment in GDP terms. Thus, if other European countries would follow suit, the EU could seamlessly become global leader in cleantech VC investment,” the report argues.
