“Fit for 55” package : transitioning towards a net-zero economy

With the legislative package presented by the European Commission on 14 July, the European Union presents the details of its plan to transform the commitment for a net-zero Europe within 2050. CEC European Managers highlights the importance to accompany the transition through sustainable leadership and innovation to put it into practice. Managers today are not equipped with the transition know-how, as our study has shown. The 13 initiatives touch on a wide range of areas and represent an ambitious step in terms of policy planning – a demanding agenda for both institutions and stakeholders to deliver upon.

“The launch of the FitFor55 package brings important incentives. For the transition to be realistic, effective and fair, a broad involvement will be needed. The managers we represent are on the frontline of change in every sector and are key to ensure that sustainability becomes a structural, systemic feature of our economies and societies. That’s why they have to be involved timely in the discussion and be equipped with the know-how to make it happen.” Maxime Legrand, President

After enshrining in a legal document the principle of reaching carbon neutrality by 2050 with the European Climate Law, the time has now come to act, setting new objectives and policies that will make it possible for Europe to achieve this goal. The “FitFor55” package targets the intermediate step of a 55% reduction of carbon emissions by 2030, by intervening on a series of policy domains.
The European Commission rightly identifies the need to create new thresholds for emissions, to integrate the global dimension and to rethink industry and land use.

For the European Union to be “fit” for a sustainable economy, CEC European Managers highlights the need to accompany the transition also through sustainable lifelong learning policies, a sustainable leadership culture and incentives for the uptake of new sustainable business models. It is about redesigning our economic system, creating better incentives for sustainable activities and limiting the most damaging practices of today. In that regard, the phase out of fossil fuel dependency and most damaging agricultural practices have to be prioritized.

The measures of the “Fit for 55” package include:

  • the revision of the European Emissions Trading Scheme, which will now be extended to new sectors like maritime transport and the construction sector and will be accompanied by the creation of a social fund
  • a set of measures addressing the transport sector, ranging from setting new CO2 emission levels for cars to decarbonizing air and maritime transportation and supporting the uptake of alternative fuels;
  • agriculture and land use, with a new forest strategy and a revision on the land use regulation;
  • energy production, taxation and consumption
  • a new initiative on border carbon adjustment, introducing a sort of environmental tariff to a set of imported industrial products.

CEC European Managers welcomes the multi-sectoral and integrated approach the European Commission follows with this package. Importantly, the transition will require the active participation of social partners on the ground and increased efforts for building up new sustainable business ecosystems to help businesses transition and new start-ups deliver on the EU’s Green Deal objectives. That’s why such efforts should also be streamlined with the EU’s industrial strategy and the sustainable finance agenda. Discussions on the proposed initiatives will surely keep both EU institutions and various stakeholders busy for the close future; the extent of the scope and the complexity of the domains at stake also seems to vouch for a rather challenging exercise by all involved actors to deliver on these proposals.