The World Economic Forum calls on companies to curb climate change and reduce its consequences. For this, however, states would first have to set the framework conditions.

The rise in energy costs caused by the Ukraine war provides German companies with a great opportunity to secure future earnings worth billions with sustainable technologies, raw materials and services. According to a report by the World Economic Forum (WEF), which will meet next week in Davos for its annual meeting, the opportunity is currently particularly favorable. However, politics must help by creating framework conditions and enabling international cooperation.

A significant statement. While German politicians are arguing whether they should stop the economy with a sustainability law or let things run free, the World Economic Forum gives reasons why the environment and prosperity of our country benefit from state intervention. However, because the WEF speaks of incentives and controls instead of bans, it shows the Federal Republic the middle course of the debate.

More on the topic: Every year, the Swiss spa town of Davos is the scene of one of the most important conferences in the world: the World Economic Forum. Top managers and politicians meet to talk about the state of the economy and society.

The reasoning of the WEF begins with a simple statement: whether sustainable products will prevail depends on their price compared to conventional alternatives: if the costs of electric cars slip below those of petrol engines, everyone will drive electrically, regardless of the green conscience.

Because petrol and cars cost more in Germany than in China, India and the USA, the Federal Republic will reach this tipping point earlier: while price-conscious people in other countries will continue to fill up their cars with fossil fuels for a long time, German bargain hunters are already plugging them in, according to a WEF forecast into the socket in the early 2030s.

This lead gives Germany and Europe an advantage: If it satisfies its higher demand with e-cars manufactured here, it will secure a leading role in an important market.

The same applies to the production of green hydrogen for steel production and green kerosene for aviation. Transporting goods by truck also costs about twice as much in this country as in China, which gives battery and hydrogen trucks a head start in Europe. The advantage extends to almost all industrial sectors. A huge opportunity for the German economy.

The German and European advantage of high costs disappears as soon as foreign governments intervene in their markets. For example, the much-discussed Inflation Reduction Act in the US subsidizes the production of green hydrogen, which offsets its cost disadvantage compared to gray hydrogen produced with fossil fuels. The country shifts the tipping point from the distant future to the present and overtakes Germany. India, China and South Africa also run multi-billion dollar climate support programs with similar effects.

The EU is also helping green industries: Emissions trading, for example, makes energy production from coal and natural gas more expensive in order to promote renewable energies. But, as the WEF report makes clear, Europe must not let up: the primary responsibility for climate-friendly management has shifted from companies to states. They would have to further improve the framework conditions in order to allow sustainable companies to flourish.

The WEF gives three reasons why states should adopt green laws now and why companies should use them for sustainable products:

!function(){var t=window.addEventListener?”addEventListener”:”attachEvent”;(0,window[t])(“attachEvent”==t?”onmessage”:”message”,function(t){if(“string”==typeof

The WEF therefore places companies and states in a joint responsibility: “More companies must work with politicians, international organizations and communities to prepare the world for the upcoming threats,” writes the World Economic Forum. “It not only helps society and the world. It helps their profits.”

Leading the way in opening up new green markets is like making a bet. “But it will most likely pay off.”