Χαιρετισμός Ρ. Αικατερινάρη, Προέδρου Εκτελεστικής Επιτροπής ΣΕΒ στην εκδήλωση του ICC Hellas με keynote speaker τον Δρ. Richard Damania

Good afternoon. Dear Petros and Marieta thank you for the invitation to this great initiative organized by the International Chamber of Commerce. Dr Damania I am excited to meet you and looking forward to your speech. Let me say a few words on the matter of sustainability from the businesses perspective and how we believe regulators and businesses should work together

The global challenge concerning sustainability and the design of effective policies

• We are living through a period of profound global disruption. Rising geopolitical tensions, fragile supply chains, volatile energy prices, rapid AI penetration, increasing inequalities, ageing population, more authoritative regimes and declining of power of global consensus institutions are reshaping the landscape around us.
• Climate change adaptation, water stress, and biodiversity loss are no longer distant or abstract risks. These are tangible risks that require our urgent attention.
• In this environment, the question of sustainable economic growth is a profoundly strategic one, not just with respect to our competitors, but for our future prosperity and existence.
• The economy does not exist outside nature, and now that the latter is in crisis, sustainability is no longer a matter of good intentions. Instead, it is a core determinant of our economies’ resilience, competitiveness and our ability to create economic and social capital. I recently read something that reminded me how relevant Ancient Greek thought remains throughout the centuries. Hippocrates did not only speak about people’s health, but also about the sustainability of systems. A system, he argued, does not survive by becoming powerful, but by learning not to turn against itself. Systems endure through balance, not excess. This moderation protects them from the illusion that they can expand indefinitely, without cost. This feels more relevant than ever.
• When natural systems deteriorate, costs rise and entire sectors face growing operational and financial risks.  Already, industrial production is being disrupted in regions affected by water scarcity. Supply chains are increasingly exposed to climate change. Insurance markets are repricing risk. Investment decisions are being reshaped by ecosystem degradation and resource insecurity.
• For business and industry, this is a moment of truth. They can either try to anticipate these shifts and invest in resilience, efficiency and innovation, or they can treat sustainability as a compliance exercise, facing the risk of higher costs, operational disruption, and lost markets.
• A similar issue also arises for public policy makers.
• Because, although no one really doubts the necessity of sustainable development, identifying and implementing policies and common approaches with real-world results at scale and with speed, remains tricky.

Europe and the green transition – Request for productivity to become an issue of primary focus

• Europe has rightly chosen to lead the green transition with its ambitious frameworks such as the Green Deal, Fit for 55, and the Clean Industrial Deal.  Greece, and its businesses are aligned with these European goals. We have national plans on carbon emissions, energy transition, and water, and many of our businesses are already investing in cleaner technologies and circular economy models.
• But at the same time, we have to admit that Europe’s approach is disproportionally based on regulation and reporting, instead of targeted investment and speedy execution of the required transformation.
• Over the last few years, thousands of pages of new rules have been produced, compliance costs for CSRD and CSDDD have skyrocketed and CBAM continues not to adequately address the risk of European industry exports’ competitiveness.
• As a result, companies are forced to divert resources from real investments to paperwork and compliance. This would not necessarily be a problem if the results had a meaningful impact on a global scale. But this does not seem to be the case so far.
• Take air pollution: the data in Dr. Damania’s report shows that when China is excluded, pollution and global PM2.5 trends remain largely flat. That means that the real global improvement comes primarily from China. Europe has reduced its emissions, but with limited global impact.
• This raises a difficult but necessary question: are the policies we are designing maximizing real-world impact, or do we need to do something different?
• China reduces pollution without derailing growth and proved that decoupling is possible under certain provisions. That it should be based on the right policy design, investments, innovation, boost of productivity and execution capacity.
• The key therefore is systemic change: stronger institutions, data-driven implementation, and policies aligned with industrial strategy.

We all agree that we must advance decarbonization. But we must do so without jeopardizing European competitiveness or creating carbon leakage and the transfer of European industries outside of the continent. As recent Eurostat data show, European share of consumption emissions as a percentage of total emissions had increased between 2020 and 2023 from 31,5% to 35%, while EU production is declining which points to a substitution of domestic manufacturing production by imports which are usually more carbon intensive.

• I will mention two examples, which in my mind, Europe needs to address and which of course these are not exhaustive.

• The first example concerns Greece. Our country’s serious decarbonization efforts have reduced the carbon intensity of electricity generation by 20% since 2020 due to the closure of lignite plants, islands interconnections and high penetration of renewables in the energy mix. Yet electricity prices remain high and unpredictable. Wholesale electricity prices are increasing and so are other charges, for example charges linked to network charges or balancing market.
• Although renewables have near to zero marginal cost and do not depend on fossil fuel supply chains and commodity price volatility linked to geopolitics, wholesale electricity prices are not decoupled from fossil fuel prices and their respective volatility, especially during tight hours. At the same time, additional system costs increase.
• This teaches us that although higher renewables penetration and clean tech could make energy cheaper and more predictable, this can only occur over the long run, and provided that the power system design and market rules also evolve with them.
• A second example relates to AI. The rapid penetration of AI is extremely energy intensive (24 hours, 7 days a week0, with advanced cooling systems that increase demand for water, while there is growing pressure for certain critical raw materials. Data centers are already amongst the fastest growing sources of electricity use, and if such systems are powered by base load fossil fuel generation capacity, emissions could again grow quickly. So, the question is: will the efficiency gains from AI deployment exceed its energy and materials intensive use?

This brings us to a broader point: productivity. SEV stresses the need to increase productivity as a key priority for policy makers and as a key criterion for providing investment incentives. Because rising productivity is the most viable way to increase wages to preserve our social model, while remaining competitive. It is also crucial for the preservation of our natural systems. Because for low productivity economies, even with the best intentions, protecting nature is a proposition they cannot afford.

When productivity stalls, sustainability suffers.

The role of the World Bank and the message of Richard Damania’s work 

• This brings us to the pivotal role of the World Bank. For decades, the Bank has highlighted the environment’s role as a foundation of development, economic stability, and poverty reduction.
• The central message of Dr. Damania’s report Reboot Development: The Economics of a Livable Planet is both simple and profound: undermining natural capital means undermining the development model itself. This is not an ideological argument. It is a profoundly economic one.
• Economic growth and environmental protection can be aligned, provided they rely on better institutions and policies that integrate nature directly into economic decision-making.
• Dr. Damania’s approach goes far beyond compliance and reporting. It calls for a deeper economic integration of sustainability, where forests, water, and clean air are treated as productive capital, not as regulatory checkboxes.
• The World Bank’s recommendations focus on what actually works: real-time data, policy alignment across sectors, and continuous evaluation to improve and scale what actually delivers results.
• Europe seems to be finally moving to that direction since beginning of 2025, following the Letta and Draghi reports, with initiatives such as the Clean Industrial Deal and the renewed focus on competitiveness and productivity.
• Since January 2025, the European Commission has presented 10 omnibus proposals, aiming to provide significant relief to companies by reducing the regulatory burden by almost €12 billion annually. Omnibus 1, in particular, allows for significant simplification on the scope of CBAM, CSRD, CS3D and on downstream due diligence and reporting standards.
• At the same time, the new Multiannual Financial Framework proposal recognizes the need to strengthen Europe’s competitiveness by better aligning reforms with investments and by linking cohesion policy more directly with the EU’s decarbonization priorities. This shift is also reflected in the creation of the European Competitiveness Fund and its 4 policy pillars, namely the:  Clean Transition & Decarbonisation, Digital Leadership, Health/Biotech &Bioeconomy, and Security&Defence.
• But there is still much that needs to be done to reduce red tape, accelerate green investments, and turn ambition into real transformation.

Dr. Damania,

• Your work inspires us to “reboot” growth—not with fewer goals, but with better design: less bureaucracy, more speed, predictability, and investments.
• Sustainable transition isn’t a checklist—it’s a strategy for strong European and Greek businesses and for social prosperity.
• We at SEV and at its Business Council for Sustainable Development (SEV BCSD) have long championed this shift, helping businesses move from compliance to strategic action on climate, circularity, and resilience.

Because real progress begins when economy moves from exhausting natural resources, to respecting them, with a view to a sustainable future for all.