ESG Essentials: Ban on unsold clothing destruction, Vietnam’s $135 billion plan and climate reparations

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Destruction of unsold clothing could be banned by EU

EU member states have backed a ban on the destruction of unsold clothing to reduce textile industry waste, which is responsible for one fifth of the bloc’s greenhouse gas emissions.

Citizens in the EU discard almost 6 million tonnes of textiles each year and only a quarter of these are recycled, according to the European Commission.

It is often cheaper for retailers to discard or destroy returned items than to process them for resale. Designer brands also frequently destroy unsold clothing to prevent resale on the black market.

Member states are expected to vote on the law this week. This vote reflects the growing concern for reaching sustainability targets and waste reduction in the textile industry.

Vietnam’s $135 billion plan to fuel the future of renewable energy 

Vietnam has announced it has approved a long-awaited $134.7 billion plan to reduce its coal use by 2030, with the aim for total phase-out by 2050. This brings much-needed clarity to the country’s renewables sector, which has so far struggled to attract investment. 

The strategy has been delayed for years due to a focus on anti-corruption and the need to cope with rising energy prices after Russia’s invasion of Ukraine. 

This step highlights Vietnam’s recognition of the significant challenges and risks that the country is facing. Ho Chi Minh City, Vietnam’s business and financial hub which contributes 23 percent of Vietnam’s GDP, is among the most vulnerable cities to rising sea levels globally.

Vietnam’s climate ambitions should be strongly supported as a crucial example of whether rapidly developing middle-income nations can transition to a greener economy in the timescale required to contribute to global climate goals, whilst also providing a just transition for affected communities.

On Thin Ice: the 1.5C limit could be surpassed within 5 years

The World Meterological Organization (WMO) has warned there is a 66% chance we will pass the 1.5C global warming threshold between now and 2027. Passing this threshold would be a first in human history. 

This is partly caused by the return of the El Niño weather phenomenon by the end of this year, which involves abnormal warming of the Pacific Ocean, and is expected to cause worldwide weather disruptions and amplify global temperatures.

Although WMO scientists stress that although this temperature breach is serious, it will likely be temporary and does not necessarily mean the Paris Agreement will go unmet. However, breaking this limit represents a worrying sign that warming is accelerating rather than slowing down.

Putting a price on polluters

A groundbreaking study released last week by One Earth has calculated that the world’s top fossil fuel companies owe reparations of at least $209 billion annually to the communities most damaged by their business.

The report names the largest 21 polluters, including BP, Shell, ExxonMobil, Saudi Arabia’s state oil company and Chevron, all who have contributed to $5.4 trillion worth of damage related to climate change.

This is the first time that the economic impacts of individual fossil-fuel companies have been quantified. The paper presents a case for carbon corporations to use some of their wealth to compensate victims of the climate crisis. 

The development of an evidence-based “polluter pays” price tag is a crucial step towards achieving climate justice for communities and nations that have made the smallest contributions, yet suffer the greatest losses due to climate change.

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