Global Implications of Socio-Technical Change

Klimawandel und Unsicherheit: Wie geht die Gesellschaft damit um?

slz — Mon, 04 Mar 2024 09:29:16 +0000

Tackling Climate Change and Uncertainty in Risk Governance slz Mon, 03/04/2024 - 11:07

Sabine Letz

Book section

ore

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Systemic risks

Against the backdrop of broad scientific debate on the risks posed by climate change, questions remain as to how societies should respond and what specific measures should be adopted. Scientific analyses and forecasts are always characterised by uncertainties and ambiguities that give rise to public debate and conflicts. Science alone cannot determine the extent of the risks posed by climate change as these are shaped by the dynamic interplay of natural responses to climate change and human behaviour. Taking this into account, the first step in a risk analysis, the so-called pre-assessment, entails an in-depth investigation of the conditions that affect both the drivers of climate change and the available options for mitigation as well as their political feasibility.

Early public consultation a must

Renn draws on the example of flood prevention and control to explain the “pre-assessment phase” in the IRGC's four-stage concept, which aims to clarify responsibility for preventive measures as well as the legal and political feasibility of basic flood protection options and their financing. According to Renn, public consultations in the form of a “climate dialogue” is essential to addressing people’s perspectives, concerns and fears and obtaining agreement in principle to proposed measures. So-called co-creative approaches, in which protective measures are designed and implemented together with affected communities, are particularly promising. Local residents often call for the development of technical measures such as higher embankments. Environmental associations, on the other hand, tend to favour polders, whereas regional planners often prefer to modify building regulations and planning specifications. It is important that all of these perspectives are included in the risk assessment.

In the second step, scientific methods are used to identify, characterize and – if possible – quantify risks and hazards. Their potential impacts on human health and the environment, the economy and social stability, for example, should also be considered in an analysis of the risk perceptions, fears and attitudes of important social groups and affected communities. Interest groups and affected communities should be involved from here on in order to identify the full range of concerns and ensure that these are reflected in possible solutions and to secure the broadest possible backing.

Weighing the anticipated consequences of solutions

In the third phase, all available data is collated, interpreted and evaluated. Weighing the uncertainties that arise in any risk analysis is especially challenging. The IRGC recommends engaging stakeholders in a risk dialogue that brings together representatives from local government, climate scientists and stakeholders from the field to identify climate impact scenarios that will serve as starting points for the development of risk management options.

Finally, the fourth phase focuses on making decisions about concrete strategies to combat the causes of climate change (mitigation) on the one hand and to adapt to the unavoidable consequences of climate change (adaptation) on the other. These strategies aim to reduce risks in order to avoid extensive damage and losses as far as possible.

The IRCG concept treads new ground by drawing on expertise from the social and economic sciences alongside the natural and technical sciences in the identification, assessment, and management of risks, writes Renn. It is not enough, he argues, to develop new technologies and systemic solutions; rather, the success of climate policy must be measured by its ability to reconcile what is technically possible with that which is socially desirable.

Publication:
Renn, O. (2023). Klimarisiken: Umgang mit Unsicherheit im gesellschaftlichen Diskurs. In G. P. Brasseur, D. Jacob, & S. Schuck-Zöller (Eds.), Klimawandel in Deutschland (2., überarb. u. erw. Auflage, pp. 391-402). Berlin, Heidelberg: Springer Berlin Heidelberg. DOI: 10.1007/978-3-662-66696-8_30.

The International Risk Council's concept of risk management is divided into four stages: from identifying the situation and analyzing the risk to taking countermeasures and communicating the risk. Shutterstock/ ALamphad

Systemic Risks Experts from politics, business, science and civil society can and should be involved in efforts to identify, analyse, and reduce risks relating to climate change. Prof. Ortwin Renn outlines the four stages of the risk governance framework developed by the International Risk Council’s (IRGC): from a pre-assessment and appraisal of risks and concerns, through to the evaluation and the implementation of risk governance. 2403_Risikomanagement abstrakt engl

Experts from politics, business, science and civil society can and should be involved in efforts to identify, analyse, and reduce risks relating to climate change. In a chapter in the anthology Klimawandel in Deutschland (“Climate Change in Germany”), Prof. Ortwin Renn outlines the four stages of the risk governance framework developed by the International Risk Council’s (IRGC): from a pre-assessment of the situation and appraisal of risks and concerns, through to the evaluation of risks and the implementation of risk governance measures as well as risk communication and public participation.

Systemic Risks Systemic Risks Global Implications of Socio-Technical Change Systemic Risks 0

Industrie 4.0: Weder positiver noch negativer Einfluss auf Energieverbrauch

slz — Tue, 28 Nov 2023 08:38:45 +0000

No Significant Link Between Industry 4.0 and Energy Consumption Or Energy Intensity slz Tue, 11/28/2023 - 10:52

Sabine Letz

Study

skl

slz

Digitalisation

China accounts for 30% of global manufacturing value added and the largest share of global manufacturing and industrial output. There are widespread expectations that Industry 4.0 – the comprehensive digitalisation of industrial production processes – will simultaneously boost economic growth and achieve energy-savings targets. However, there is disagreement within the scientific community as to whether Industry 4.0 can in fact reconcile these two goals.

A study by the Research Institute for Sustainability (RIFS) analysed ten Chinese manufacturing sectors between 2006 and 2019 with the aim of identifying correlations between Industry 4.0 and energy indicators. Although some studies have already analysed the impact of digital technologies on energy consumption, few have focussed on the Chinese context. “Moreover, previous studies did not properly address the concept of Industry 4.0," says lead author Stefanie Kunkel. “For example, some studies of Industry 4.0 in the Chinese context oversimplified the concept and equated the use of robots in manufacturing with artificial intelligence, for example. In doing so, these studies ignore the knowledge and innovation dimensions of Industry 4.0.” In addition, few of the previous studies examined aggregate energy consumption. Instead, most focused on relative energy consumption or energy efficiency. However, gains here can distract from the goal of reducing total energy consumption, which is vital for the decarbonization of the industrial sector.

Is there a significant link between industry 4.0 and energy consumption?

The main aim of the study is to understand the extent to which the uptake and degree of Industry 4.0 technologies impacts on overall energy consumption and energy intensity in the Chinese manufacturing sector – and whether the thesis that Industry 4.0 contributes to efficiency and thus energy savings is supported by statistical findings.

The term “energy intensity” measures the energy consumed within a given sector per euro of output. Kunkel and her co-authors conducted a panel data analysis that included data from ten industrial sectors over a period of 14 years (2006 to 2019). The manufacturing sectors covered included the textile industry, metal industry and the food industry, among others.

Digital rebound and growth versus efficiency effects

As far as total energy consumption in the manufacturing sector in China is concerned, the results show that there is no significant link between the degree of Industry 4.0 and energy consumption. "The relationship is positive, but not significant," comments Kunkel. For example, using robots instead of manual labour in textiles manufacturing, which is currently less digitalised, may likely increase energy consumption in that sector. So-called "digital rebound effects" often occur when efficiency gains achieved through digitalisation lead to cost savings. These savings can then be fully or partially reinvested, thus neutralizing some or all of the efficiency gains and thus expected resource savings. In addition, digitalisation generally has a growth-promoting effect, which is also likely to increase energy consumption.

The findings of Kunkel et al. contradict other studies, which found that the use of robots and industrial digitalisation reduced the energy intensity of industry and manufacturing – in other words, that they delivered efficiency gains. The RIFS study, on the other hand, was only able to identify a negative correlation between Industry 4.0 and energy intensity for sectors that are already highly digitalised. One explanation for this could be that Industry 4.0 innovations can be better integrated into strongly digitalised sectors, such as transport, enabling potential gains in efficiency to be realised to a greater degree.

One challenge for the analysis of the effect of industry 4.0 on energy indicators is that digitalisation-related offshoring and thus reductions in energy intensity may be attributed to digitalisation itself. In order to partially capture such effects, Kunkel et al. included the indicator "CO2 imports" as a proxy for the energy intensity of imported goods. There were significant positive associations between CO2 imports and the extent of Industry 4.0, which suggest that an increasing degree of Industry 4.0 is associated with increasing CO2 imports. However, further research is needed to understand the underlying dynamics.

Conclusion

Energy consumption in industry accounted for 37% of global energy consumption in 2022, with China accounting for the largest share. Reducing energy consumption and improving the environmental performance of industrial production in China will therefore be critical to efforts to mitigate climate change.

A key finding of this RIFS study is that focussing exclusively on potential gains in energy efficiency through digitalisation can undermine efforts to achieve sustainability goals and decarbonise industry as growth and offshoring dynamics driven by digitalisation may result in an overall increase in energy consumption. Other factors must be considered, such as impacts on industrial offshoring, the sector-specific impacts of different digital technologies, human capabilities to enable the absorption of innovations and harness their benefits for sustainability, as well as the simultaneous integration of renewable energy in industrial manufacturing.

In addition to energy variables, Kunkel et al. also recommends including other sustainability indicators such as resource consumption and electronic waste from digital technologies in future studies on the sustainability of Industry 4.0. Such analyses of the relationship between energy and Industry 4.0 are of considerable relevance to industry representatives and political decision-makers beyond China. The European Union and countries around the world are hopeful that digitalisation can be harnessed in the pursuit of more sustainable development. This study shows that achieving this outcome is not a given, but that it will require careful steering.

Summary and recommendations

Firstly, efforts should be undertaken through international cooperation and supply chain agreements to ensure that the adoption of Industry 4.0 innovations in the manufacturing industry reduces energy and resource demands along the entire value chain. This could help to prevent the increased offshoring of energy-intensive manufacturing processes to countries with lower environmental standards in the context of Industry 4.0.
Secondly, further research is needed to improve understanding of the mechanisms and effects through which specific technologies affect energy consumption in industry and manufacturing. This would help to identify innovations in the field of Industry 4.0 with the capacity to reduce the overall environmental burden of industry and how policy and industry can support their uptake.
Thirdly, the growth-accelerating effects of Industry 40 should be steered towards achieving sustainability targets such as decarbonization and the development of a circular economy.

Publication:

S. Kunkel, P. Neuhäusler, M. Matthess and M.F. Dachrodt: Industry 4.0 and energy in manufacturing sectors in China. Renewable and Sustainable Energy Reviews, Volume 188, 2023. DOI: https://doi.org/10.1016/j.rser.2023.113712

Energy use in 10 Chinese manufactoring sectors. own elaboration using icons from Flaticon

One conclusion of the RIFS study is that the often postulated mantra of "increasing energy efficiency through digitalization" is mostly ineffective for sustainability goals and the decarbonization of industry. RIFS/ Kathleen Friedrich

Digitalisation To what extent does the digitalisation of industrial and manufacturing processes (Industry 4.0) improve energy efficiency and thus reduce energy intensity? A team from the Research Institute for Sustainability (RIFS) analysed developments across ten industrial manufacturing sectors in China between 2006 and 2019. Their findings show that contrary to the claims of many policymakers and industry associations, digitalisation may not automatically lead to anticipated energy savings in manufacturing and industry in China. 2311_Digitalissierung Stefanie Kunkel eng

To what extent does the digitalisation of industrial and manufacturing processes (Industry 4.0) improve energy efficiency and thus reduce energy intensity? A team from the Research Institute for Sustainability (RIFS) analysed developments across ten industrial manufacturing sectors in China between 2006 and 2019. Their findings show that contrary to the claims of many policymakers and industry associations, digitalisation may not automatically lead to anticipated energy savings in manufacturing and industry in China.

Digitalisation and Impacts on Sustainability Digitalisation and Sustainability Transformations Global Implications of Socio-Technical Change 0

Some Move with Speed and Grace, Others Slide and Goo…

bsc — Mon, 28 Aug 2023 06:16:39 +0000

Some Move with Speed and Grace, Others Slide and Goo… bsc Mon, 08/28/2023 - 08:16

Marianne Pascale Bartels

Dr. Gretchen Bakke

Marianne Pascale Bartels

Dr. Gretchen Bakke

To what, exactly, are we referring, you may ask?

The second largest group of invertebrates on Earth are the ‘Phylum Mollusca’, a very broad group of creatures that includes everything from squid to snails. A widespread, diverse and poorly studied group, the molluscs live across marine, freshwater and terrestrial habitats. In their diversity, as much as in their specificity, these creatures both inspire and surprise. This has long been true. However, in something resembling a renaissance, scholars, designers, and fishers are turning toward edible bivalves (oysters, mussels, clams and scallops) for a host of reasons: as a form of archival knowledge, as interesting tools for conservation, environmental restoration, environmental design, as forms of carbon sequestration, as a food source and as an overall force for good.

Environmental designers may focus on oysters, for example, as modes of protecting low-lying or swampy shoreland from higher tides and storm surges, while biologists study the filtering capacity of both oysters and mussels to help clean toxic and silty waters. Geologists reconstruct paleoenvironments and track their origin and evolution from the Cambrian period, while anthropologists and historians are interested in cultivation practices which give rise to alternative economies of extraction and contribute to the flourishing of communities at the fringes of capitalism.

In a new research project at RIFS, we follow this turn toward oysters, mussels, clams and scallops, specifically as objects of hopeful activity and their transformative potential in a time of planetary crisis. Our aim is to bring together interested scholars from across these disciplines and beyond to share knowledge about what these bivalves are and how they live, but also how they pull diverse interests to them while giving rise to new conceptualizations, practices and stories about how to live differently in the communities and environments that sustain us.

Shutterstock/Artinblackink

Postdoctoral Fellowships shutterstock_Artinblackink.jpg

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mba gbak Planetary Geopolitics and Geoengineering Global Implications of Socio-Technical Change

Digitalisierte Branchen nicht immer widerstandsfähiger als nicht digitalisierte

slz — Tue, 11 Jul 2023 08:30:03 +0000

Digital-Intensive Industries Not Always More Resilient slz Tue, 07/11/2023 - 10:30

Sabine Letz

Data Analysis

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slz

In 2020, the global spread of the SARS-CoV-2 virus led to a year-on-year decline in global economic activity of 3.5%. In Germany, too, key economic indicators declined across all sectors during the crisis; however, not all sectors were equally affected. Observed differences in sectoral resilience in this context have stimulated debate about the potential benefits of digitalisation for the economy (through automation and remote working, for example) and prompted calls to embrace digitalisation more broadly. However, according to a new study prepared by a team of researchers at RIFS, the connection between the digital intensity of sectors and their economic performance during the pandemic is less than clear cut, with only limited evidence available for this period on sectoral socio-economic performance and digital intensity.
In order to uncover differences in socio-economic resilience to the COVID-19 crisis between more and less digitalised industry sectors in Germany, the researchers analysed sectoral stock market performance, gross value added (GVA) and sectoral employment data and linked this to data relating to the digital intensity of various sectors in Germany during the pandemic year of 2020.

According to the team of researchers, the results of this analysis do not confirm the hypothesis that highly digitalised sectors consistently proved more resilient in the context of the Covid-19 crisis. High and medium-high digital intensity sectors did perform better on stock markets than sectors of low and medium digital intensity. However, a high degree of uncertainty and stock market volatility is detrimental to the resilience of the economy.

Less digitalised sectors outperformed high and medium-high digital intensity sectors in terms of GVA and employment in 2020, with the exception of the information and communication sector. Notably, the data shows that low and medium-low digital intensity sectors such as public administration, education, defence, health, social work, and construction were the only sectors that saw employment gains during the pandemic.

“These observations led us to the hypothesis that digitalisation may not be a silver bullet to achieving social and economic resilience in times of crisis," explains lead author Stefanie Kunkel. And while the improved stock market performance of highly digitalised sectors is relevant for investors, the evidence suggests that less digitalised branches of the public sector such as health and education played a crucial role in maintaining employment stability and reducing the adverse socio-economic impacts of the crisis.
However, Kunkel and her co-authors point out that the study does not establish causal relationships. The authors conclude that financial support programmes significantly strengthened the resilience of multiple sectors throughout the crisis, with some studies going one step further to argue that state aid was the main driver of resilience.

Recommendations for economic policy

Policies with a narrow focus on promoting digitalisation to mitigate future crises could prove to be misguided. Not only does digitalisation result in changes in job profiles, potentially favouring better skilled workers and leading to increased wage inequality, it also presents ecological risks such as increased energy and resource consumption. Instead, during crises, policy measures that promote resilience and financial support programmes should focus on strengthening social and environmental resilience by targeting sectors that foster stability and support a broader socio-ecological transformation in line with international sustainability goals, such as the United Nations Sustainable Development Goals.

Recommendations for companies

The authors recommend that companies should seek to create work environments in which remote and on-site tasks are evenly distributed among employees in order to avoid widening the digital divide within the workforce in times of crisis. Digital technologies should also be used to measure environmental parameters and impacts, reduce energy and material consumption along supply chains, and identify more environmentally friendly business models and practices such as circular material flows. This could enable employees to benefit more equally from digitalisation during future crises, enhance their digital competencies, and align social, economic, and environmental goals.

Ultimately, this analysis raises an important question for efforts to mitigate the negative effects of future crises for people and the planet: Which factors must be addressed by industry and policymakers in order to steer the effects of digitalisation towards improving socio-economic and environmental outcomes? This would be an important departure from many current political and economic agendas that focus purely on creating economic gains through digitalisation.

Publication:

Stefanie Kunkel, Simon Terhorst und Grischa Beier: Digitalisation and resilience of industry sectors: a descriptive analysis of the COVID-19 crisis in Germany, Int. J. Technological Learning, Innovation and Development. DOI: 10.1504/IJTLID.2023.10055714.

Digitization not only leads to changing job profiles, but also poses ecological risks such as increased energy and resource consumption. Shutterstock/ TippaPatt

Digitalisation It is widely assumed that digitalisation improves the capacity of companies and sectors to cope with crises. But is it the case that digital intensive sectors proved more resilient during the Covid-19 crisis? Researchers from the Research Institute for Sustainability (RIFS) investigated this by analysing data relating to various socio-economic indicators pre- and post-crisis. Their findings are surprising: In some cases, less digital-intensive industries were actually more resilient. Pandemic-related assistance provided by the German government is one possible explanation for this. 2307_Digitalisierung eng

It is widely assumed that digitalisation improves the capacity of companies and sectors to cope with crises. But is it the case that digital intensive sectors proved more resilient during the Covid-19 crisis? Researchers from the Research Institute for Sustainability (RIFS) investigated this by analysing data relating to various socio-economic indicators pre- and post-crisis. Their findings are surprising: In some cases, less digital-intensive industries were actually more resilient. Pandemic-related assistance provided by the German government is one possible explanation for this.

Digitalisation and Impacts on Sustainability Digitalisation and Sustainability Transformations Global Implications of Socio-Technical Change 0

Compliance, ESG, and Social Media in Brazil

dha — Wed, 10 May 2023 14:13:30 +0000

Compliance, ESG, and Social Media in Brazil dha Wed, 05/10/2023 - 16:13

Giovanni Mascarenhas

ESG frameworks can help corporate actors to manage their environmental, social, and governance commitments and improve the sustainability of their activities. Shutterstock / ThitareeSarmkasat

I was recently asked if environmental, social and corporate governance (ESG) frameworks are merely another take on corporate compliance or perhaps just “compliance with extra steps”. While I was thinking about how this distinction works in practice, a perfect example emerged a few days later, when the regulation of social media platforms moved to the centre of political debate in Brazil.

In the legal field, compliance was seen, for the best part of the last decade, as an innovative field that would factor in the Profit and Losses Statements (P&L) of companies, as a lack of compliance could prove expensive in the medium and long terms. While “compliance” means nothing more than complying with the regulations applicable to a given activity, the concept of ESG extends beyond the regulatory dimension. ESG frameworks are constituted by factors that may be more or less material in terms of their weighting within a company's P&L statement. In other words, ESG focuses on factors such as the relationship between a company and its suppliers and consumers, how it operates in the community, how it deals with government authorities, and how its activities affect the natural environment.

Thus, while compliance is concerned with legislation and regulations, ESG factors range from the direct impacts associated with business operations (Scope 1) to broader concepts that consider the indirect impacts associated with both upstream suppliers and downstream users of products (Scope 3), including the energy impacts of operations (Scope 2). While making an objective assessment of a company’s compliance is relatively straightforward, assessing the success of ESG efforts requires us to map specific pathways from ESG factors to a company’s P&L. It is through this mapping exercise that the relationship between compliance, ESG and social media platforms can be understood .

The regulation of social media platforms has been the subject of intense debate in Brazil following a string of attacks in schools, which took place in the months after the 2023 attack on the Brazilian Congress, Supreme Court and Presidential Palace. In both cases, the perpetrators openly announced their intentions or planned the attacks on social media platforms. High-ranking executive members of the Federal Government and even ministers of the Supreme Court have already spoken out in favour of tightening regulations on social media, and Congressional Bill No. 2630 (PL 2630/2020), which proposes a new framework for the regulation of social media, has become the focus of intense political debate in Brazil.

The current legislation governing the processing of user data and the moderation of user content (the Internet Civil Rights Bill, or Marco Civil da Internet and the General Personal Data Protection Law) guides the compliance efforts of social media companies like X Corp (Twitter) and Meta (Facebook) in Brazil. The Marco Civil grants platforms considerable freedom to self-regulate their activities and they can only be compelled to remove user content by a court order (a few exceptions exist but are not relevant here).

Nonetheless, recent debate on the regulation of social media touched on factors that fall within the scope of ESG. Governments are critical stakeholders for tech and social media companies, as they rely on policymakers taking a light touch to the regulation of their products. While it may seem unthinkable that a government could establish an agency to regulate the introduction and operation of new technologies (including the algorithms that power social media platforms), the social, political, and public health impacts of social media could easily justify the creation of an organisation similar to the European Medicines Agency (EMA) or the US Food and Drugs Administration (FDA). And indeed, the original text of Congressional Bill No. 2630 proposed the creation of a government agency to monitor the regulation of social media. The idea was dropped following a publicity campaign arguing that this would amount to the creation of a "ministry of truth" that would police opinions contrary to government interests.

Identifying the lack of regulation as an important element and the government as a crucial stakeholder is an important part in the exercise of mapping pathways from ESG factors to P&L statements. Poor stakeholder relations – the often turbulent relationship between Twitter's Elon Musk and various governments, for example – invite government interventions that would impose regulations on companies accustomed to operating with very little oversight.

One of the most important principles of ESG is that shareholder value growth has to be pursued in a sustainable manner. That is, with attention to how a company interacts with and influences the natural environment, communities and consumers, governments and other stakeholders. The power and influence of social media platforms have long been a social issue (see, for example, Facebook’s role in outbreaks of violence in Myanmar and Ethiopia), and the lack of action to better factor ESG elements into social media operations is likely to eventually result in a tightening of regulations, which will directly affect the profitability of tech companies.

Hopefully, this concentration of power at the expense of society, consumers, and governments, will eventually be corrected. In Brazil, it is probable that this correction will begin with the adoption of legislation that transforms elements of the first and third scopes of ESG into compliance requirements (relating to company operations and indirect impacts). However, this is unlikely to reflect the full complexity of environmental, social and corporate factors that should be taken into account in operations that claim to be sustainable. And while the imposition of minimum standards is undoubtedly an improvement, it cannot undo the damage already done nor can it bring back the lives lost as a consequence of algorithms promoting hate speech and extremist content on social media platforms. More significant changes are likely to be driven by the efforts of other important stakeholders, such as consumers and the community, who can demand change and pressure providers by boycotting services that profit from promoting fake news and hate speech.

Governance ESG_handumdrehen

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Giovanni Mascarenhas Democratic Governance for Ecopolitical Transformations Democracy and Sustainability Global Implications of Socio-Technical Change Brazil: Strengthening Resilience in Times of Crisis

Nachhaltige Industrie durch digitale Lieferketten?

bsc — Mon, 06 Mar 2023 13:43:11 +0000

Sustainable industries through digital supply chains? bsc Mon, 03/06/2023 - 16:04

Dr. Stefanie Kunkel

Containers in a port

By Calvin Hanebeck (Uni Potsdam), Gereon Mewes (Minerva University) and Stefanie Kunkel (RIFS)

Digitalisation has transformed the way we communicate and collaborate with friends, family, and colleagues. In a similar vein, digitalisation in industry – the so-called industry 4.0 – is expected to transform the way firms and their suppliers collaborate in global supply chains. Considering that 25 percent of global emissions in 2021 were generated by industry (IEA): Can industry 4.0 play a role in greening industrial supply chains? Researchers at the Research Institute for Sustainability (RIFS) at the Helmholtz Centre Potsdam explored the opportunities and risks of digital supply chains for environmental sustainability. In short: sustainability does not simply occur as a by-product of digitalization. Firms should aim to increase sustainability levels in their supply chain – whether through digital or non-digital means.

Background

Supply chains are becoming increasingly digital as firms move towards industry 4.0 in their operations. They create so-called cyberphysical systems to enable interconnectivity and autonomous production across firms and even countries in global supply chains. These digital supply chains are expected to reduce costs for and foster collaboration between firms in different countries. They are also expected to promote the exchange of information about environmental sustainability, such as energy use and emissions data, and facilitate collaboration on topics like sustainable innovation and circular economy across firms. In light of these possibilities, the question arises how far firms have already realised digital supply chains, and how they affect sustainability in practice. To answer these questions and gain insights into firms’ experiences with digital supply chain collaboration researchers from the Research Institute for Sustainability (RIFS) in Potsdam conducted a study interviewing Chinese suppliers and international buying firms in the electronics sector. This article summarises some of their findings.
Varying levels of digital maturity

Not all firms have the same level of digital maturity in their supply chains. In the study, the RIFS researchers distinguished between low, intermediate, and high digital maturity in digital supply chain collaboration. Low digital maturity is associated with the use of telephone and paper communication, intermediate digital maturity with email, office software, electronic data interchange, or Enterprise Resource Planning (ERP) systems, and high digital maturity with the use of industry 4.0 key technologies, such as the internet of things (IoT), big data analytics (BDA), artificial intelligence (AI), cloud computing, and additive manufacturing.

Digital maturity in collaboration. Source: own elaboration based on Bickauske et al. (2020) and Shao et al. (2021).

Opportunities, risks, and obstacles of digitalisation for sustainable supply chain collaboration?

The researchers asked about the opportunities, risks, and obstacles related to digitalisation for sustainable supply chain collaboration.

Opportunities

Firms perceived digitalisation as a facilitator for green innovation and knowledge transfer. There was also interest in the role of digital technologies to facilitate measurement of CO2 emissions along the supply chain, although firms were not aware of specific digital solutions for such measurements. Another opportunity cited was the environmental optimisation of logistics chains, such as shortening truck fleet routes through algorithmic optimisation. Lastly, digital technologies were expected to help increase material circularity. Several firms mentioned the expectation of enhanced recycling collaboration supported by digital supply chains, for instance, by tracking and reusing containers and reusable packaging, which could reduce the amount and cost of packaging.

Risks

The interviews revealed that, despite high expectations, neither suppliers nor buying firms intensively used digital technologies for sustainability collaboration in the supply chain. While most firms recognised the potential of digital supply chains for energy and material efficiency gains, they did not yet realise these potentials. Instead, they seemed to use digital technologies for marketing or economic optimisation purposes rather than for sustainability. This poses a risk of optimising and accelerating unsustainable business models through digital supply chains, instead of fostering transformative business models. Moreover, digital rebound effects may occur, where efficiency improvements make energy use cheaper, which may, in the worst case, lead to increased energy consumption.

Obstacles

Firms mentioned that a shortage of skilled personnel made it difficult to implement digital sustainability solutions. Additionally, some firms were hesitant to use more digitally mature technologies due to concerns about data safety. The digital infrastructure was perceived as insecure for sensitive intellectual property, such as industrial innovations, to be shared. Finally, weak regulations contributed to limited interest in monitoring environmental indicators.

Conclusion on digital supply chains

The researchers concluded that there was currently limited digital supply chain collaboration on sustainability. Firstly, few firms appeared to have a high level of digital maturity in supply chain collaboration at all. Secondly, a lack of incentives for firms to collaborate on sustainability through digital supply chains was identified. As a result, digital technologies were primarily reported to be used for economic purposes. This was found to carry the risk of improving unsustainable business models and creating rebound effects. Thirdly, the supply chain was not considered in its entirety. Upstream suppliers (closer to the sourcing of raw materials) were rarely taken into account in digital supply chain collaboration, even though sustainability risks may be high.

A way forward? Recommendations for more sustainable digital supply chains

To enhance environmental sustainability in digital supply chains, the RIFS researchers make the following three recommendations for policy makers and businesses:

Foster digital environmental upgrading: Digitally mature firms being more active in the sustainability sphere should support less mature firms in collaborating on sustainability through digital technologies, for instance, by fostering sustainability data gathering and exchange, providing (online) trainings on sustainability practices, and transferring knowledge about more environmentally sustainable operations.
Create economic and environmental win-win situations: Firms should create a business case for (digital) sustainability collaboration. They should develop strategies that both save money and enable more environmentally friendly operations through digital collaboration, such as by monitoring energy use across firms to identify cost savings potential.
Improve legal environment: Policymakers should implement regulation to ensure that firms have an obligation to create sustainable (digital) supply chains (positive steps in this direction being the EU Proposal on Corporate Sustainability Due Diligence Directive (CSDD) and the EU Corporate Sustainability Reporting Directive (CSRD)).

Graphical summary of the study Industry 4.0 in sustainable supply chain collaboration: Insights from an interview study with international buying firms and Chinese suppliers in the electronics industry

This article was first published on 1 March, 2023, on the HIIG blog.

Container in einem Hafen

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skl Digitalisation and Sustainability Transformations Global Implications of Socio-Technical Change

Digitalisierung der Industrie: Ungleichheiten können nachhaltige Entwicklung gefährden

bsc — Mon, 28 Nov 2022 09:14:56 +0000

Industry 4.0: Uneven Uptake Could Jeopardise Sustainable Development bsc Mon, 11/28/2022 - 10:38

Dr. Bianca Schröder

Sustainable Development Goals

sir

bsc

“Environmental management along the supply chain can be enhanced through the use of digital technologies to facilitate a continuous flow of information and improve transparency. This can reveal threats to sustainability such as offshoring to countries with lower social and environmental standards, and offers insights into opportunities to improve the sustainability of global value chains”, explains lead author Silke Niehoff (IASS). Investment in digital tools and knowledge is currently lacking in some developing countries.

The study compares the development of digitalisation in the emerging markets of China and Brazil and the industrialised economy of Germany. Employees from companies of different sizes and across several sectors were surveyed. The results offer insights into how digital transformations unfold in countries with very different starting points.

Smaller companies lagging behind

The researchers were able to show that differences in the digitalisation of value chains are not as pronounced at the country level as experts had predicted. However, clear differences emerged within all countries with respect to the level of digitalisation achieved across sectors and within companies of different sizes. Across all countries, fewer than 10 percent of the companies surveyed reported plans to fully digitalise collaboration processes. A partial digitalisation is more common: 46 percent of Brazilian, 61 percent of Chinese and 63 percent of German companies already operate in this way.

In all three countries, large companies make greater use of the opportunities offered by digitalisation than small and medium-sized enterprises (SMEs). "It is important to remember that SMEs form the backbone of countries’ economies and they should not be left behind. Global governance is needed to identify uneven development at the country level and strengthen national support policies for SMEs where necessary”, says co-author Grischa Beier (IASS).

Progress on the digitalisation of collaboration processes differs among larger and smaller companies. (c) IASS

The sustainability of production processes could be improved by fully integrating production data into companies’ environmental management systems. This would potentially simplify compliance with environmental standards and certification processes for companies and regulators, which often require analyses spanning the entire value chain. However, only 9 percent of German, 3 percent of Brazilian and 6 percent of Chinese companies have fully integrated production data into their environmental management systems.

The automotive industry as a digitalisation frontrunner

In Germany, 84 percent of respondents from the automotive sector reported at least the partial digitalisation of collaboration processes, compared with 72 percent of Chinese and 62 percent of Brazilian companies. More than in the other sectors covered in this survey, respondents from the automotive sector reported that digitalisation had led to a decrease in the number of partners, while the quality of cooperation had improved as a result. According to the authors, the automotive sector is an interesting field for future research and other companies could learn much from an evaluation of the experiences gained in this sector.

Comparison of the characteristics of digital collaboration processes in the automotive sector with other sectors. (c) IASS

Publication:

Niehoff, S., Matthess, M., Zwar, C., Kunkel, S., Guan, T., Chen, L., Xue, B., de Oliveira Pereira Grudzien, D. I., Pinheiro de Lima, E., & Beier, G. (2022). Sustainability related impacts of digitalisation on cooperation in global value chains: An exploratory study comparing companies in China, Brazil and Germany. Journal of cleaner production, 379: 134606. https://doi.org/10.1016/j.jclepro.2022.134606

Digitalisation is expected to influence market access and the positioning of companies within sustainable value chains. Shutterstock/Pand P Studio

The ninth United Nations Sustainable Development Goal aims to promote inclusive and sustainable industrialisation. Digitalisation is expected to influence market access and the positioning of companies within sustainable value chains. Individual countries or sectors that are slower to adopt digital technologies risk being left behind in this transformation. A new study offers insights into the uneven uptake of digital technologies and its implications. Digitalisierung

Digitalisation and Impacts on Sustainability Digitalisation and Sustainability Transformations Global Implications of Socio-Technical Change 0

Europa braucht mehr strategisches Krisenmanagement

slz — Mon, 21 Nov 2022 17:39:03 +0000

Europe needs more strategic crisis management slz Tue, 11/22/2022 - 13:57

Sabine Letz

SAPEA

slz

Systemic risks

Academies advise European Commission

Europe's academies and networks played a central role in the scientific advice on crisis management handed to European Commissioners in the European Parliament in Strasbourg. IASS Director Ortwin Renn of the Institute for Advanced Sustainability Studies (IASS) also contributed to the report.

At the Commission’s request, independent experts from SAPEA, which is part of the Commission’s Scientific Advice Mechanism, presented an Evidence Review Report to Commissioners Gabriel and Lenarčič. This report contains the latest scientific evidence and evidence-based policy options on how the EU can improve its strategic crisis management which and informed the Scientific Opinion of the European Commission’s Group of Chief Scientific Advisors.

SAPEA is a consortium of academy networks that includes over a hundred academies, young academies, and learned societies. The Chair of the SAPEA Board, Antonio Loprieno, says that "we gathered the best scientists from around Europe to provide an interdisciplinary report on crisis management". This report will be the basis not only for quality policy proposals, but also for much further academic work on the topic, Loprieno added.

The Evidence Review Report by SAPEA highlights that strategic crisis management needs to be aligned with broader policy objectives: "Crises are becoming the norm, not the exception. The strategic decisions we make during crises shape our society in the long run" says the Chair of the SAPEA working group, Prof. Tina Comes.

The report also stresses that crises are changing in nature, crossing borders and sectors, and having cascading and overlapping effects on society, the economy, and the environment. They amplify inequalities and hit the most vulnerable the hardest. Therefore, the EU needs to rethink approaches to risk and crisis management.

The Group of Chief Scientific Advisors are seven eminent scientists who advise European Commissioners on big societal challenges informed by SAPEA’s scientific evidence. Among others, the advisors make the following recommendations:

The EU should plan and prepare for the entire timescale of crises, from preparedness to response and recovery.
The EU should create stronger synergies across European institutions and between European Institutions and Member States; the Emergency Response and Coordination Centre could play a larger role in facilitating the exchange of information and needs.
To increase the EU’s resilience, the Advisors advocate for more scalable, rapidly deployable, and efficient EU financial tools.
Decision-makers at all levels should also work closely with civil society and the private sector.

Alongside scientific reports, the European Group on Ethics in Science and New Technologies published a statement that highlights that the fundamental European value of solidarity is essential. Solidarity can be a guiding principle for overcoming crises and strengthening societal resilience.

The Publication you can download here.

Background

The Scientific Advice Mechanism

The European Commission’s Scientific Advice Mechanism provides independent advice on request to the College of European Commissioners to inform policymaking. For this topic, a working group of Europe’s top experts was convened by SAPEA to produce an Evidence Review Report, summarising the current state of knowledge on crisis management from academia to practice and across many disciplines. Informed by this evidence, the Group of Chief Scientific Advisors published its policy recommendations, applicable to a broad range of threats and crises.

The Group of Chief Scientific Advisors (GCSA)

The GCSA contributes to the quality of EU legislation through the provision of independent scientific advice to the European Commission. The Advisors are seven eminent scientists, appointed in their personal capacities and who advise the Members of the European Commission on issues of public interest. The Advisors work closely with the Scientific Advice for Policy by European Academies (SAPEA) consortium. A summary of the Advisors’ previous publications and their impact can be found in their February 2020 report, ‘Informing European Commission Policy Making with Scientific Evidence’. https://ec.europa.eu/research/sam

SAPEA (Science Advice for Policy by European Academies)

SAPEA is a consortium of academy networks. Across these networks, it brings together outstanding expertise from natural sciences, engineering, and technology, medical, health, agricultural and social sciences, and the humanities. SAPEA draws on over a hundred academies, young academies and learned societies in more than 40 countries across Europe. www.sapea.info/crisis/

The European Group on Ethics in Science and New Technologies (EGE)

The EGE is the independent, multi-disciplinary body appointed by the President of the European Commission, which advises on all aspects of Commission policies and legislation where ethical, societal and fundamental rights dimensions intersect with the development of science and new technologies. It was initially established in 1991 by President Jacques Delors. It reports to the President, and to the College of Commissioners as a whole, under the direct responsibility of the Commissioner for Innovation, Research, Culture, Education and Youth. In recent years, the group provided advice on topics such as artificial intelligence (2018), the future of work (2018), COVID-19 and health crises (2020, three deliveries), genome editing (March 2021), and on Ukraine and in support of peace (March 2022).

More information

Crises become the Norm, not the Exception. Shutterstock/ Wirestock Creators

Systemic Risks The European Union faces a growing number of complex, overlapping, transboundary crises, such as the COVID-19 pandemic, climate change, and Russia's invasion of Ukraine. It must better prepare for and respond to them, according to the scientific and ethical opinion delivered to the EU Commission at the European Parliament in Strasbourg on Nov. 22, 2022. Leuchtturm im Unwetter engl

The European Union faces a growing number of complex, overlapping, transboundary crises, such as the COVID-19 pandemic, climate change, and Russia's invasion of Ukraine. It must better prepare for and respond to them, according to the scientific and ethical opinion delivered to the EU Commission at the European Parliament in Strasbourg on Nov. 22, 2022.

Systemic Risks Systemic Risks Global Implications of Socio-Technical Change Systemic Risks 0

Systemische Risiken: Grundlagen und Fallstudien

bsc — Wed, 19 Oct 2022 08:50:39 +0000

Systemic Risk: Theoretical Foundations and Case Studies Felix Beger Sun, 10/30/2022 - 20:31

Felix Beger

Special Issue

pjs

bsc

Systemic risks have the potential to trigger far-reaching changes in a given system, and may induce runaway effects. To be sure, enormous consequences may result from a failure to adequately recognise the determinant features of complex global systems – or to manage attendant problems. In many cases, there is an abundance of existing empirical research on systemic risks such as climate change. However, there is still a lack of knowledge concerning how to implement this knowledge in decision-making processes and associated policy formation. In this way, effective governance strategies to address systemic risks are sorely needed.

Theoretical foundations and case studies

The special edition is divided into two parts. The first part is devoted to the characteristics of systemic risk, including their conceptual definition and practical application. It also includes an interdisciplinary contribution to our theoretical understanding of systemic risk that incorporates perspectives from physics, engineering, biology, human ecology and the social sciences.

The second part presents various case studies, considering diverse topics such as financial markets and socioeconomic inequality. Another article discusses geoengineering from the perspective of the sociology of science. As the risks posed by geoengineering are difficult to assess and remain highly controversial in relevant academic circles, the systemic nature of the risk predominantly stems from the discourse surrounding climate engineering, rather than its actual implementation, the authors argue.

The primary insight offered by this special issue is that systemic risks share key characteristics, and that these characteristics can guide processes related to risk assessment, characterisation and governance. The authors hope this special issue will promote discourse on systemic risk, encouraging a more comprehensive and detailed engagement with the topic.

Systemic Risks from Different Perspectives: Ortwin Renn, Manfred Laubichler, Klaus Lucas, Wolfgang Kröger, Jochen Schanze, Roland W. Scholz, Pia-Johanna Schweizer
Systemic Risk: The threat to societal diversity and coherence: Ortwin Renn, Klaus Lucas
Theory of Systemic Risks: Insights from Physics and Chemistry: Klaus Lucas
A Proposal for Integrating Theories of Complexity for Better Understanding Global Systemic Risks: Armin Haas, Manfred Laubichler, Joffa Applegate, Gesine Steudle, Carlo C. Jaeger
Volatility as a Transmitter of Systemic Risk: Is there a Structural Risk in Finance? Harald A. Mieg
A precautionary assessment of systemic projections and promises from sunlight reflection and carbon removal modelling: Sean Low, Matthias Honegger

Risk Analysis, Volume 42, Issue 9, Pages: 1893-2124, September 2022

Hochwasser in Belgien im Sommer 2021: Durch den Klimawandel werden Extremwetter wie Starkregen immer häufiger. Shutterstock/Thierry Hebbelinck

Systemic risks such as climate change, cybercrime, pandemics and social inequality are complex and interconnected. Accordingly, managing such risks requires effective organisational structures and processes. A new special issue of the journal Risk Analysis presents theoretically robust, evidence-based approaches for assessing and managing risk. The special issue is edited by IASS Director Ortwin Renn and Research Group Head Pia-Johanna Schweizer. Hochwasser Belgien

Systemic Risks Systemic Risks Global Implications of Socio-Technical Change Systemic Risks 0

Soziale Kipppunkte im Fokus

slz — Thu, 13 Oct 2022 15:34:36 +0000

Social Tipping Points in the Spotlight dha Tue, 10/18/2022 - 14:53

Damian Harrison

Study

pjs

slz

Social tipping points are moments in dynamic systems where a small change triggers an abrupt, irreversible change in a social system. This can result in both negative and positive outcomes. However, a social system changes differently than natural structures where universal rules and laws come into play. This is because people make decisions that are susceptible to behavioural biases. In doing so, they are shaped by cultural contexts that change with new information and social influences and are multifaceted. Previous research on social tipping points has focused mainly on climate change mitigation or the physical dimensions of climate-related shocks. Incorporating social complexity into models is no trivial undertaking, the team explain. For example, Earth System and Integrated Assessment Models (ESM and IAM) are critical to understanding the coupled dynamics of climate and socioeconomic systems at the macro level, but even they do not account for human behaviour at the micro level, they argue.

Case studies from recent history

The authors reviewed social tipping moments using two case studies from recent history: the Arab Spring and Tamil Nadu, India. System dynamics and agent-based models are best suited for this purpose, they concluded, because they model cross-scale feedbacks and interactions as well as integrate thresholds and nonlinear processes. Other approaches to modelling complex systems that consider cascading effects, such as dynamic networks, are also well suited for analysing systemic risk, the researchers explain. On the other hand, issues related to modelling human action, such as uncertainties in determining degrees of freedom and agency in dynamic networks, are insufficiently addressed in these approaches, limiting their applicability.

The team also examined Agent-based models (ABMs) and concluded that these are specifically designed to capture macro-scale phenomena in non-linear systems emerging from social interactions among many heterogeneous adaptive and boundedly-rational learning agents. ABMs could identify self-reinforcing chain reactions that could increase conflicting and antisocial behaviour triggering systemic risks. They can also be used to trace the effects of seemingly insignificant events that trigger larger qualitative changes in social systems. Moreover, ABMs go beyond modeling the behavior of individual actors to capture changes in social institutions in response to climate-driven hazards.

The need for transdisciplinary approaches

At the end of their study, the authors provide three points with which to address social tipping point risk: first, risk governance should be based on an in-depth analysis of feedback mechanisms and cascading effects between systems and subsystems. This can be done using formal models of complex systems that reveal structural interdependencies and system dynamics and their influence on human actions.

Second, risk governance must be able to respond adaptively to rapidly changing societal contexts and demands. This requires that governance be able to adapt and anticipate early warnings of a tipping cascade and take into account institutional settings, regulatory systems, networks, and societal perceptions of risk. Early warning systems can facilitate the engagement of stakeholders and the affected public even before an adaptation threshold is crossed.

Third, transdisciplinary stakeholder-inclusive approaches are needed to facilitate governance arrangements that are problem-oriented and responsive to societal needs.

Publication:

Sirkku Juhola1, Tatiana Filatova, Stefan Hochrainer-Stigler, Reinhard Mechler, Jürgen Scheffran and Pia-Johanna Schweizer: Social tipping points and adaptation limits in the context of systemic risk: Concepts, models and governance, Front. Clim., September 2022, Sec. Climate Risk Management. https://doi.org/10.3389/fclim.2022.1009234

Social tipping points are moments in which a small change triggers an abrupt, irreversible change in a social system. Shutterstock/ emerald media

Systemic Risks While the physical tipping points of the climate system have been the focus of substantial research, social tipping points, in which societies succeed or fail in adapting to climatic change, have received little coverage. An international team including researcher Pia-Johanna Schweizer from the Institute for Advanced Sustainability Studies (IASS) recently published a study that explores social tipping points in connection with climate adaptation and systemic risks. 2210_Kipppunkte

While the physical tipping points of the climate system have been the focus of substantial research, social tipping points, in which societies succeed or fail in adapting to climatic change, have received little coverage. An international team including researcher Pia-Johanna Schweizer from the Institute for Advanced Sustainability Studies (IASS) recently published a study that explores social tipping points in connection with climate adaptation and systemic risks.

Systemic Risks Systemic Risks Global Implications of Socio-Technical Change Systemic Risks 0

Global Implications of Socio-Technical Change

Klimawandel und Unsicherheit: Wie geht die Gesellschaft damit um?

Early public consultation a must

Weighing the anticipated consequences of solutions

Industrie 4.0: Weder positiver noch negativer Einfluss auf Energieverbrauch

Is there a significant link between industry 4.0 and energy consumption?

Digital rebound and growth versus efficiency effects

Conclusion

Summary and recommendations

Publication:

Some Move with Speed and Grace, Others Slide and Goo…

To what, exactly, are we referring, you may ask?

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Digitalisierte Branchen nicht immer widerstandsfähiger als nicht digitalisierte

Recommendations for economic policy

Recommendations for companies

Publication:

Compliance, ESG, and Social Media in Brazil

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Nachhaltige Industrie durch digitale Lieferketten?

By Calvin Hanebeck (Uni Potsdam), Gereon Mewes (Minerva University) and Stefanie Kunkel (RIFS)

Background

Opportunities, risks, and obstacles of digitalisation for sustainable supply chain collaboration?

Conclusion on digital supply chains

A way forward? Recommendations for more sustainable digital supply chains

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Digitalisierung der Industrie: Ungleichheiten können nachhaltige Entwicklung gefährden

Smaller companies lagging behind

The automotive industry as a digitalisation frontrunner

Europa braucht mehr strategisches Krisenmanagement

Academies advise European Commission

The Scientific Advice Mechanism

The Group of Chief Scientific Advisors (GCSA)

SAPEA (Science Advice for Policy by European Academies)

The European Group on Ethics in Science and New Technologies (EGE)

Systemische Risiken: Grundlagen und Fallstudien

Theoretical foundations and case studies

Contents

Soziale Kipppunkte im Fokus

Case studies from recent history

The need for transdisciplinary approaches