How businesses can bridge the gap between climate ambition and action, putting people at the heart of just transition in South Asia
Overview
The shift towards a low-carbon economy is reshaping the lives and livelihoods of people worldwide. However, top-level climate goals are often at odds with workers’ realities on the ground.
This report explores how businesses can turn climate intentions into concrete action that puts people at the heart of the shift to net zero. It uses examples of just transition in South Asia, as well as the challenges faced by buyers and investors in Europe when considering how to embed just transition principles in global supply chains.
This research is part of our work to improve understanding of the links between climate change and labour rights, in order to promote more responsible business practices.
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What does just transition mean?
The move away from fossil fuels risks deepening existing inequalities, as millions of workers depend on coal, oil and manufacturing.
Just transition means creating greener job opportunities without leaving people behind. It signifies not only mitigating the direct risks of climate change to people, but also addressing the impact on the workforce of potential unemployment, income loss, and exclusion from new opportunities.
Just transition in South Asia
Bringing together global frameworks and examples from companies in South and Southeast Asia, the report defines the concept and challenges of just transition for businesses, investors, policymakers and sustainability leaders.
Drawing on extensive research and interviews with business and civil society leaders - particularly in India and Bangladesh - the report features examples from companies of embedding just transition principles and turning them into action.
Just transition in context
garment jobs at risk in Bangladesh
Extreme heat and flooding could reduce Bangladesh’s garment industry's earnings by 22% by 2030, putting almost a million jobs at risk, according to Cornell University's Global Labor Institute and Schroders.
of coal workers in Jharkhand, India think they lack skills to work in other sectors
94% of coal workers in the state have not taken part in any training, and nearly half of those who have (45%) believe they lack the skills for alternative sectors, EY's 2023 Climate Trends report found.
people in Vietnam displaced by hydropower plants
Building small hydropower plants has displaced over 200,000 people in northwest Vietnam, 90% of them from ethnic minority groups, according to research by Ty Pham Huu and LANDAc.
Key findings
Context in South Asia
The report focuses on how just transition is understood and put into practice, with examples from India and Bangladesh.
In India, millions of workers employed in the coal industry will be affected by the shift away from fossil fuels. However, the report shows that the term ‘just transition’ is often perceived as an abstract concept, limiting conversations on how to ensure these workers can adapt and reskill to industry change.
Bangladesh is one of the countries most affected by climate risk, which will impact the country’s cotton production and garment industries, as well as displacing communities. Despite the impact on workers, there is a low level of awareness of the links between energy transitions and workers’ rights in the country.
Risks and gaps
Supply chains in the region power global industries. But top-level climate goals are often detached from the real-life impact of just transition on workers. Our research finds that progress on just transition in these regions is held back by:
- A lack of common understanding of what ‘just transition’ means across sectors and regions
- Limited alignment between businesses’ environmental and social strategies
- Data gaps due to few standardised reporting frameworks and insights on the social impact of climate adaptations
- Procurement practices that push the cost of just transition onto Global South suppliers
Competing priorities
Multinational buyers and local suppliers have different needs. Companies must balance competing drivers – such as such the cost of green investments versus the effect on wages, or the speed of change versus the need to include vulnerable workers.
Recommendations
Just transition efforts should be built on collaborative approaches that prioritise stakeholder engagement, rather than top-down climate directives. The report includes corporate case studies that highlight how companies can:
- adopt climate strategies that prioritise workers' and human rights
- set up cross-functional teams for accountability and action
- engage in on open dialogue with workers, suppliers and communities
- develop inclusive training programmes for workers
- improve data collection and standardise monitoring approaches, in order to measure the impact of just transition efforts.
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