Governing industry decarbonisation: Policy implications from a firm perspective

Abstract

Industry is responsible for around 1/3 of annual global greenhouse gas emissions. To limit global warming, many nations, including Switzerland, have committed to a (near) net-zero emission industry target by 2050. While the policy relevance of an industry transition increases, specific knowledge on the key barriers and drivers towards industrial decarbonisation is still largely missing. With the objective to contribute to the decision basis for effective policy development and based on 17 semi-structured interviews with firms from the Swiss industry, we investigate the key factors that hinder or accelerate a timely adoption of decarbonisation technologies. We relate the identified barriers and drivers from our interviews to an adapted St. Gallen Management Model (SGMM), a well-known, system-oriented management framework. Our study shows that the SGMM categories technology & economy (e.g. high technology costs), state & policymakers (e.g. emission price) and finance & controlling (e.g. pay-back periods) are most frequently mentioned by the interviewees and that the firms’ decarbonisation decisions are influenced by both the firm itself as well as external stakeholders, such as the government, consultants, customers, NGOs or suppliers. Therefore, we conclude that the firm itself and each of these stakeholders must play a key part in fostering industry decarbonisation. We suggest future research to (1) quantitatively assess the importance of the identified barriers and drivers and (2) investigate how policy actions of the relevant stakeholders could be effectively orchestrated and incentivised.