Canada needs a new approach to assessing links between economic performance and environmental quality, according to an October 2 TD Economics report.
The term "green economy" lacks a standardized definition, the report argues, which makes it difficult to assess progress in that area. The term is defined using a narrow range of criteria, which results in some economic sectors being labeled as green while ignoring green initiatives being undertaken in sectors not traditionally thought of as being under the green economy label.
"Canadians should rethink the relationship between the environment and the economy," said TD Chief Economist Craig Alexander.
"Rather than viewing environmental progress and economic growth as being conflicting objectives, acknowledging the progress being made on both fronts can be empowering and creates promise that even more can be achieved."
The report recommends a balanced approach to evaluating the "greening" of the economy, which takes into account policy, corporate and consumer factors when working to minimize environmental impact while promoting economic growth, diversification and competition.
The report states that greening consists of a four-step process, which is:
- regulatory compliance;
- managing operational efficiency;
- making environmental improvements through the supply chain; and
- creating new products and services.
When assessing how industries are currently performing, the report states there has been some movement in the right direction.
"Environmental considerations have become heavily entrenched in corporate Canada's behaviour," Alexander said.
"Indeed, many businesses have recognized that more environmentally sustainable policies and practices are not just good for their brand and reputation, but can also lead to cost savings, new products, business models and new revenue opportunities."
According to the report, the extractive industry – in particular the mining and oil and gas sectors – is an example of that positive movement.
The mining sector, for instance, has launched numerous programs so mining companies can better manage their environmental operations. The Mining Association of Canada's Towards Sustainable Mining initiative, reads the report, is one such example. Towards Sustainable Mining requires mining companies to report on the energy use and greenhouse gas emissions of each facility in the company, among other requirements.
In the oil and gas sector, government incentives have been a driving force in environmental innovation, reads the report. In Alberta, the provincial government committed $1.3 billion to developing carbon capture and storage technology – advanced methods not yet used in British Columbia.
"What we're trying to say with this report is that the greening of the economy is about trends happening throughout the economy," said Karen Clarke-Whistler, chief environmental officer for TD Group.
"The extractives sector, for example, has regulations and incentives that ensure an acceptable level of greening. They are asking 'how do we reduce greenhouse gases in oil and gas' or 'how do we use less water in mining?'"
The Greening of the Canadian Economy can be found here.
