Interview with professor Edoardo Croci from Bocconi university

Interview with professor Edoardo Croci from Bocconi university

Soft&Green asked Professor Edoardo Croci, professor and coordinator of the Green Economy Observatory at the Bocconi University’s GREEN Center, to reflect on the energy transition.

The ecological transition is fundamental for our country and will also require a major commitment from businesses. Changing the energy system and reducing the environmental impact will require radical changes that will certainly come at a price. What is your opinion on this?

Businesses are a key player in the ecological transition. On the one hand, they find themselves in a situation in which increasingly incisive policies and regulations raise the bar of performance. On the other hand, they must respond to customers who are increasingly sensitive to environmental issues – not only final consumers, but also other companies in need of increasingly higher environmental requirements. Businesses are at the heart of this process of change and can see the ecological transition as an opportunity in terms of saving money and opening up new markets. Raw materials and energy often represent a significant cost item in companies’ budgets: for this reason, the ecological transition is also an opportunity to promote efficiency and innovation.

Within this scenario, what is the role of large companies in engaging SMEs?

Large companies play an important role because, when they set quality, product and performance standards, they go beyond their own boundaries to involve the entire supply chain and product life cycle. They have the opportunity, both upstream and downstream, to affect the behavior of other players along the entire value chain. In this transition, large companies therefore play a role that we could define as a driving force for the entire system.

The change taking place is widespread and, in the case of Italy, the stimulus coming from Europe is decisive. The latest approved European package “Fit for 55” concretely defines how to reduce greenhouse gas emissions by 55% by 2030. It is an endeavor that involves different sectors, different time scales and different actors. The environmental issue is no longer seen as separate from other sector policies and strategies but as integrated with them, touching all levels of governance and policy, company size, and individual behavior.

As is well known, a significant share of resources is earmarked for ecological transition in the RRP: what are the most significant areas of intervention?

The ecological transition requires major investments and the environment and climate dimension is the key axis for boosting competitiveness. Businesses must consider environmental measures as a medium- to long-term investment, a structural commitment to innovation and not as an intervention to provide immediate and temporary responses. Europe has focused on transition as a distinctive element: the Next Generation EU and the subsequent approval of the various RRPs at national level generate investments with a leverage effect on other public and private resources, and demonstrate the European commitment to get out of this crisis using the green recovery, i.e. the ecological transformation of our economy. This is a very precise choice that will affect all businesses and will be implemented in a few years: the RRP funds focus on the next 5 years. In the Italian RRP, 38% of the funds are related to climate and environment, especially when it comes to the efficiency of buildings, sustainable mobility and the circular economy. Some major projects have already been identified, while other resources are included in macro chapters that will translate into opportunities for businesses in the coming years.

Thinking about young people, which professions will be in highest demand in the labor market in the very near future?

The labor market will increasingly demand experts who integrate environmental issues into other professions. Up to now, we considered those dealing with the environment as internal consultants working separately from the other functions, whom the top management turned to for guidance on environmental strategies. Now, however, environmental expertise is being integrated into all functions. We see this also in the university world where environmental issues increasingly are integrated with other disciplines. There is a particularly high demand for environmental skills in some sectors, such as energy efficiency in buildings, sustainable mobility, renewables and the circular economy. These are the sectors with the greatest impact on the environment: suffice it to say that buildings and mobility are responsible for 70% of climate-altering emissions in Europe. Finance should not be forgotten: we talk about green finance and its ability to influence the choices and behaviors of companies increasingly often.

What role can education, particularly at university, play in this phase, which is seeing a great change in the very way of doing business?

In today’s university world, some topics, such as those concerning energy, public services and smart cities cannot be analyzed without a correlation with sustainability, which has become an interdisciplinary theme in the training of a manager, regardless of the role he or she will play in a company or public institution. The environment component is a key element in training. Collaborations between business and technical universities are also underway to integrate knowledge and skills: the logic of multi-disciplinarity in addressing sustainable development issues is growing.

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