Public and Private Accountability in the Green Transition – A Paradox of Responsibilization?

Government plays crucial roles in addressing and acting on the green transition and grand societal challenges more broadly. One of these roles is to make private businesses responsible and accountable for sustainable development through public policy. But what about government’s ability to make itself and the public sector responsible and accountable for green actions and outcomes? Based on the case of Denmark, this blog post argues that the self-responsibililization of government and the public sector calls for closer scrutiny as it tends to be characterized by decoupling and lack of clearly defined ownership and accountability regarding the green transition.

Government is widely considered to be a main driver of the green transition. The huge regulatory apparatus currently rolled out within the EU in support of sustainable development is a vivid example of this. The EU Taxonomy and other regulatory initiatives under acronyms such as CSRD, ESRS, TCFD and SFDR are reflective of responsibilization of the private sector on an unprecedented scale, making businesses and investors alike subject to extraordinary demands regarding their ESG disclosures and transparency.

The overall aim is to build an information infrastructure that can facilitate and support the green transitioning of business and the effective channeling of investor capital into economic activity supporting the green transition.

But what about government itself? To what extent is government taking its own medicine and formalizing its own commitment to the green agenda? Beyond lofty and often ambitious policy commitments and specialized departments, how effective and consequential is the internal self-responsibilization of government and the public sector? Unfortunately, the short answer seems to be: not very effective and consequential at all. The Danish case can serve as a vivid illustration of this conundrum.

Denmark is known for having the most ambitious climate law in the world, aiming to reduce GHG emission by 30 % in 2030 and to reach climate neutrality in 2050 at the latest. Denmark is the top-ranking country in the Climate Change Performance Index and is widely known as a global frontrunner in the green transition. How is this high level of government commitment then reflected in the internal organization and coordination of green initiatives?

Key roles are played by two specialized ministries that are mandated to drive the green agenda: the Danish Ministry for Climate, Energy and Utilities in particular, and the Ministry of Environment of Denmark, which houses the Environmental Protection Agency. However, beyond these specialized administrations and the Ministry of Industry, Business and Financial Affairs, with its focus on supporting sustainable development in the private sector, you search in vain for more elaborate integration of the green agenda into central government bureaucracies.

Green transition must necessarily involve fundamental transformations of society. Facing enormous complexity and multiple wicked problems, it calls for systemic solutions, cross-sector collaboration and willingness and ability to venture beyond silos and silo mentality. Therefore, it is problematic that the green transition does not seem to be integrated into the agenda of, particularly, the all-powerful Ministry of Finance, or other central ministries such as the Ministry of Economic Affairs and the Ministry of Interior and Health.

These ministries, for better or worse, continue to operate according to a bureaucratic division of labor and a market logic that often renders green issues immaterial or reduces them to economic costs (that need to be weighed against economic benefits). The key objectives (kerneopgaver) of ministries and their agencies have not been adapted to reflect the urgency of the climate crisis and green concerns.

This means that the lofty climate ambitions of Danish government are effectively decoupled from administrative practices in large parts of the central administration, where public officials have little to work with and build on if they want to drive a green agenda. Green concerns are seen to belong somewhere else and be someone else’s problem, relating to other mandates, budgets, and areas of expertise. This is not to say that nothing happens outside the confines of the specialized ministries, but merely that extant framework conditions provide little support or incentive for green action elsewhere – despite the lofty ambitions of the Climate Act. Ownership is not encouraged and there is no direct green accountability.

This is not surprising, considering the bureaucratic and siloed organization of central government in general and the historical legacy of this form of public organization. It would arguably be more surprising if Danish government had found an efficient way to integrate the green agenda (or any other cross-cutting agenda) into all administrative functions.

Thus, while government and other stakeholders are calling for private businesses to integrate the green agenda into their policies and practices, government itself fails to accomplish such an integration. This points to a broader conundrum that we may term the paradox of governmental self-responsibilization as it relates to the green transition and corporate sustainability more broadly.

Speaking to public managers from central and local government (municipalities and regions) we hear the same sort of story: that there is a perceived need for tools, models, frameworks and enabling rules and regulations to support green initiatives in the public sector. Whereas the private sector has plenty to work with (some would say too much), it is often more or less taken for granted that the public sector and its organizations are saddled with social responsibilities and able to act on the green agenda while serving the public interest.

We have heard this story before in relation to CSR. That is, public organizations adopting the “CSR” terminology to make their commitment to social issues more tangible and explicit. It seems like history is repeating itself here, in the sense that public organizations, somewhat paradoxically, and perhaps with some envy, are looking to the private sector (and to regulations of the private sector) for inspiration and ways to make their commitment and approaches to sustainability more focused, systematic, and strategic.

This is not to denigrate the manifold green activities that are carried out by for instance Danish municipalities – that are facing the consequences of climate change daily. But while municipalities are engaged in green activities such as climate adaptation and -mitigation and green procurement, there are also multiple instances of government bureaucracy and red tape acting as constraints on municipal ambitions regarding sustainability, for instance in the area of procurement.

This again points to the general problem of the lack of proper central governmental integration of the green agenda and the consequences it can have in terms of failure to properly support and help coordinate green activity at the level of local government. We may indeed speak of the ineffectiveness of the self-responsibilization of government and the public sector and of the wasted opportunities and resources it entails.

For various reasons Denmark continues to be at the top of international sustainability rankings. There are good and not so good reasons for this. Good reasons include our strong position in renewable energy and the developmental trend in our GHG emissions, while not so good reasons include the outsize credit we get for our espoused climate ambitions (as opposed to our actual environmental accomplishments) and the fact that the environmental effects of our burning of biomass and our consumption-related imports are often excluded from consideration – along with our no less than miserable performance in the area of biodiversity.

However, if we are to actually deserve the accolades and deliver on our promises it is necessary to consider how public sector contributions can be enabled and strengthened. It is not enough to focus on the effective responsibilization of the private sector. The self-responsibilization of government and the public sector calls for more attention and support of multi-level action, ownership, and accountability. There is certainly ample room for improvement.

In line with the Danish model of dialog, a starting point could be open and honest discussions about the strengths and weaknesses of the current setup and the risks, opportunities and bureaucratic and regulatory difficulties involved in a more full-blown and integrated commitment to the green agenda. This could yield an overview of what is lost with the current model and what could potentially be gained with a stronger and cross-cutting governmental commitment to the green agenda.

Suggestion for further reading:

• Vallentin, S. & Thygesen, N. (2017): Trust and Control in Public Sector Reform: Complementary and Beyond. Journal of Trust Research, 7(2), 150-169.