With the rising social, economic, and humanitarian consequences of extreme weather events such as floods and heatwaves, countries need to double down on the pace of the green transition. However, justice and equity considerations of climate action are surfacing, and the current policy and business toolkit is inadequate to forge an equitable transition, eroding public acceptance and policy stability.

This paper, developed in collaboration with Boston Consulting Group, proposes an architecture of metrics to understand the incidence and severity of multi-dimensional equity implications of the greening of emissions-intensive sectors. Countries are grouped into six country archetypes based on shared structural contexts that can influence the emergence of equity challenges and opportunities in countries. Each archetype has its own opportunities and challenges for ensuring an equitable transition. The paper applies the metrics architecture to a representative country in each archetype, combining a view on structural opportunities with country and sector-specific metrics that highlight distributional risks within these countries.

Combined, these metrics support stakeholders in assessing the relative degree of exposure of workers, consumers, and small business to equity risks that different climate mitigation actions can intensify. Evidence-backed strategies, with policy-relevant metrics at the intersection of climate action and socioeconomic inequities can provide a sufficient baseline on risk, generate informed strategies, and ensure climate action serves both people and planet.

Report by the World Economic Forum