Climate transition as national and regional development pivot has never won greater shared priorities in the society and the economy than at today’s crisis crossroads as demonstrated by leadership of the European Green Deal. Substantive lynchpin led by consequential reduction of the Greenhouse Gas Emission (GHG) in this sense is not just a technical requirement that meets collective ambition, forged by multilateral agreement on the premise of exacerbating global environmental concern. Structural reform on the whole-of-economy basis that seeks to lead climate-neutrality narrative also signifies leadership commitment with jurisprudence on the premise of policy and regulation (gravity of European Climate Law), together with orchestrated governance platform with substantial budget earmarked to the European Green Deal (30% of EU 2021-27 budget). But cross-sectoral and cross-regional impact is also indispensable, as witnessed by the introduction of ecosystem policy, notably in advancing structural growth of the demand and supply dynamics to the new efficiency frontiers (incentive to the integrated charging infrastructure as renewable share rises in the energy mix). Success of development transformation therefore depends on governance pivot that harnesses market, policy and regulatory decision toward achievable sustainable end.

1. World Bank’s Quality Infrastructure for Green, Inclusive and Resilient Recovery
Bangkok, Thailand / Page 1 (3) Edition: February 8, 2022
Sustainability Transformation of the European Green Deal:
Perspective of Structural Reform Governance
Siripong Treetasanatavorn
Sloan Fellow, Massachusetts Institute of Technology
Climate transition as national and regional development pivot has never won greater
shared priorities in the society and the economy than at today’s crisis crossroads as
demonstrated by leadership of the European Green Deal.1
Substantive lynchpin led
by consequential reduction of the Greenhouse Gas Emission (GHG) in this sense is
not just a technical requirement that meets collective ambition, forged by multilateral
agreement on the premise of exacerbating global environmental concern.2
Structural
reform on the whole-of-economy basis that seeks to lead climate-neutrality narrative3
also signifies leadership commitment with jurisprudence on the premise of policy and
regulation (gravity of European Climate Law), together with orchestrated governance
platform with substantial budget earmarked to the European Green Deal (30% of EU
2021-27 budget). But cross-sectoral and cross-regional impact is also indispensable,
as witnessed by the introduction of ecosystem policy, notably in advancing structural
growth of the demand and supply dynamics to the new efficiency frontiers (incentive
to the integrated charging infrastructure as renewable share rises in the energy mix).
Success of development transformation therefore depends on governance pivot that
harnesses market, policy and regulatory decision toward achievable sustainable end.
Narrative of smart sustainable infrastructure is a key pivotal governance mechanism
that makes greater sense of the structural reform on an achievable highground at the
required transition, essentially in resonance with broad-based socio-economic goals.
Stronger mix of the renewable sources not just advances the supply-side economics
with greater scale and scope that in turn brings incentive to electricity grid investment
especially in coupling with digital infrastructure and implications of smart governance
toward virtuous cycle of efficient resource allocation in the value chain (economics of
the Infrastructure 4.04
). But transformation of green infrastructure also takes place on
the demand side as information asymmetry is engaged and overcome, thereby giving
rise to stronger demand-side growth, and potentially in achievement of resilience and
inclusivity on the whole-of-ecosystem level (G20’s principles with economic resilience
and social/environmental consideration5
). Complementary measures with sustainable
impact are also addressed from governance perspective, considering potential of the
Social Climate Fund toward a just transition that takes account of social, employment
and educational agenda, such that all shall join this highground with none left behind.
Achievement of climate ambition toward temperature rise of 1.5-2.0°C in the long run
however requires much greater collective effort, particularly with rigorous governance
of the transitional pathway, substantiated by effective and mutually reinforcing choice
of strategy and operation with stakeholders and partners. First, prioritize at structural
agenda conducive to strategic capabilities substantive to critical factor conditions. By
nature of the reform agenda, climate transition requires strategic planning that makes
sense of system impact, considering hysteresis of underlying causes and causalities.
Scenario planning is therefore key,6
especially in identification of strategic milestones
and sense-making priorities of must-win engagements, given strategic tradeoffs upon
choices of transitional pathways (e.g., cross-continental emission trade with a whole-
of-economy approach, or focus on climate finance in strategic growth sectors), on the
premise of institutional capacities and market readiness as key prerequisites. Shared
confidence with stakeholders and partners is indispensable regardless of the political
challenge at hand, notably in dialog of effective governance along complex transition.

2. S. Treetasanatavorn. Sustainability Transformation of the European Green Deal
Edition: February 8, 2022 Bangkok, Thailand / Page 2 (3)

3. S. Treetasanatavorn. Sustainability Transformation of the European Green Deal
Bangkok, Thailand: Page 3 (3) Edition: February 8, 2022
Second, lead choices of the climate transition with accountable contribution from the
economy and the society. Effective governance decision that charts forward pathway
that matters in the whole-of-society context, must offer constructive participation to all
with market and policy incentive on the premise of rational choices. Value co-creation
and resonance is a prerequisite, notably in advancing achievement at key milestones
with respect to the masterplan (stronger transparency and accountability according to
substantive contribution from each sector in achievement of climate ambition at 55%
GHG reduction by 2030). But such approach makes sense once reinforcing changes
on the ecosystem level, particularly in greater shared narrative of the transition, such
as social or tax benefit as the transition reaches the anticipated milestones (shares in
pension-fund benefit once renewable energy mix reaches national/regional targets at
each milestone). Third, make intuitive sense of climate mitigation and adaption in the
governance of system resilience. Climate action that advances agenda of the society
requires meaningful feedback loop beyond the election cycle. Such defines risks and
opportunities of sustainability transformation, notably by considering structural reform
impact that matters to competitive socio-economic resilience in a long run. Forward-
looking pathways toward stronger reciprocal macro-financial stability is one (concern
of the global structural resilience as voiced by Financial Stability Board7
). Resilience,
however, also implies call of multidimensional strategy on the highground marked by
sense of preparedness in integration of capabilities and technologies but also finance
governance in sum.8
As such, smart choices of climate transition shall require sense
of whole-of-society decision that wins ecosystem-driven conscience with all in a joint
narrative, thereby embracing sustainability as joint mission at today’s crisis transition.
References (in appearance order):
1. EU Commission (2021): https://ec.europa.eu/commission/presscorner/detail/en/IP_21_3541
2. COP26 (2021): https://ukcop26.org/cop26-presidency-outcomes-the-climate-pact/
3. UNFCCC (2020, EU’s Nationally Determined Contribution):
https://www4.unfccc.int/sites/ndcstaging/PublishedDocuments/Germany%20First/EU_NDC_Su
bmission_December%202020.pdf
4. WEF (2021, Infrastructure 4.0): https://www.weforum.org/whitepapers/infrastructure-4-0-
achieving-better-outcomes-with-technology-and-systems-thinking
5. G20 Osaka Summit (2019):
https://www.mof.go.jp/english/policy/international_policy/convention/g20/annex6_1.pdf
6. IEA (2021): https://www.iea.org/reports/world-energy-outlook-2021
7. FSB (2021): https://www.fsb.org/2021/07/fsb-roadmap-for-addressing-climate-related-financial-
risks/
8. McKinsey & Company (2021): https://www.mckinsey.com/business-functions/risk-and-
resilience/our-insights/the-resilience-imperative-succeeding-in-uncertain-times