A N A LY S I S LABOUR AND SOCIAL JUSTICE JUST TRANSITION Remembering the UK workforce in the push for net zero Patrick Briône September 2021 The road to net zero carbon emissions poses risks for the workforce if not handled carefully. The concept of a just transition – where jobs and livelihoods are protected and workers are reskilled to find new green jobs – is gaining in importance across the UK and the world. To succeed, a just transition requires partnership between the workforce and employers, including a strong worker voice. This is both to allow workers to speak up to secure their interests but also to ensure buy-in for the vast changes required. Government also has a vital role to play, facilitating this dialogue at regional and sectoral level and providing strategic leadership. At present the UK government seems reluctant to embrace this leadership role.

LABOUR AND SOCIAL JUSTICE JUST TRANSITION Remembering the UK workforce in the push for net zero

Contents 1 THE ROAD TO NET ZERO   2 2 A JUST TRANSITION? STATE OF THE UK DEBATE   4 UK Government  4 Regional Governments  6 Employers  6 3 THE NEED FOR PARTNERSHIP   8 Net zero as change management  8 Partnership in action  9 The value of trade unions  10 Forums for dialogue  11 4 KEY LESSONS FOR THE UK   13 Just Transition Agreements at firm level  13 The need for more sectoral and regional dialogue  14 The missing national strategy  14 References  16 1

FRIEDRICH-EBERT-STIFTUNG – JUST TRANSITION 1 THE ROAD TO NET ZERO In a 2019 amendment to the Climate Change Act, the UK government made a legal commitment to reaching»net zero« greenhouse gas emissions by 2050 – the first major economy in the world to legislate for such a target. To meet this ambitious goal, however, will require huge changes across many aspects of life in the UK – in the way we live, travel and work. Some tasks, such as the decarbonisation of the energy grid, by shifting from coal, oil and gas to renewable energy sources, are relatively straightforward and the UK has already made major strides in this area. Overall UK carbon emissions have fallen 40 per cent from 1990 to 2019 – the biggest reduction in the G20. In many ways, however, what has been achieved to date has represented the easy bit – the lower hanging fruit of carbon reduction. The years ahead will require much more controversial, difficult and impactful changes – the shift to electric vehicles, the end of natural gas boilers in consumer homes, changes to our diets, and the decarbonisation of industry. In this latter area, the UK government has committed to reduce emissions in manufacturing and refining by two-thirds between 2018 and 2035, though the Climate Change Committee(CCC) estimates this will need to be more like 73 per cent(Climate Change Committee 2021). To achieve such decarbonisation, businesses across the economy will need to change the way in which they operate and change the way in which their people work. Some changes to workplaces might involve simple actions like switching to LED bulbs in the office or introducing a cycle to work scheme. Others will involve long term and potentially costly investments in things like electric vehicles, more efficient manufacturing equipment or better insulated buildings. For firms in certain sectors, it will involve the wholesale changing of industrial processes, changing entire product lines to reduce packaging or make more environmentally conscious products. While all sectors of the economy will be impacted to a greater or lesser extent, certain energy-intensive sectors are particularly likely to see major changes, such energy, housing, transport and certain heavy industries. According to the UK’s Industrial Decarbonisation Roadmap,»twothirds of industrial emissions come from eight energyBox 1 What is a»green job«? Definitions vary and the Office for National Statistics has published an article on the challenge of reaching an agreed-on definition. Some take a sectoral approach, while others look at whether the jobs directly contribute to reducing carbon emissions. One common definition from the UN defines the Environmental Goods and Services Sector(EGSS) as»areas of the economy engaged in producing goods and services for environmental protection purposes, as well as those engaged in conserving and maintaining natural resources«. Some definitions, including the International Labour Organisation(ILO)»green work«standard and the text of the Paris Climate Agreement, also include requirements that work be»decent«. intensive sectors: cement, ceramics, chemicals, food and drink, glass, iron and steel, oil refining, and pulp and paper. Between them, these sectors employ around two per cent of the UK’s workforce.« For some workers, this will change both the nature of their work but also the skills they will need in order to survive and thrive in the greener workplaces of the future. A specific category of employment is increasingly being referred to, that of ›green jobs‹(see Box 1) – posted prominently on job sites and seen as more desirable than regular jobs, carrying as it does connotations of both ethical virtue but also long-term job security in the face of the coming green revolution. While there is no readily used term to describe the opposite of green jobs(perhaps ›carbon-heavy jobs‹), it is clear that there are millions of workers today in the UK who currently find themselves working in roles contributing more to increasing carbon emissions than to reducing them. Understandably, workers in such roles may see the push to net zero as a threat to their livelihoods if it is not managed in a responsible and considerate way. The UK government has a declared ambition to create two million green jobs in the UK by 2030. The Green Jobs Taskforce, a body established in November 2020, including business leaders, skills experts and trade unionists, to advise the government on this agenda, estimated in its 2021 2

THE ROAD TO NET ZERO report that»one in five jobs in the UK will require skills which may experience demand growth or reduction in the transition«, split equally between 10 per cent growing and 10 per cent reducing. In some cases the transfer from the high to low carbon jobs can be managed in more or less the same role, perhaps with a level of retraining or upskilling. For instance in the automotive sector, the Faraday Institution estimates that 50,000 workers need retraining or upskilling by as soon as 2025 to adapt to the shift to manufacturing electric vehicles, as well as 160,000 further vehicle technicians who need to be trained and qualified to work with electric vehicles. This kind of training is something that can and should be provided by their existing employer, with government support. being created hundreds of miles away in London and parts of the south. We cannot afford to make the same mistakes again. While it is challenging to predict in advance exactly what skills will be needed in the future, there are certain broad conclusions that can be drawn. Generally, cross-cutting skills, in particular in Science, Technology, Engineering and Mathematics(STEM) will be needed, along with digital and data skills, plus the project management, change management, leadership and communications skills needed to deliver the major change programmes. It is incumbent on the UK government to ensure investment is occurring ahead of time to make sure those workers most affected by the transition to net zero have the skills and opportunities to find decent jobs in the green new world we are aiming for. In other cases, skills are directly transferable to new roles, if not in the same firm then at least in similar roles in adjacent industries. For example, the Green Jobs Taskforce report states that the growth of existing green sectors, such as offshore wind,»will require a broad range of skills, including asset management, project management, engineering and technical skills,(…) science,(…) advanced first aid and rescue, and offshore-specific skills(…). Many of these skill gaps could be covered by workers currently in the oil and gas sector, given the transferability of their skills to offshore wind.« Likewise, to quote from the landmark Just Transition Strategy published by Scotland-based energy firm SSE, which operates both wind farms and natural gas power stations, about their own workforce’s experiences;»There are directly transferable skills between the offshore oil and gas industry and the offshore renewables industry. For example, in the Beatrice offshore wind farm control room where two thirds of operators have been attracted from oil and gas.« In other cases, however, there will be jobs where no simple and obvious transfer of skills exists to an equivalent»green job« of equal quality. For instance, if reductions in flying leads to a loss of jobs in aviation, or if the decline of the oil industry leads to less shipping, those skilled in those transport roles may not have as much ease in directly transferring those skills to growing green sectors. This is particularly painful in some cases as the quality of traditional manufacturing and energy sector jobs often quite high, certainly compared with jobs in low paid service sectors or the growing gig economy. Part of the concept of a just transition will be ensuring that ›good‹ high-carbon jobs are not simply replaced with ›bad‹ green jobs. This will also require a focus on geography – the places where jobs are being created are not necessarily the same as those where jobs are likely to be lost. One of the painful lessons of the deindustrialisation of the 1970s and 80s in the UK is how local communities across many parts of Wales, Scotland and northern England were devastated by the closure of major local employers, even while many new jobs were 3

FRIEDRICH-EBERT-STIFTUNG – JUST TRANSITION 2 A JUST TRANSITION? STATE OF THE UK DEBATE In August 2021, UK Prime Minister Boris Johnson was widely criticised for joking comments about the closure of coal mines under Margaret Thatcher in the 1980s having »given the UK a big early start« on tackling carbon emissions(BBC 2021). While it is true that the phasing out of coal from the UK’s energy mix has made a positive contribution to reducing emissions, the closure of UK coal mines during the last decades of the 20 th century could be used as a textbook case of how not to manage a just transition to net zero. The changes were pushed through in the face of fierce opposition and outright hostility from workers and trade unions, and little was done to support workers’ transition to new jobs. The long-term damage to workers and their communities can still be felt today: according to data in 2020,»analysis of 53 ex-mining constituencies found that 30 had higher than average rates of child poverty, while 22 had higher than average rates of absolute child poverty«. The Prime Minister’s remarks in 2021 might well be seen as a sign that this lesson has yet to permeate the highest levels of government. What then is the UK’s current approach to this agenda – is the concept of a just transition being embedded in national policy making in 2021? Third sector bodies in the UK have certainly been busy in debating and publishing on the topic over the past couple of years. The Institute for Public Policy Research(IPPR) has put together an Environmental Justice Commission chaired by MPs Hilary Benn and Caroline Lucas to oversee research into a just transition. They have used citizens juries to explore public views in regions across the UK and produced sector specific guidance on transitioning the oil and gas sector workforce(Institute for Public Policy Research 2020), as well as their comprehensive Fairness and Opportunity report which calls for a »funded right to retrain« for all workers in high emissions industries(Environmental Justice Commission of the Institute for Public Policy Research(n. d.)). Meanwhile the centreright think-tank Onward has published their own Getting to Zero cross-party programme of research on managing the transition, chaired by two other MPs Caroline Flint and Caroline Spelman. Their report draws attention to the importance of geography in this issue, considering the rural areas and small towns where concentrations of workers are overwhelmingly reliant on high carbon industries (2021). The Campaign Against Climate Change meanwhile has been running for many years, organising grassroots activism, and involves a wide cross-section of mid-level trade union officials from a range of unions. Their work includes a comprehensive report into trade union engagement with the issue of climate change in the UK(2017). The role of trade unions in the transition to net zero will be considered in more detail in chapter three. Below we outline first the present state of the just transition debate with three other key groups – the UK government, regional governments across the UK and employers. UK GOVERNMENT While the UK is responsible for hosting the UN Climate Change Conference(COP26) in Glasgow this November, with former Business Secretary Alok Sharma now acting as its full-time chair, almost all of this group’s work has been focused outward, internationally. To understand the UK government’s own domestic approach, we need to begin by looking at their 2020 publication, the ›Ten Point Plan for a Green Industrial Revolution‹ which sets out the approach that the rest of the government’s approach is designed to revolve around. These 10 points cover major areas where the government believes emissions can be reduced, from »Advancing Offshore Wind« to»Greener Buildings« to »Green Finance and Innovation«. This document repeatedly signposts areas where new jobs could be created, but does not once mention the areas where jobs might be lost or where workers could require retraining or reskilling. The words ›workforce‹ and ›unions‹ only appear in the document once – in relation to the establishment of the Green Jobs Taskforce. The phrase ›just transition‹ does not appear at all. The Ten Point Plan is big on ambition but lacking in detail and in particular offers almost nothing when it comes to the question of just transition. One trade union leader described the government’s Ten Point Plan as»a shopping list – not an implementation plan«. The actual implementation plan – the much-awaited overarching net zero Strategy – is still not yet complete, with a number of plans still needing to be published ahead of COP26 in November. From what has been seen so far, however, there is little indication that there will be any more of a focus on the need to support and partner with the workforce than 4

A JUST TRANSITION? STATE OF THE UK DEBATE there was in the Ten Point Plan. Indeed, the winding up of the Industrial Strategy Council in early 2021 is a worrying sign of the government moving away from providing strategic leadership on industrial and labour market issues at all. In terms of public investment in hydrogen industries for example, the UK has committed only about a tenth of what the German government has committed, and an eighth of France. Without this kind of investment, jobs in these new green industries risk being created overseas rather than in the UK and workers in decarbonising industries will struggle to find employment elsewhere. Meanwhile, without this investment in reskilling and workforce engagement, there is a real risk that the workforce is not willing or able to deliver the huge changes in infrastructure and technology needed to handle the transition to net zero. While official government publications from the Department of Business, Energy and Industrial Strategy(BEIS), the department responsible for the transition of UK business to net zero, avoids any mention of the need for a just transition, the same is not true of other public bodies. The government’s activities on all aspects of the transition are overseen and scrutinised by the Climate Change Committee(CCC) – a statutory body, responsible for advising and monitoring UK’s progress towards net zero. This body is mostly led by academics and produces regular publications on pathways to decarbonisation. The CCC has been somewhat critical of the UK government’s approach over the last couple of years, saying in its latest report that(…). A patternhas emerged of Government strategies that are later than planned and, when they do emerge, short of the required policy ambition«(2021). In its 2021 report to parliament, the committee recommended all relevant departments collaborate to»develop a strategy for a net zero workforce that ensures a just transition for workers transitioning from high-carbon to low-carbon and climate-resilient jobs, integrates relevant skills into the UK’s education framework and actively monitors the risks and opportunities arising from the transition.« This is an unequivocal recommendation to incorporate just transition planning into the climate change strategy, though as one trade union leader commented for this report, while »the CCC have talked about just transition being important, it’s not at the heart of their challenge.« Even this limited recommendation, as yet unacted upon, falls long short of what certain other countries have been doing. The New Zealand government, for example, has established a permanent»Just Transitions Unit« within their own Ministry of Business, Innovation and Employment, to ensure their journey to net zero is»fair, equitable and inclusive,« through»creating partnerships in communities undergoing a major transition«(New Zealand – The Just Transitions Unit 2019). The one concrete action that the UK government has taken in relation to the transition from the UK workforce’s perspective was the establishment of the Green Jobs Taskforce in late 2020. This group convened representatives from businesses, trade unions and skills bodies to advise both BEIS and the Department for Education(DfE), to look specifically at the workforce skills needed to reach net zero, how to support the quality of green jobs and how to transition workers from high carbon sectors into the new green economy. The Green Jobs Taskforce Report, published in July 2021, looked in detail at all these issues and concluded with a clear set of recommendations, including that»The government should work with industry, unions and other key stakeholders to actively set out, as part of the net zero Strategy, how it will ensure that the green jobs created by employers are good quality as defined by the Good Work Plan, regardless of skills base.« This linking of the net zero agenda together with the Good Work agenda started by Matthew Taylor’s Review of Modern Employment Practices back in 2017 is vital if a just transition in the UK is to be realised, and the UK is to live up to its commitments under the Paris Agreement that countries must account for»the imperatives of a just transition of the workforce and the creation of decent work and quality jobs in accordance with nationally defined development priorities«(United Nations Framework Convention on Climate Change 2015). It is yet to be seen how many of the Green Jobs Taskforce recommendations will be acted upon. However, there are real concerns among many policymakers, academics and workforce representatives in the UK that the Good Work agenda is falling by the wayside as a result of changing government policy priorities. The surprise removal of Matthew Taylor himself as the Interim Director of Labour Market Enforcement in January 2021, with no successor lined up, was a worrying sign that the government was moving away from the Good Work agenda he had been instrumental in spearheading under former Prime Minister Theresa May. Taylor himself commented in a Tweet at the time that »it appears ministers would rather the Office had no leadership and was effectively unable to operate publicly than accept my offer to continue week to week(unpaid if necessary) until a successor is appointed – baffling.« Only a month or so later, the closing down of the Industrial Strategy Council headed by Bank of England Chief Economist (and Matthew Taylor’s successor as Chief Executive of the RSA) Andy Haldane, was a further sign that the interventionist labour market approach Theresa May had pushed was coming to an end. While BEIS still formally includes the »Industrial Strategy« moniker in its name, the phrase is no longer used in government communications and thought likely to soon be dropped. The Green Jobs Taskforce report aside, the government also no longer references its own Good Work Plan. Haldane himself wrote in the Financial Times the same month his council was disbanded that»In the UK, industrial strategy is dead«(2021). 5

FRIEDRICH-EBERT-STIFTUNG – JUST TRANSITION REGIONAL GOVERNMENTS EMPLOYERS While this bleak assessment might be true at a national level, there is a different story when it comes to the UK’s various devolved and regional governments. Here the Scottish Government is leading the way, having established a Just Transition Commission that brings key stakeholders to the table to develop joint strategies for the transition and set milestones to measure against. Crucially this includes representation from trade unions and environmental groups as well as academics and business leaders. Their interim report, published in 2020, is up-front about the risks of job losses in some areas and the need for proactive leadership and engagement to ensure workers are retrained or reskilled to allow them to transition safely to new green jobs, adding that: »We believe clear transition plans need to be developed for individual sectors if Scotland is to capture the economic and social opportunities on offer from the move to a net-zero economy(…) We believe such plans would be most effective if they are jointly developed and owned by a range of stakeholders.« Some of England’s city regions have also been actively developing their own transition strategies, building on the Local Enterprise Partnerships(LEPs) or other forums for stakeholder engagement that exist at these levels. Greater Manchester’s Mayor, Andy Burnham, has announced a commitment to reach net zero for the city region by 2038, 12 years ahead of the national government target. The Liverpool City Region, led by Metro Mayor Steve Rotheram, is seen as a particular leader in this area, having declared a climate emergency in 2019, signed up to the TUC Apprenticeship Charter and having worked through their LEP to engage employers across the region. Plans are currently underway to construct a massive tidal project to harness the power of the river Mersey and»Unions are optimistic that, if based at the combined authority, such a project could lead to good, unionised jobs«(TUC 2020). In the meantime, the region is conducting a widespread listening and consultation exercise to gain public and workforce input into their Liverpool City Region net zero Action Plan, to help the region achieve net zero carbon by 2040. Despite these efforts at regional levels, however, which have generally been praised by trade unions and local businesses, the problem remains that most of England, outside of a few city regions, is not covered by regional government bodies of this nature. For industries operating in smaller towns and cities across the UK, this kind of locally targeted strategic planning from government is much harder to come by. Smaller local authorities across the four nations of the UK have mostly set their own net zero targets – including ambitious 2024 targets in some cases of rural areas with significant renewables generation – but these local authorities often struggle to act as forums that can coordinate employer, trade union and other stakeholder behaviour in a strategic way. If governmental planning around just transition is seen to be lacking, what about UK employers’ own approaches to the topic? According to UK academics Dr Abigail Martin and Dr Max Lacey-Barnacle,»there seems to be no central government leadership for a Just Transition strategy that engages the public, businesses, cities and local authorities. Absent legislative or institutional commitments on a Just Transition, many groups across the UK are left without adequate representation, leadership and coordination in managing the shift away from fossil fuels. In this vacuum, businesses and unions are self-organizing«(2021). So how developed are UK firms’ plans for decarbonization? At a sectoral level, a number of reports have been published outlining pathways for that industry over the coming years, such as the North Sea Transition Deal, agreed between the UK government and the oil and gas sector, represented by sector body Oil and Gas UK(OGUK). This includes emission reduction targets for 2030 and explores how jobs in the sector could be protected and other workers’ skills transferred to the carbon capture and hydrogen sectors(Department for Business, Energy& Industrial Strategy 2021). Workforce representatives, however, were not primarily involved in the negotiations over this agreement. Other sectors such as the Chemicals Industry Association have published similar planning documents on the transition to net zero, including mention of the need for»Government and business to work together to achieve a just transition« and discussion of steps needed to achieve this (2020). Five leading business groups – CBI, Make UK, Institute of Directors, the Federation of Small Businesses and the British Chamber of Commerce – banded together in November 2020 to urge the government to adopt a joinedup just transition policy, including a»fairness test« against which to evaluate prospective climate policies(Holder 2020). The trade union Prospect has also called for a»Just Transition Council for the Power Sector« to deliver a net zero plan for the energy industry(2020). At the level of individual firms, however, there is a much more mixed picture. A few UK employers have seized this agenda and taken a very proactive approach to driving it forward. Foremost among these is often cited to be the energy firm SSE, which was the first UK firm(and among the first in the world) to publish a formal»Just Transition Plan«. This document, released in November 2020, covers the impact the transition from high to low carbon activities will have on all key stakeholder groups, and defines the 20 principles that will underpin that transition. The plan includes specific guarantees of fair pay, decent work and boosting diversity and inclusion for their workforce, as well as supporting the workforce of their supply chain(SSE 2020). The company also plans to report against the Just Transition Plan as part of its annual Sustainability Report. Commenting on the plan, SSE’s Chief Sustainability Officer, Rachel McEwen, said: 6

A JUST TRANSITION? STATE OF THE UK DEBATE »The rapid move towards net-zero brings a risk that some people are left behind – perhaps those without opportunity to reskill into the low-carbon industries or unable to access the benefits of the new energy system. We are clear that it is in everyone’s interests that fairness is baked into net-zero transition plans. We are equally clear that companies like SSE, have a role to play. With considered intervention through advocacy, partnership action and thoughtful policies and practice, SSE can help bring about positive social consequences and contribute to a just transition to net-zero«(Mace, 2020). Since the end of 2020, other UK utilities firms have been under increasing pressure to follow suit in laying out their own just transition plans, or risk a social backlash from investors, consumers, local communities and their workforces (Keating 2020). As Carlota Garcia-Manas, senior responsible investment analyst at Royal London Asset Management put it:»There are real risks of social backlash to the transition, which may deter it from happening or decelerate its pace(…) Energy companies need to address the social impact that the transition carries.« The chemicals firm Croda offers another example of how companies are responding to this issue. The company, a leader in sustainability in the chemicals industry, has undergone major changes over the past two decades to move towards more high-tech manufacturing and is seeing still more pressure to evolve its products and processes to reduce emissions going forward. Phil Ruxton, Chief Sustainability Officer, described how»we are gearing the workforce up for change« through a structured programme of employee engagement and consultation. He admits, however, that the firm is still at a relatively early stage in terms of seeing the impact of these changes on the workforce, and the fears more long-term that some of workers in the supply chain could become»stranded assets«. One difficulty he pointed to, shared by manufacturing firms, is that while the firm may be fairly far along in terms of reducing its own direct emissions,»a lot of our emissions are upstream of us«, coming from their reliance in this case on crop based raw materials such as palm oil that are linked to deforestation.»Thinking about social impact upstream is still at the early stages.« ment’s long-term target, but there is little thinking about what impact that will have in practice for their workers over the next 10 or 20 years. In truth, most major UK companies are still relatively early in their journey towards drawing up just transition plans of the kind published by SSE, while for smaller businesses the issue of climate change may not even register on their radar at all. In spring 2021 the UK government launched a campaign for small and medium businesses(with 250 employees or fewer) to sign the SME Climate Commitment to halve net emissions by 2030 and achieve net zero by 2050. As of August 2021, around 1,600 SMEs have signed this pledge, though they are provided only fairly broad guidance in what actions they might need to take and nothing in the way of guidance on involving their workforce, at what are likely to be non-unionized firms lacking in formal consultation structures. Anna Markova from the TUC comments that»we increasingly see businesses making commitment to net zero by 2050 but without any understanding of how to do that in a way that protects their workforce(…) we want to see the trade union movement take the lead there.« This is not helped by the COVID-19 pandemic, which has led many UK firms to adopt a relentless focus on survival rather than long term planning over the past two years. As a result of the pandemic, many large employers are consolidating and reducing their estate strategy, to adapt to the increase in remote working – this may well have knock on benefits in terms of carbon reduction, but there is little to suggest the environmental benefits are a major driver of these decisions. This question of the future of remote working is also another example of an area where some employers are demonstrating the virtues of close partnership with their workforce, while others are attempting to push through these decisions without consultation. As will be seen in the following chapter, the way companies approach the question of partnership with the workforce can have a huge impact on the success or failure of these change programmes. Despite examples like these of firms thinking in a strategic way about their long-term journeys to net zero and the impact this will have on their workforces, on the whole firm-level leadership when it comes to detailed planning or grasping the scale of the strategic challenge is still lacking in the UK. Environmental, social and corporate governance, or ESG, reporting statements are now expected in annual reports, and some firms include reference to their workforce as part of these, alongside environmental commitments. A minority of firms also have workforce representatives who sit on environmental committees that are determining policy in this area. Many firms have signed up to commitments to reduce their emissions by 2050 in line with the govern7

FRIEDRICH-EBERT-STIFTUNG – JUST TRANSITION 3 THE NEED FOR PARTNERSHIP What is missing from too much of the debate around the transition to net zero is the views and perspective of the workforce themselves. An issue of this scale, and with such vast ramifications for all parts of our society, cannot be dealt with simply through the imposition of top-down plans, be they drawn up by employers or governments. It needs to be approached in a spirit of partnership, through which all affected stakeholders have their voices heard. When it comes to the transformation of our workplaces, that means the voice of the workforce. As the report of the Green Jobs Taskforce puts it:»the UK must manage the transition to net zero in an inclusive way, so that those affected workers have a voice in shaping the transformation.« There are two equally important reasons why it is so vital to involve worker voice in key decisions around the journey to net zero. First – because a just transition, rather than simply an efficient one, will need workers to exert their power and influence to ensure that their interests are fairly protected. Secondly – because to achieve any kind of transition to net zero at all requires change management on a massive scale; something that it almost impossible to achieve without the buy-in from the workforce that comes from effective engagement.  a sense of urgency within the organisation that change is needed, by identifying threats and opportunities and starting conversations  the guiding coalition of key people from different areas and levels within the organisation who will lead the change  a vision and strategy about why the change is happening, what values underpin it and how it is going to be executed  the change vision clearly and repeatedly to employees, taking care to address anxieties as well as leading by example  employees by removing obstacles, changing structures, providing help to those resisting and rewards to those making it happen  short-term wins that staff can see, focusing on easy and achievable targets in order to motivate and encourage staff through success  gains by analysing what goes well and badly at each stage and setting goals to continue building on momentum achieved so far NET ZERO AS CHANGE MANAGEMENT Whether it is about changing automotive production lines from traditional petrol cars to electric vehicles, changing working patterns in an office to reduce commuting, or completely reskilling the workforce of a major energy firm to turn oil rig workers into wind turbine workers, the corporate journey to net zero is all about change and change management. The importance of workforce engagement as a pillar of change management is well established. One of the most influential books on change management in recent decades,»Leading Change« written by Harvard Professor John Kotter in 1995, outlines an eight-step change process which organisations must navigate:  changes in corporate culture in order to make sure that they stick, publicising every success and including change values in training for new staff All eight of these steps are made easier and more achievable by a proper degree of workforce partnership and engagement. In particular step two»creating the guiding coalition« explicitly calls for building partnerships across the organisation, while point four»communicating the change vision« is entirely about proper engagement and two-way dialogue – explaining to the workforce while also listening to their concerns. To be able to do this properly at a firm level requires some level of collective workforce voice or representation, either though trade unions or though effective staff forums or other representative bodies. In the absence of proper workforce partnership, employers are likely to fail on at least one of the steps. Without buy-in 8

THE NEED FOR PARTNERSHIP from the workforce and reassurance that their anxieties are being addressed, workers are understandably likely to see major changes as a threat to their jobs and ways of working. Without a shared sense of urgency from top to bottom of an organisation, ambitious targets for carbon reduction are unlikely to be met. Without a proper feedback loop of employee voice, managers at the top are likely to get a false sense of how well the change is going, failing to spot unexpected problems arising in time for them to be addressed. PARTNERSHIP IN ACTION SSE offer perhaps one of the best examples of firms to have grasped the importance of working together with their workforce to deliver the needed changes. To quote from their Just Transition Strategy: »In periods of industrial change, trust between employer and employee is important in order to deliver a smooth transition and reduce the risk of negative social impact. Key to that trust relationship is transparency and openness from the employer and the ability for employees to engage in a meaningful way. Trade union representatives have a very important role to play too.«(SSE 2020). Looking in more detail at what other employers could learn from their example, we can see that not one but five of their 20»principles of just transition« relate to workforce voice, partnership and engagement: 3. Value employee voice(…), 5. Co-create with stakeholder(…), 14. Establish and maintain trust, 15. Provide forward notice of change(…), 17. Deliver robust stakeholder consultation«. At SSE they have been using both union and non-union channels of voice to support these changes, including the use of»Shadow Boards« for non-directors, allowing employees a route to input into business decisions including around carbon reduction plans. Croda, another example mentioned above, also recognises the importance of engaging with the workforce early on in the change process. Phil Ruxton, Chief Sustainability Officer, was appointed in late 2019 to lead advice on the company’s sustainability and decarbonisation agenda. He recalls»The first thing the Chief Executive said to me was ›forget about meeting our targets – the most important thing is making sure you engage everybody‹. The last thing we want to do is engage people too late«. Croda has a combined»Climate, Land and People Strategy« which as Ruxton explains is because the company sees these issues as inherently tied together. He sees the key aim of his role and the company’s strategy as being»to change people’s behaviour across Croda – to do that we have to engage everybody«. The company has been using town hall meetings, mailouts from the Chief Executive, webinar Q&As and video updates, along with regular pulse surveys, to discuss these issues and engage the workforce in the topic in an intensive way over the past couple of years. It’s important to note that the workforce is not limited to a passive, reactive role in these transition plans. In some firms it actually appears to be active trade union representatives themselves who are pushing forward and driving the organisation’s agenda on carbon reduction, and senior managers who are having to try to keep up with them. One good case study of trade union partnership with employers, cited by the Campaign Against Climate Change report, is the Devonport dock site.»Prospect, the union, have signed an agreement with the Ministry of Defence, Interserve and Babcock Marine and Technologies, the employers at the site, to recognise and appoint workplace Environmental Representatives to participate in sustainability and environmental issues, to reduce energy consumption and increase energy efficiency at Devonport site, along with working to reduce pollution and identify clean transport options for the site«(Campaign Against Climate Change Trade union group 2017). This need for partnership is all the more important where jobs are likely to be displaced or lost altogether as a result of the journey to net zero. The Green Jobs Taskforce report recommends that»Where businesses dependent on the high carbon economy will need to change, or face closure, due to the transition to net zero, they should take proactive steps to ensure workers, and their unions where relevant, are involved in the development of their plans from an early stage. This should, where possible, include engaging workers in affected supply chains.« The report points to the successful closure of EDF’s Cottam coal power station as an example of how to do this well. At Cottam, workers were involved, via their trade union representatives, in discussions of the transition from the very beginning of the plan’s development. While the coal plant was being closed down, the unions worked closely with management to ensure workers were moved to new employment with EDF or elsewhere, including retraining where necessary. In many firms, however, the opposite appears to be happening. Senior executives, caught off-guard by rising consumer, government and investor pressure to reduce emissions, are belatedly signing up to commitments to do so without having planned out the journey they will need to take or considering what that might involve for the workforce. Workers themselves are only starting to learn of these plans and targets after the fact, once companies finally try to implement them. By this stage it is often too late for the kind of proactive engagement described above. Sue Ferns of the trade union Prospect commented that »there are examples of employers who do this well, but that’s been relatively small scale so far. I don’t know whether employers are sufficiently equipped for the changes that are coming; I suspect not.« For those UK workers most affected by the coming changes – in the energy, oil and gas, automotive, transport or manufacturing sectors – in a lot of cases they currently seem to feel under threat and therefore understandably defensive about it. There are also problems with a lack of 9

FRIEDRICH-EBERT-STIFTUNG – JUST TRANSITION awareness on the part of large numbers of workers in affected industries. If employers are not proactive in starting difficult discussions on these topics at an early stage, the workforce are more likely to react with hostility than enthusiasm as a result of being taken by surprise and where the groundwork for a successful partnership has not been laid early enough. The Scottish Government’s Just Transition Commission warns of exactly this when discussing plans such as the oil and gas sector’s Vision 2035 strategic plan for transitioning workers: ship approach to net zero is in the interests of both sides. Unions are bodies that allow the workforce to engage in meaningful strategic dialogue and come to a collective view, rather than just being individually consulted about changes. It is the difference between each employee being individually asked their views in a staff survey, and the workforce as a whole being seen as equal partners in the journey to net zero. The same can also be true of some companies with well-developed staff forums or other representative bodies. »We believe such plans would be most effective if they are jointly developed and owned by a range of stakeholders. While Vision 2035 came about as the result of significant engagement by companies in the sector by Oil and Gas UK, our discussions with trade unions highlighted a lack of awareness among the workforce. Government can play a role in defining who has an empowered role in these discussions, making sure that voices of workers and communities are properly accounted for and weighted in decision-making«(2020). One of the pioneering approaches that some unions have been taking involves the use of Just Transition Agreements, also sometimes referred to as a Green New Deal approach, negotiated and signed by an employer and unions to jointly agree the principles that will govern the journey to net zero in a socially just way. Many UK unions refer to the 2020 agreement struck in Italy between oil company ENI and its unions as the benchmark model they are trying to see replicated in this country, so far with limited success. THE VALUE OF TRADE UNIONS As well as the risk of distrust among the workforce jeopardising plans to reach net zero targets, there also exists the danger that the workers might in some places be right to be distrustful. Unions are growing concerned that both the numbers of jobs and the terms and conditions enjoyed by the workforce at some older, high-carbon employers are not being replicated in all the newer greener employers. Promises of reskilling and redeployment are not always kept. Government failures around the closure of the Redcar steelworks back in 2015 is still remembered as an example of promised retraining that»had little impact on employability«(Coats, 2020) and led to pay reductions for most workers even as they found new jobs. Perhaps the single overarching role of trade unions is ensuring the workforce, through the power of collective bargaining, have their interests protected in circumstances where they might otherwise not be. In ensuring that a transition to net zero not only occurs on time, but is also just, unions have a vital part to play in making sure that the number and quality of jobs is not compromised. It is well established that workers in unionised workplaces enjoy better pay and conditions, on average, than those in non-unionised workplaces. As Sue Ferns of Prospect describes,»our primary role is to make sure those of our members directly affected are supported through a fair process of change. Of all those who are being directly impacted; there aren’t naysayers, people know, they understand the need for change, but they also want to be treated fairly throughout that process and they have a right to be treated fairly.« But the value of trade unions in this journey is not simply as one side of a zero-sum game that determines winners and losers from the transition. As discussed above, a partnerTim Page of the TUC outlined in 2019 the purpose of such agreements:»Companies and organisations moving to a lower carbon model should put in place Transition Agreements – agreed with unions – that cover a range of issues, including the overall number of jobs or workers employed, pay and conditions, job security, working time, job descriptions, duties assigned to job roles, training and skills, apprenticeships, retirement policy, monitoring and surveillance, performance management, health and safety implications and equal opportunities.«(TUC 2019). Other common demands unions are discussing include the recognition of»green reps« to be responsible for driving this agenda and an agreed joint approach to transition planning, that includes all environmental matters under the scope of the collective bargaining agenda. The TUC has been offering guidance and support for unions in trying to negotiate these agreements, but so far there are few tangible examples of successful agreements that have been struck in the UK along the lines of the ENI model. The Green Jobs Taskforce goes as far as to recommend that this involvement of workers, through Just Transition agreements, be mandatory for firms receiving government financial support as part of their net zero transition, as well as recommending how climate transition planning language could be worked into the Information and Consultation of Employees Regulations or other rules and guidance around collective bargaining. Beyond their role at the individual firm level, unions also have an important role to play in the wider national debate. In August 2020 the TUC published Voice and Place: How to plan fair and successful paths to net zero emissions, including valuable interviews with frontline trade union reps around the country and recommendations that put pressure on national, regional and local government to step up and provide the investment, strategy and policy needed to ensure a just transition. 10

THE NEED FOR PARTNERSHIP Individual unions have been proactive in publishing their own sector-specific plans for transition, even in the absence of any such plans from government or sectoral bodies. Prospect in October 2020 produced A Just Transition for the UK Power Sector, including calls for the establishment of a Just Transition Council for the Power Sector and demanding that the government urgently provide more detailed planning for the road to net zero in the sector. Cross-union groups such as the Trade Unions for Energy Democracy(TUED), which includes several major affiliated unions, have also been looking at how the energy sector can be made more democratic, tackling energy poverty and climate change together with improving workers’ rights and protections. Those unions with representation concentrated in affected sectors can also act as valuable partners for sector skills bodies and employer associations at an industry level. As the Green Jobs Taskforce recommends,»13. Employers and sector bodies should set out business and skills plans for the net zero transition, engaging unions and workers.« joint approach to skills across the industry or a shared understanding of how skills needs will change as the industry moves towards a zero-carbon future«(2020). In fact for the most part the counterparts for unions to negotiate or partner with do not even exist at these levels. As mentioned above, much of England lacks devolved government at the levels needed for this kind of regional planning, while at a sectoral level the employers’ associations that exist are not generally empowered to reach agreements on behalf of their member companies. There are a few structures do exist which could be developed to serve this purpose better; namely Local Enterprise Partnerships(LEPs) and Sector Skills Councils(SSCs). LEPs are business-led partnerships between local authorities and local private sector businesses, which work to determine local economic priorities and planning, including around infrastructure and skills. SSCs are similar employer-led, government-licenced bodies but organised on a sectoral rather than geographic basis. Anna Markova, now jointly sharing responsibility for this agenda at the TUC, comments that»the things we see as being important contributions from the trade union movement are partly around relationships, making sure that no worker is left behind, making sure the needs of the workforce are considered and addressed. When EDF closed their coal power station, the company gave the unions a couple of years notice and unions spent years talking to every worker and making sure every worker had a pathway(…) Unions can be better placed than top-down employer engagement to reach with learning opportunities people who haven’t had access to them.« However, while unions are active in discussions on these issues, and there are hopes that union efforts to negotiate just transition agreements at the firm level might bear fruit in the near future, channels for formal dialogue with the workforce at national, sectoral or regional level remain painfully few and far between. FORUMS FOR DIALOGUE A key difficulty faced by efforts to involve unions and workforce representatives more in the planning of a just transition, is the lack of structures in place in the UK to support this kind of strategic dialogue. Unlike in Germany, where around half of all employees are covered by industry-level collective bargaining, there are no substantial forums in the UK for industrial relations at either a sectoral level, or at a regional or national level. Professor David Coats’ report, commenting on the closure of coal power stations, notes how»conspicuous by its absence is any dialogue at sectoral level between employers, unions and government, leading to a framework agreement that could be used to shape the closure process at company and workplace level. There is no evidence of a One problem is that, while SSCs for instance may have one or two union representatives in attendance, neither of these types of bodies are generally seen as forums for formal partnership or even dialogue with workforce representatives. Both are explicitly employer-led and neither guarantee any role or representation to trade unions, who in many cases may not even have a seat at the table. Both kinds of organisation are also narrower in scope and remit than they really need to be, if they are to be capable of the long-term strategic planning needed to manage a just transition. They also lack an explicit remit that would encourage them to focus on net zero transition planning, alongside other economic priorities. Both LEPs and SSCs, however, are potential platforms that could be developed and built on. Sector Skills Councils in particular are potentially relevant bodies to coordinate the reskilling needed within sectors to allow those sectors’ workers to transition to greener jobs. As Sue Ferns of Prospect comments,»If you were starting from today you’d come up with different structures than those that exist currently(…) but thinking pragmatically it’s important to think about how you adapt or enhance structures that do exist.« With expanded remits and guaranteed union representation, these bodies could evolve into the kinds of structures that would allow genuine partnership to emerge and flourish in the UK. As discussed above, some of the combined authorities or city regions, such as the Liverpool City Region, also show just what can be achieved with sufficient political will. Similarly, the Scottish Government has taken a strong Scotland-specific approach to the issue, but the English regions mostly lack similar devolved authorities able to coordinate regional strategy. As the TUC recommends, combined authorities, local councils and LEPs need to do considerable work to»develop structures and mechanisms for engaging trade unions and other stakeholders at the heart of regional decision making and economic strategy – this should 11

come with equal weight to trade union representation as that of business and other stakeholders«(2020). Finally, there is a pressing need for some kind of structure for partnership dialogue at a national level as well. The Green Jobs Taskforce Report recommends urgently that»A UK-wide body, including representation from national government and industry, should therefore be established to maintain momentum and coherence in the workforce transition, supported by action from local bodies.« This would mean a Just Transition Council, along the Scottish or New Zealand lines, for the whole UK. Other authors, including Professor David Coats and the TUC, have called for the same thing. This would need the UK government to reverse course and re-commit itself to having an industrial strategy. Perhaps, if the terminology of industrial strategy is seen by the government as outdated, it could rebrand this as a»transition strategy«, explicitly focused on the journey to net zero. In many ways, the example of the Green Jobs Taskforce itself is the perfect model to copy or adapt to meet this need. The taskforce involved representatives of industry, unions, academics and skills bodies, along with government ministers, sat around a table working together in a spirit of partnership to map out a route towards a just transition. Rather than being seen as a temporary group, brought together to deliver a single advisory report, which may or may not be reflected in the government’s final net zero Strategy, the UK government should consider establishing a group of this kind on a more permanent basis with expanded remit and powers. FRIEDRICH-EBERT-STIFTUNG – JUST TRANSITION 12

KEY LESSONS FOR THE UK 4 KEY LESSONS FOR THE UK In some respects, the UK has done quite well so far on the journey to net zero. The transfer from coal and oil fuelled power stations to other energy sources is considerably ahead of most countries, with the UK recording numerous days in the past couple of years without fossil fuels being used in the energy grid. The relative decline in levels of manufacturing and heavy industry over recent decades, and corresponding shift towards a services-based economy, have also had the effect of bringing down our emissions compared with some other countries with a much larger heavy industry base. In June 2019 the UK was the first major economy in the world to legislate for a net zero carbon target by 2050. The structures are in place, such as the independent Climate Change Committee, to hold the government to account for this target. With COP26 being held in Glasgow this autumn, it would seem the UK is well positioned to take a global leadership role in managing the transition to net zero. Yet there is still much the UK could learn, both from other countries and from its own shortcomings. For one thing, the UK government is still symbolically yet to use the phrase ›just transition‹ as part of its discussion of this issue or recognise that such a concept is an essential part of the journey to net zero, and to fulfilling its own commitments under the Paris Agreement. JUST TRANSITION AGREEMENTS AT FIRM LEVEL One of the key lessons is the value in firms reaching Just Transition Agreements, negotiated with trade unions, to set out their pathway to net zero in a way that secures jobs and skills. Not only can such agreements ensure fairness for the workforce, but they can also greatly smooth the journey to net zero for the employer by ensuring buy-in from social partners and reducing the likelihood of an industrial dispute further down the line. As SSE outlines in »The Business Case for Action« under its Just Transition Strategy: »Along with key stakeholders, including investors and shareholders, the Company recognises the energy system transition is at risk of creating injustice and, as a result, is at risk of losing public support for the actions and investments required to deliver a net-zero electricity system in the UK and Ireland. It also believes that with considered intervention through advocacy, partnership action and thoughtful policies and practice, SSE can be an agent of influence in bringing about positive social consequences, therefore, contributing to a just transition to net zero.« In Italy, energy firm Enel has demonstrated how a just transition ethos and approach, including partnership and dialogue with the workforce, can greatly ease the pain of the transition from the perspective of both social partners, even when undertaking difficult decisions such as the closure of power stations. However, it is important to remember the limitations in importing such lessons from abroad as well. As one academic study of the Enel case explains: »It is evident from this case study that the presence of a solid system of industrial relations, with strong unions, historically non-conflictual relations between the parties and an elevated propensity to seek negotiated solutions, is fundamental to the success of the agreements on redevelopment and restructuring in Italy. These aspects must be taken into account from the perspective of the replicability of the experiences of Enel in other contexts«(Rugiero 2019). The UK, unfortunately, is not a favourable context for the replicability of such success given these criteria. Industrial relations are typically adversarial rather than collaborative and union density is low, particularly in the private sector. In the absence of strong trade unions, it might in theory be possible for alternative collective structures for workforce voice to take their place and allow meaningful dialogue to occur, but this too is not being widely seen, with limited use of the Information and Consultation of Employees regulations, multinationals withdrawing their UK workforce from a number of European Works Councils after Brexit, and most firms declining the invitation under new corporate governance regulations to establish a formal workforce advisory panel, instead opting to appoint designated non-executive directors to be responsible for workforce engagement. As Professor Coats argues,»decisive action is needed if workplace collectivism(and the possibility of genuine dialogue between workers and their employer) is to be rebuilt«(2020). 13

FRIEDRICH-EBERT-STIFTUNG – JUST TRANSITION Unions and employers alike, then, may find there is a limit in how far they can push this kind of partnership approach in the absence of any wider changes the UK industrial relations landscape. THE NEED FOR MORE SECTORAL AND REGIONAL DIALOGUE One major way in which the landscape could be rebuilt would be through the development of stronger sectoral and regional bodies for dialogue and partnership. As discussed above, the UK lacks effective forums at many levels where employers, unions and government can engage in serious dialogue and reach agreement about important decisions in the journey to net zero. All significant practical decisions about transition so far in the UK, from how and when to close power stations to how to redeploy the workforce involved, or when to provide retraining to workers, have essentially been taken at an individual site level. Sometimes these decisions have involved close dialogue with the union at the individual site-level, sometimes not, sometimes even with government involvement where the case was high profile enough, but never as part of a sector-wide plan or perspective. One of the greatest strengths of other countries, such as the German industrial relations model, is in allowing these discussions to take place at a sectoral, rather than individual site or even firm level. Such sectoral forums can take a medium to longer-term strategic view of how the whole industry’s employment and skill levels are likely to change, how new technology is likely to impact on the transition and what support is going to be needed from government, as well as lobbying with greater power to ensure they receive that support. There are already effective examples of this regional leadership in action – particularly in Scotland and in some City Regions such as Liverpool or Greater Manchester. On the whole, however, the UK(specifically England) remains unusually centralised compared with most major European nations. Even some City Regions still lack the elected Mayors that have enabled Liverpool and Manchester to take a lead on this issue and convene social partners for effective dialogue. While establishing an even level of regional devolution across the UK is probably unrealistic given political constraints the idea has faced in the past, it would help to ensure that where devolved bodies do exist they are given the fullest range of powers and encouraged to be proactive in developing regional industrial strategies in partnership with industry and unions. Where regional bodies don’t exist, LEPs could be developed with expanded remits and guaranteed union representation to fill a similar role at a smaller scale. THE MISSING NATIONAL STRATEGY Ultimately, however, regional and sectoral approaches alone are not enough. The UK needs to have a coherent national strategy in order to tie these other approaches together. The Green Jobs Taskforce concluded with a recommendation that»The government should publish a detailed net zero strategy before COP26«, including a detailed workforce component focused on green jobs, skills, training and job quality. It is still to be seen whether government will achieve this in time. The IPPR has meanwhile called for a funded legal»right to retrain« for all workers affected by the transition to net zero. Without such new rights, there is a risk workers fall into the cracks, with government, employers, unions and skills bodies all assuming one another will shoulder the responsibility of ensuring these workers get the retraining they need. The UK urgently needs to work to develop forums to fill that role; particularly for those sectors, such as energy, transport, manufacturing etc. which are likely to see biggest and most immediate impacts from decarbonisation. Establishing such sectoral forums might also offer a way to bypass what might be historically difficult industrial relations at some individual firms, by allowing those discussions to happen in a new sectoral forum, where trade unions are included as equal partners from the very beginning. Similarly, more devolution of decision-making needs to happen to a local and regional level, where a proper assessment can be taken of the impact decarbonisation will have on local communities where high carbon industries are concentrated. We cannot afford a repeat of the coal mine closures which so devastated small-town communities in the final decades of the 20 th century. A Just Transition must involve an appreciation of the importance of geography and localism – creating new green jobs in London and the South-East is little comfort to coastal towns in Scotland likely to be impacted by the winding down of North Sea oil production. These are the kinds of decisions that can only be taken at a national level, as part of a wider strategic plan. Looking abroad, Denmark’s successful investment in wind power is a perfect example of how a government can, through a long-term plan, ensure that green industries grow in a way that protects jobs and nurtures domestic skills and capabilities. In contrast, the UK’s own domestic wind investment has been entirely based around driving down costs via an auction process, in a way that undermines the ability to invest in skills and fails to invest in the long-term UK supply chain. This approach doesn’t deliver in terms of job creation and – while it may meet net zero targets – does not fit the description of a Just Transition. Similarly, Professor David Coats contrasts how»The German approach to the closure of coal fired power stations has been to establish a national commission, engaging all stakeholders, to generate a consensus about the best way forward. In the UK, coal fired power stations are being forced off the grid by the operation of the capacity market (a low price for electricity and a high carbon price), with no real scope for dialogue or agreement on a national plan.« 14

(2020). It is clear that the UK urgently needs some form of industrial strategy – these issues are too important and too large in scope to simply leave them up to non-governmental or regional actors to sort out. The UK may be well ahead of most other countries in terms of emissions reductions – something certainly worth celebrating – but it is far behind other leading European countries in terms of public funds committed to new green jobs and industries. Anna Markova of the TUC comments»I think the UK is falling behind, because of reluctance at government level to have active industrial strategy. We’re at risk of not making steel, cement, chemicals etc. anymore. If policy doesn’t catch up, that is a real risk and that is a real risk to workers.« Most other European countries have a cabinet level minister or department focused primarily on climate change issues. Some, such as France or Italy, specifically title them as a minister for the»Ecological Transition«, embedding the concept of thinking about a transition at the top of national policymaking. Currently responsibility sits within the Secretary of State for BEIS, Kwasi Kwarteng, who leads a sprawling department with wide responsibilities including business, science, research and energy. In theory having responsibility for climate change combined with business and industrial strategy could be a good thing in terms of integrating decarbonisation thinking with wider policy in these other areas. However, there are two major difficulties UK policymaking faces here. Firstly, by situating responsibility with BEIS in this way, it means there is no minister with oversight of all elements of the transition to net zero, including business, transport, education, employment and local government, all of which sit within five separate departments. Secondly, while in theory combining decarbonisation planning with industrial strategy makes perfect sense for promoting strategic thinking about a just transition, in practice BEIS today seems to be moving away from, rather than toward, embracing its responsibility for industrial strategy. The transition to decarbonisation is inherently a long-term strategic question, requiring planning on timescales far beyond the usual political cycle. To succeed, it needs two vital ingredients – leadership, and partnership. While this may sound contradictory at first glance, in fact the two concepts are complements of one another. True leadership is not about imposing top-down solutions drawn up by genius planners; rather it is about listening to the views of all affected parties and bringing people together to work collectively to achieve a common aim. Meanwhile, establishing effective partnership structures is hard; all the more so when it cuts against the grain of so much of the recent industrial relations landscape in the UK. Only with clear leadership can such structures be established and made to succeed. A coordinated Green Industrial Strategy, involving both leadership and partnership, has to be at the core of this journey. All actors in the UK need to urgently face up to their responsibilities to ensure a just transition to net zero. 15 KEY LESSONS FOR THE UK

FRIEDRICH-EBERT-STIFTUNG – JUST TRANSITION LITERATURE BBC(2021): No apology from Boris Johnson over Thatcher coal mine closures remark. Accessible at https://www.bbc.co.uk/news/uk-politics-58117044(last accessed 14 September 2021). Campaign Against Climate Change Trade union group(2017): Trade unions in the UK: engagement with climate change. Chemical Industries Association(2020): Accelerating Britain’s Net Zero Economy. Climate Change Committee(2021): Progress in reducing emissions. 2021 Report to Parliament. Coats, David(2020): A Just Transition? Managing the challenges of technology, trade, climate change and COVID-19. Community. Department for Business, Energy& Industrial Strategy(2021): North Sea Transition Deal. Environmental Justice Commission of the Institute for Public Policy Research(n.d.): Fairness and Opportunity: A people-powered plan for the green transition. Accessible at https://www.ippr.org/fairness-and-opportunity/(last accessed 14 September 2021). Haldane, Andy(2021): UK industrial strategy is dead, long may it live, in Financial Times(23.03.2021). Accessible at https://www.ft.com/content/5ed942d1-7f8e-4494-84f1-840e7e414aec(last accessed 14 September 2021). Holder, Michael(2020): Top business groups urge government to plot ›just transition‹ to net zero: in BusinessGreen(13.11.2020). Accessible at https://www.businessgreen.com/news/4023232/business-urge-government-plot-transition-net-zero(last accessed 14 September 2021). Institute for Public Policy Research(2020): Net Zero North Sea, a managed transition for oil and gas in Scotland and the UK after Covid-19. Keating, Cecilia(2020): UK utilities urged to publish ›just transition‹ plans, in GreenBiz(29.12.2020). Accessible at https://www.greenbiz. com/article/uk-utilities-urged-publish-just-transition-plans(last accessed 14 September 2021). Mace, Matt(2020): SSE unveils ›just transition‹ strategy to benefit communities during net-zero transition, in edie newsroom(20.11.2020). Accessible at https://www.edie.net/news/7/SSE-unveils--just-transition--strategy-to-benefit-communities-during-net-zero-transition (last accessed 14 September 2021). Martin, Abigail and Lacey-Barnacle, Max(2021): COP26 UK: a failure in leadership on the just transition, in Sustainability(02.02.2021). Accessible at https://www.sustainability-times.com/environmental-protection/cop26-uk-a-failure-in-leadership-on-the-just-transition/ (last accessed 14 September 2021). New Zealand – The Just Transitions Unit(2019): Wellbeing Economy Alliance. Accessible at https://weall.org/resource/new-zealand-thejust-transitions-unit(last accessed 14 September 2021). Onward(2021): Getting to zero, a practical policy commission to deliver decarbonisation in the UK. Prospect(2020): A Just Transition Plan for the UK Power Sector. Rugiero, Serena(2019): Decarbonisation in the Italian energy sector: the role of social dialogue in achieving a just transition – the case of Enel, in Galgóczi, Béla(ed.) Towards a just transition: coal, cars and the world of work. ETUI. Scottish Government(2020): J ust Transition Commission Interim Report. SSE(2020): Supporting a Just Transition. TUC(2019): A just transition to a greener, fairer economy. TUC(2020): Voice and place: how to plan fair and successful paths to net zero emissions. United Nations Framework Convention on Climate Change (2015): The Paris Agreement. 16

IMPRINT ABOUT THE AUTHOR IMPRINT Patrick Briône is Head of Policy& Research at the Involvement and Participation Association(IPA); a UK charity dedicated to promoting employee voice, partnership and engagement in order to deliver better workplace outcomes – employee wellbeing, increased productivity and improved services. The IPA is one of the few ›open spaces‹ in the UK where employers, trade unionists and other workplace representatives, academics, legal experts, human resource and employment specialists can come together with politicians and policy makers to discuss and debate employment issues and policy. Patrick joined the IPA in 2016, having previously worked as Director of Research at Survation, a market research and polling organisation, where he was responsible for the overseeing of major projects of quantitative and qualitative research for major businesses, charities and political campaigns. He has also worked at the think tank CentreForum, where he co-authored two research papers on employee empowerment and employee ownership. At the IPA, Patrick’s work includes planning, managing and delivering the IPA’s research projects, focused on the future of the workplace, employee engagement and social partnership. These are carried out with a variety of clients from trade unions, and public sector organisations to private companies and other charities. Published by: Friedrich-Ebert-Stiftung London 44 Charlotte Street London, W1T 2NR United Kingdom Responsible: Michèle Auga| Director FES London Office Phone:+44 207 612 1900 To order publications: info@fes-london.org Design: Stefanie Brendle The views expressed in this publication are not necessarily those of the Friedrich-Ebert-Stiftung. Commercial use of media published by the Friedrich-Ebert-Stiftung(FES) is not permitted without the written consent of the FES. Publications by the Friedrich-Ebert-Stiftung may not be used for electioneering purposes. ISBN 978-1-9196095-2-2 © 2021 Patrick holds a MA in Politics, Philosophy and Economics from Magdalen College Oxford. Contact: Twitter: Website: Patrick at patrick.brione@ipa-involve.com @patrickbrione www.ipa-involve.com FES London Office The London Office is part of the international network of FES. It was established in 1988 to promote better understanding of British-German relations, mainly by means of seminars and reports on political trends in the UK and Germany. The Friedrich-Ebert-Stiftung’s work in the United Kingdom focuses in particular on the exchange of ideas and discussion on the following topics: –– common challenges facing Germany, the United Kingdom and the European Union –– economic and social policy –– experiences gained from the differing regional and local policies and practices –– a continuing dialogue between politicians in both countries, particularly through a series of meetings for MPs –– a continuing dialogue between the trades unions, particularly via the annual British-German Trade Union Forum launched in 2002 For more information please visit www.fes-london.org www.fes.de/bibliothek/fes-publikationen ISBN 978-1-9196095-2-2

JUST TRANSITION Remembering the UK workforce in the push for net zero The UK’s commitments to net zero emissions by 2050 are admirable but will require change on an unprecedented scale to achieve. These changes, if not handled carefully, risk destroying jobs and livelihoods and provoking a worker backlash against them. To counteract this, the concept of a just transition has emerged; moving to net zero in a way that protects livelihoods and reduces inequality, providing retraining and new skills where required to help workers transition to new jobs. To successfully manage this transition, businesses will need to work closely with their workforces, adopting a partnership approach that secures workforce buy-in for needed changes and allows a worker voice to be heard in determining how to implement them. This is vital for both change management reasons, but also to make sure workers have a voice to stand up for their own interests. At present, most UK employers are still at the very beginning of plotting their journey down this path. Government, at both national and regional levels, has an important role in facilitating this dialogue about transition, particularly at regional and sectoral level where suitable forums for social dialogue are currently lacking in the UK. The government also needs to provide strategic leadership over transition, ideally as part of a wider industrial strategy. The recent direction of UK policymaking in this area suggests a reluctance on the part of the UK government to fully embrace this strategic planning role. Further information on the topic can be found here: www.fes.de/en/stiftung/international-work