In 2021, the publication of the first part of the Sixth IPCC Assessment Report has made it clear: the world must act now to limit the consequences of climate change. At Mercedes-Benz, scientific findings and the dialogue with experts are the basis for the necessary technological progress. This is the only way we can achieve our goal of CO2 neutrality by 2039.
Facts only influence our behaviour to a limited extent
INTERVIEW WITH Prof Dr Dr Felix Ekardt
Prof Dr Dr Felix Ekardt is Head of the Research Centre for Sustainability and Climate Policy in Leipzig and Berlin and Professor of Public Law and Philosophy of Law at the University of Rostock. He has been researching in matters of law, ethics, politics, and transformation conditions of sustainability for 25 years. Felix Ekardt is active in political consulting and is the author of numerous specialist articles. In 2021, together with the lawyer Dr Franziska Hess, he also obtained the noted decision of the German Federal Constitutional Court on climate policy1. We asked him for his opinion on key issues in the climate debate.
Prof Dr Dr Felix Ekardt
Head of the Research Centre for Sustainability and Climate Policy in Leipzig and Berlin
A frequently used argument against intensified climate protection is that it will place a disproportionate burden mainly on people with low incomes. What’s your opinion?
This is all to do with the fact that the opportunities for freedom between the generations must be balanced more fairly. The Federal Constitutional Court confirmed this in its ruling. The effect of climate protection on the balance of social equality is more good than bad, because climate change itself would cause a much more problematic distribution of social goods than even the most radical climate protection policy.
What does the term “climate justice” mean to you? In your opinion, who has to create a balance in whose favour?
When it comes to climate protection, the freedom of those who produce and consume here and now competes with the right to the elementary prerequisites of freedom: life, health and a subsistence income — worldwide, and also for future generations. The democratic majority has some creative freedom in this area. Constitutional courts have the task of safeguarding certain limits as we weigh the alternatives. This is precisely why Germany’s Federal Constitutional Court intervened, because we are in the process of very quickly using up the small remaining budget we still have for reaching the goal of limiting global warming to 1.5 °C.
How would you categorise the results of the IPCC with regard to climate justice and the automotive industry?
Sustainability requires a lifestyle and an approach to resource management that are viable in the long run and on a global scale. In order to solve various environmental problems such as the climate crisis, loss of biodiversity, distorted nitrogen and phosphorus cycles and the pollution of soil, air and waterways we have to leave certain drivers of destruction behind us. We need to use zero fossil fuels and about 75 percent less livestock farming and pesticides. These problems would then be largely solved. The legally binding 1.5 °C limit set by the Paris Agreement implies that we must implement all of these requirements by the start of the 2030s all over the world and in all sectors, including the transportation sector. Fossil fuel drive systems may no longer be used after that point. Possible compensations for greenhouse gas emissions such as bog or forest management don’t change that necessity. This is because we need these compensations for residual emissions in areas such as food production.
People always blame others
Why do we find it so difficult to translate our knowledge about the harmful effects of fossil fuels and excessive meat consumption into concrete actions?
Knowledge of the facts and ethical values — in other words, aspects of awareness — have only limited influence on our behaviour. For members of the public, politicians, managers and everyone else, other factors are often more important — factors such as calculations of self-interest, path dependencies, and the fact that the climate is a collective good that can’t be controlled by individuals. Also important are people’s concepts of normality, which are often confused with ethical values. It somehow seems “normal” to eat meat every day, fly to a holiday destination several times a year and become more and more wealthy over time. Perhaps emotional factors are the most important here: laziness, habit, mental avoidance, a tendency to make up excuses, inability to imagine complexity — and especially the tendency to scapegoat others. Climate change is somehow ultimately the fault of the Chinese or Donald Trump; as for me, I’m completely blameless — even though here in Germany we have one of the world’s biggest climate footprints per capita.
Is “green” consumption a legitimate way to make a fair contribution to climate protection at the individual level?
Social change takes place through the interaction of diverse players, all of whom are subject to the motivation factors I’ve just mentioned. Politicians, members of the public, lobbyists and journalists, who all depend on one another as if they were caught up in vicious circles, populate the political sphere. In addition, the political sphere is interdependent with the sphere of production and consumption, which is ultimately populated by the same people who in turn are interdependent on one another. In other words, if we want to reset the framework for our consumption, success will depend on the interaction of many players. That’s because green consumption can mean a technological as well as a behavioural transformation. Both will be necessary if we are to stay within the 1.5°C limit. In the interplay of change, we will need voluntary green consumption as well as political commitment to a change of lifestyle and of economic activity.
Demanding and promoting a different kind of politics
What exactly do you mean by a political commitment?
A different kind of politics is only going to be possible if we all demand it — so people should join political parties, join associations and join the demonstrations. Another prerequisite for a different kind of politics is that as many people as possible show in their personal spheres how we can live and do business differently. This kind of cooperative action is the only way we can break through the various vicious circles in which all of the participants and spheres are involved. Referring to individual actors is pointless; that would lead to the old question of which came first, the chicken or the egg. And it is by no means just a matter of more factual knowledge and values. If we set the course within the political framework and in our personal activities for zero fossil fuels and less livestock farming and pesticides, these harmful factors will disappear from the market either completely or partially — through technological and behavioural transformations.
What does the pathway toward this new normality look like to you?
The central political toolbox has to start operating at the EU level. Otherwise, problems would only be shifted to other countries. If we establish an improved emissions trading system that covers all fossil fuels and also animal products and pesticides in a similar way, we would make our reduction target more ambitious than it has been so far. If we close all the loopholes — and if we do all this in 15 years at the most — we can still reach the binding global targets for the climate and the environment. To round off this effort, the EU would have to work together with other countries that are moving along a similar pathway to introduce environmental tariffs against countries that are not participating in these measures. If that doesn’t happen, we would once again be shifting emissions to other countries. Individuals will then experience a temporary increase in the price of fossil fuels — effects that steer us toward technological and behavioural transformation. If we target emissions trading with a goal of zero fossil fuels by around 2035, fossil fuels will simply no longer be on the market at some point.
Less consumption and climate-neutral products
Of course behavioural change also means that we have to rethink our attitude toward consumption. From a corporate perspective, would companies earn enough money from frugal consumers to secure jobs?
Technological change creates growth and jobs. By contrast, less consumption may lead us into the post-growth society. Companies, the job market and social insurance will need new concepts to deal with this. It makes sense for an individual company to orient itself toward emission-free services and products as soon as possible.
From a climate-policy perspective, is it correct to include transport in the national emissions trading system – what do you think?
This is an initial step toward the expanded EU emissions trading system I’ve been describing. The biggest question for Germany’s new “traffic light” government is whether it will accept the EU’s proposals for intensified climate protection. In order to reach the 1.5°C target, the government would have to demand a further improvement of the EU recommendations — for example, a more ambitious EU reduction goal and a more consistent closing of loopholes in the emissions trading system.
From your perspective, what would a convincing narrative about the future look like? What role could car manufacturers play in it?
Car manufacturers will have to focus more strongly on leasing and sharing than on selling vehicles. They will have to become general providers of mobility services. In addition, all of their products and services must be completely in the post-fossil-fuel category.
Prof Dr Dr Felix Ekardt
is Head of the Research Unit Sustainability and Climate Policy in Leipzig and Berlin and Professor of Public Law and Law Philosophy at the University of Rostock. He has been researching law, ethics, politics and transformation conditions of sustainability for 25 years. In 2021, together with the lawyer Dr Franziska Heß, he obtained the decision of Germany’s Federal Constitutional Court on climate policy, which received worldwide attention.
1 1 BvR 2656/18, 1 BvR 288/20, 1 BvR 96/20, 1 BvR 78/20
At a glance: The current state of the climate
The “Intergovernmental Panel on Climate Change” (IPCC) is the United Nations body that assesses the scientific evidence on climate change. In its Sixth Assessment Report, it provides information on climate change, its causes, possible impacts and possible responses. The graphic below illustrates the most important findings on the current state of the climate system and climate change. Further information on the work of the IPCC and the current report can be found here.
We’ve achieved a lot more than was conceivable at the beginning
The publication of the first part of the Sixth IPCC report in 2021 used hard facts on the status quo of climate change and possible subsequent scenarios to make it clear: Society, business and governments need to act! In this name contribution Jana Krägenbring-Noor, Head of Corporate Environmental Protection and Energy Management, reveals what is needed for the sustainable transformation of an internationally operating company — and why there’s no alternative to a sustainable business strategy.
Head of the Corporate Environmental Protection and Energy Management department at Mercedes-Benz AG
When I look into the sunset on vacation at the Baltic Sea and watch the seabirds along the horizon it not only energises me, but makes me aware of how important it is to keep nature and people in harmony. With this goal in mind, I start my laptop in the morning and am happy that I can help to shape sustainable action at a company like Mercedes-Benz. About four years ago, my team and I were given an important task: to create an even greater awareness within the company of how our actions affect the environment. Sustainability should be at the centre of business, and it’s not just a matter of putting locally emission-free automobiles on the road.
Sustainability must be the guiding principle for every employee’s actions
In fact, a sustainable business strategy means integrating sustainability into all processes along the value chain. This is a huge task that can only be successful if everyone participates. My team and I are working intensely, as we always have, to keep things moving and serve as the driving force of the strategy and implementation process. In a way, asking the right questions has to become a part of the organisation’s DNA: how is climate and environmental protection relevant for my tasks, and what aspects do I have to keep in mind? How does this decision affect resource consumption and the CO2 footprint? Where can I also improve in ways that are not measured by performance indicators? We’ve already made big progress on these issues, and not just in vehicle development and production.
This highly dynamic process of change is increasingly being influenced by investors who demand sustainable action. One response to this was the first green bond in the amount of one billion euros, which the Mercedes-Benz Group issued in September 2020. The second green bond of the same amount followed in March 2021. The net proceeds from these issues are used exclusively to fund green projects. This enables investors to participate directly in the attainment of the sustainability goals and at the same time ensures that we have the liquidity we need to make important investments for the future.
This is necessary because our efforts as a company are embedded within a legal framework set by politics. For example, the goals of the Paris Climate Agreement must be implemented, so that targets and incentives are set not only for individuals, but for society as a whole – because that’s the only way that the climate can be effectively protected in the long term. At the European level, car manufacturers for example are given fleet limits. It should be noted that the goals of our Ambition 2039 go beyond these requirements.
We want to become CO2 neutral by 2039 – the goal we set ourselves in May 2019 with the aforementioned Ambition 2039 programme has since gained enormous momentum, both internally and externally. From my point of view we’ve made much more progress over the past two years than was originally thought possible. In my opinion, the decision of the Executive Board to set sustainability targets for all areas is the basis for this success. Environmental protection is being directly managed and put into practice in our daily work.
It makes me proud that we have in fact exceeded our targets defined for 2021 in some areas. For example, we have succeeded in reducing the amount of cobalt in the cathodes of the EQS’ battery cells to less than ten percent – a significant improvement compared to previous battery generations. Our procurement unit also made great progress. For example, Mercedes-Benz has agreed to purchase battery cells produced in a CO2 neutral manner as part of its strategic partnerships with battery cell partners CATL, ACC and Farasis. Starting with the EQS, we will only procure CO2 neutral battery cells for our new all-electric passenger car models. This will save around 30 percent of the emissions from battery production.
Step 1: Taking stock of (life cycle) assessment
But how can we know where the need for action is particularly acute or where reduction measures are especially effective? To answer this question, our first step for all units is to take a close look at our consumption. In doing so, my team and I concentrate on how we can employ a holistic approach to improve the products’ environmental compatibility and reduce the environmental impact. If you want to permanently improve the life cycle assessment, you need to take a 360° view of the entire life cycle: What impact do the raw materials already have? How much energy is needed for production, how do the various drivetrains influence the CO2 balance during the use phase, and what effect does the use of recyclates have? We can now evaluate all of this not only manually, but also automatically, from the raw material to practically the last screw, so to speak. As a result, we know precisely what measures we have to take in order to improve climate neutrality, enhance environmental compatibility and reduce resource consumption. The life cycle assessment of the EQS, for example, shows that we are on the right track from today’s perspective with our electric–only approach. Calculated for the life cycle as a whole, the EQS’ CO2 balance is 80 percent better than that of its combustion engine counterpart, given the EQS is charged with green electricity. Compared to the conventional S-Class, the higher emissions from the production of the EQS are already offset after just 20,000 kilometres. A few years ago, we would have considered such figures to be merely visionary.
Keeping materials in circulation
We also take a close look at the materials used in a vehicle. Moreover, we take on responsibility for our supply chain even though we don’t pull all the strings here. Our goal is to conserve valuable resources as well and to use as little of the primary raw materials as possible. At Mercedes-Benz, we have therefore set ourselves the goal of increasing the use of recycled materials to 40 percent by 2030. With regard to plastics we’ve already made good progress: seat covers made of 100 percent recycled PET bottles, floor coverings made of processed fishing nets and fabric scraps instead of tufted velour. Moreover, we are using cable ducts made of recycled household waste. The EQS alone contains a total of 80 kilograms of resource-conserving materials. I was totally thrilled when I had the chance to experience the Vision EQXX that we unveiled in January 2022. The vehicle’s interior, for example, contains many materials that aren’t from animal origin.
In fact, 95 percent of a vehicle can be recycled today. However, as we progress towards a circular economy, we have to bear in mind that the steel from recycled end-of-life vehicles today is generally not used to produce a new automobile, but rather for steel girders in a multi-storey building. Although there is nothing wrong with this as such, it also means that the high-quality automotive alloys are tied up for another purpose. We want to get closer to the “closed loop” in automobile production. In the case of our high-voltage batteries, we attach great importance to recycling and reuse even before recycling. For example, defective batteries are reprocessed for reuse in vehicles. When a battery is no longer suitable for road use, it is reused in a stationary energy storage unit in order to offset peaks in consumption in the electricity grid. Once this application likewise comes to an end, the battery is recycled so that valuable raw materials can be recovered.
Minimising raw materials risks by means of technological progress
Although recycling processes are already very advanced, batteries contain valuable raw materials that are sometimes critical. That’s why we want to steadily reduce the amount of critical raw materials that are used per vehicle. We design our vehicles to be as resource-conserving and environmentally friendly as possible over their entire life cycle. In vehicle development we call this approach “Design for Environment”. This is why it’s all the more important that the individual components are analysed for their social and environmental risks before the first vehicle sketch is made. The ESSENZ method that we developed in cooperation with the TU Berlin and other partners provides information about the scope of the risks. This method assesses, for example, how the raw material deposits are distributed across the earth and whether their exploitation could be associated with human rights risks. In the latter case, it supplements our Human Rights Respect System. The results help us to gain a clear picture of the potential environmental, economic and social risks that are associated with the use of a given raw material. To date, the Mercedes-Benz Group has identified 24 such risk-related raw materials, including cobalt and lithium, which we will only procure from certified sources in the future.
However, our aspirations go far beyond industry-wide standards. In the medium-term, we want to reduce the amount of critical materials used by keeping second-use raw materials in the cycle for as long as possible. At the same time, our engineers are working at full speed to increase the energy density of lithium-ion technology. This enables us to reduce the proportion of critical raw materials used as well. With success: The proportion of cobalt in the new generation of batteries has already been reduced to below ten percent. Our goal is to completely change the material composition. Whereas today’s battery cells contain comparable amounts of nickel, manganese and cobalt, most of the cobalt in the lithium-ion battery cells might soon be replaced by nickel. In the future, we want to use post-lithium-ion technology to dispense with nickel and cobalt completely in batteries.
Achieving CO2 neutral production with green electricity
We have also taken a great leap forward in vehicle production. The use of sustainable energy increased further in 2021. Since 2022, purchased electricity has come entirely from renewable sources, and production at the car and van plants of Mercedes-Benz is CO2 neutral throughout the world. However, the availability of green electricity at all of our locations worldwide proved to be one of the key challenges. That’s because local conditions often differ widely. Green power wasn’t always available or couldn’t easily be routed to the places where we needed it. We therefore sought dialogue with the plants worldwide and drew up individual solutions for the green power supply. In addition to the expansion of photovoltaic systems, this was an essential key to achieving CO2 neutrality in production. However, we can’t dispense with offsets completely yet. In the future, we especially want to improve facilities that require a lot of process heat.
What we can learn from ESG ratings
Incidentally, whether our transformation is basically on the right track is reflected in more than just our share price. ESG ratings are becoming increasingly important means of depicting our performance alongside the financial rankings and trend analyses of the capital market. These scores provide us with guidance because they let us know which topics are currently trending and where we have to make more rapid progress. That’s why investors consider ESG ratings to be an important indicator of whether our investments are sustainable.
I’m very confident with regard to our company’s transformation. This positive feeling greatly motivates me in my daily work. For me, it’s very important that I work for a company that has made environmental protection its priority. At Mercedes, we are driven by the goal of reconciling mankind and mobility with the environment. Knowing that we work hard to achieve our goals, I can take a deep breath during an evening walk with our four-legged friend in the woods and meadows and look forward to the next working day.
is the Head of the Corporate Environmental Protection and Energy Management department. As a member of the Sustainability Competence Office, she coordinates the Group Sustainability Board. Her department covers the areas of sustainability, environmental protection, and energy management at Mercedes-Benz AG and is responsible for compliance with environmental and energy policy.