The way our societies currently measure development and prosperity is strongly biased and incomplete. This leads most individuals and organisations to prioritise polluting activities whose net benefits to society have been artificially increased through the failure to correctly price their social and environmental impacts. The polluter-pays principle is therefore not being implemented, which is akin to granting large subsidies to polluters which must then be paid by the whole of society, and disproportionately by the most vulnerable groups.

This is why greenhouse gas emissions in most regions of the world must be priced at levels which incentivise an economy-wide transition to low-carbon processes. This can be reached with robust carbon pricing policies, avoiding excessive protections such as free allocation of permits and high caps in emissions trading systems, the use of carbon offsets, and the continued distribution of fossil fuel subsidies.

We envision a transition to a society where the largest emitters take responsibility for their actions and the cost of climate mitigation is fairly distributed in line with the benefits that have accrued to large polluters. Carbon pricing, if implemented correctly, can be a tool to make our world more sustainable and less unequal, by using the revenues from pricing schemes to support the poorest and most vulnerable communities in their transition.

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