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What is green economy? Definition and meaning

As the world transforms with the evolution of technology, climate, politics and economics, there are interconnected practices which positively balance environmental and social goals for the good of nature,  citizens, and businesses. Leading the way is the green economy, an economic model that prioritizes the success of human well-being and social equity, while reducing environmental risks and ecological scarcity. But what is the meaning of green economy? By definition, a green economy is the practice of sustainable development through the support of  public and private investment to create infrastructure that fosters social and environmental sustainability. The importance of green economy is that it encourages economies to become more sustainable and low-carbon, and ensures  that natural assets continue to provide the resources and environmental services for our continued well-being.

What are the principles of green economy?

The green economy is a people-and-nature-centric model whose main principles are:

  • wellbeing
  • justice and good governance
  • poverty eradication
  • energy-efficiency
  • low-carbon development

 

It takes a long-term perspective on the economy, by focusing on the ways in which resources are used to deliver value to society, how efficiency and sufficiency of resources can be forsters to create wealth, resilience and wellbeing for today’s and future citizens within the ecological limits of the planet. From investments in wellbeing to sustainable practices, the characteristics of a green economy are inclusive and non-discriminatory.

What are the business opportunities of the green economy transition?

The challenge for companies transitioning to a green economy is to deliver economic growth while fostering a symbiotic and positive relationship between nature and humans.

Green economy business opportunities emphasize creating a healthy environment and promoting the well-being of all by promoting the use of low-carbon technologies and practices, and using technologies that rely on clean and renewable energy.

 

The transition to a green economy business is necessary for companies to achieve sustainable development targets. This healthy circle encourages resource and energy efficiency and promotes sustainable production, enabling the use of environmentally friendly technologies, processes, and products.

The Circular Economy

The Circular Economy

A new model for creating value

While achieving a green economy through such efforts as decarbonization is time consuming and requires capital spending, it is increasingly being seen by businesses themselves as creating green economy business opportunities. Innovation, after all, is the main source of all economic growth and the green economy is no different.  McKinsey estimates that green economy business opportunities could generate between $9 trillion and $12 trillion in new revenue by 2030 in sectors including transport, power, and hydrogen.  According to the OECD, some sectors will grow more than others, but within each sector, companies using resources more efficiently will have a competitive advantage.

Green growth and sustainable development as drivers of green economy

Green economy is good for communities, businesses, and the planet.The idea that growth, development and well-being can be achieved through sustainable practices is what undermines the concept of green growth.Green growth does not replace sustainable  development. Instead, it provides a practical and flexible approach to making concrete and measurable progress across its economic and environmental pillars, taking account of the social consequences of greening economies' growth momentum. The goal of green growth strategies is to ensure that natural resources can express their full economic potential sustainably. 

What is the difference between a green and circular economy?

If green economy is defined as interconnected economic activities that promotes global scale sustainable development, poverty eradication, environmental protection, and eco-efficiency and low-carbon development, the circular economy is a regenerative development strategy for economic growth that focuses on restoration, use of renewables, and elimination of toxic chemicals and waste through the superior design of materials, products, systems, and business models. They are joined by the common goal to reconcile environmental, economic and social goals.

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