Green developers In the World Economic Forum’s equitable transition country archetype framework, green developers are industrialized economies with diversified production structures and deep industrial value chains. With 24.7% of the global population and 53.6% of global real GDP , they account for the largest share of global greenhouse gas (GHG) emissions (47.3%) while also leading in innovation and finance and hosting most of the largest firms in the world. Almost 40% of businesses in these countries are concerned about their capacity to remain competitive in the green transition because of higher costs of energy and key commodities as well as regulatory uncertainty and compliance burden. Lack of sufficient demand due to consumer affordability and appetite for green products is also a hot spot, cited by 23% of executives compared to 17% globally, with elevated concern in transport, mobility and infrastructure sectors. In part due to deep financial sectors, executives in green developers are less worried about investment capacity and access to finance than in most other countries (21% vis-à-vis the global average at 31%). Similarly, organizational culture and resistance to change are only highlighted by 17% of executives (below global average at 22%), but the share increases to 24% in the infrastructure sector (above global average). While only a small minority of businesses are facing difficulties in accessing green technologies (14%, below global average), many of them (78%) are concerned that technological divides might exist among companies in the decarbonization of at least one large industry in their country, reflecting the risk that the strong green technology base might not benefit equally all businesses in these countries. Finally, while companies in these countries own most of the patents necessary for the green transition, some face challenges in securing critical raw materials, resulting in one out of five businesses in this group highlighting this barrier (above the global average at 15%). In the US, approximately one-third of businesses highlight higher costs of energy and key commodities, lack of demand and affordability of green products among consumers and regulatory uncertainty and compliance burden among the key barriers they face to remain competitive in the green transition. Concerns over market demand stand out as significantly higher than globally and in peer countries (31% vis-a-vis 17% global average). Similar to other countries in this archetype, companies in the US might face asymmetric access to financing and technology needed for the green transition, while over 50% of executives have highlighted concerns about the job displacement effect of decarbonization in at least one key industrial sector in the country. In Japan, higher cost of energy and key commodities and slow ROI are the two leading barriers to climate competitiveness, cited respectively by 48% and 38% of executives and well above global and peer averages. Third, approximately one-third of businesses highlighted regulatory uncertainty and compliance burden, in line with other peer countries. One out of five executives identified limited access to critical raw materials as a key barrier to competitiveness in the green transition, more severe than in most of the rest of the world; while access to financing, green talent and technologies are better than peer countries and the global average. Concerns over worker displacement are also strikingly low at 11%, likely cushioned by high social protection coverage at 95%. Higher costs for energy and key commodities are by far the most pressing concern among businesses in Germany when it comes to remaining competitive in the green transition, with almost four out of 10 executives sharing this challenge. Access to critical raw material comes second, cited by 26% of executives, well above peer and global averages. One out of four businesses face regulatory uncertainty and compliance burden, the third most pressing concern, but well below peer countries. Similarly, financing-related barriers are less pressing: slow ROI and limited investment capacity and access to finance are each cited by only 17% of executives. Finally, almost four out of 10 German businesses are concerned about workers’ displacement due to the decarbonization of one or more industries in the country, slightly above global and peer averages. In South Korea, regulatory uncertainty and compliance burden are by far the most pressing issues among businesses when it comes to remaining competitive in the green transition, cited by 61% of executives, well above peer and global averages. High energy and commodity costs follow at 43%, as the country currently sources less than 4% of its total energy consumption from renewables, while almost one out of three businesses experience limited investment capacity and access to finance – well above peer levels. South Korean businesses are also concerned about the distributional impacts of the green transition. Over nine out of 10 expect asymmetric access to green financing among companies and higher costs for consumers as a result of decarbonization in one or more key industries in their country, significantly above other countries. Making the Green Transition Work for People and the Economy 27

Making the Green Transition Work for People and the Economy 2025