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Governments and policymakers increasingly look at state ownership of companies to accelerate meeting sustainability objectives. This is both promising and risky. It could have negative effects on competition, the rule of law and geopolitics. NWO, the Dutch Research Council has awarded a grant to dr. Jasper Sluijs to develop a new research agenda examining state ownership as it relates to sustainability efforts in Europe. Sluijs is assistant professor in competition law and regulation at the Utrecht ľ¹Ï¸£ÀûÓ°ÊÓ School of Law.

Two recent examples of state interference to promote sustainability: the French government forced (partially) state-owned airline Air France to cut domestic flights in 2020, while the Dutch government announced nationalization of district heating schemes in 2022. Both initiatives follow from the rationale that state ownership of these firms, rather than private ownership, accelerates meeting sustainability objectives—in these cases emission targets, energy transition and energy independence. 

The potential of state ownership in (for instance) achieving the goals of the European Green Deal is clear. However, little is known about the governance conditions under which state ownership can best deliver on its potential towards sustainability objectives. This ‘governance gap’ becomes more pressing when you consider the potential risks of increased state ownership: distortion of competition in markets, increased chances of corruption and geopolitical conflict.

The Impact of EU Law

Dr. Sluijs’ awarded proposal will critically examine the promise of state ownership related to sustainability, with a potentially ground-breaking impact on the success of sustainability efforts in the EU and beyond. The project will explore the research question: How can the EU legal framework optimize the potential of state ownership towards sustainability, while mitigating the risks that come with increased state ownership?

Governments increasingly rely on state ownership in their sustainability policies. My research helps addressing the risks this reliance creates.

The tension between the promise and risks of state ownership towards sustainability objectives is relevant to be explored from the perspective of EU law. The European Green Deal, for example, is considered a leading initiative with effects far beyond the EU’s territory. At the same time, the span of sustainability and the EU legal framework require further scoping in order for this research to become truly impactful. This NWO grant, therefore, supports dr. Sluijs in 2023 and 2024 to develop a long-term, collaborative research program on state ownership and sustainability.