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Each day FT Leader writers on the Editorial Board meet to discuss the topics to be considered for Leader columns. Here are the issues that dominated this week:

This week has been defined more than most by large political and geopolitical news, reflected in our leader output. Ahead of the Nato summit in Madrid, we urged governments to prove their unity in the face of Russia's brutal war on Ukraine - in particular to promise speedy defence of Nato's eastern flank, and to break Turkey's block on Swedish and Finnish succession. Within days Ankara happily acceded on the latter point; the bloc must now make good on its fine words on the former. "As in the Cold War, Nato allies must be ready once more to put serious effort and expense into preparing for something it hopes will never happen — with the aim of making sure that it never does."

Earlier we had written on Covid, and the importance that governments not be sanguine about the risks ahead, given expert predictions of new more virulent strains in the autumn. "Now is the time for governments around the world, distracted by the cost of living crisis and Russia’s war in Ukraine, to plan their responses."

Last night we focused closer to home and urged the government in Westminster to be proactive and broad-minded if it is to see off Scotland's fresh attempt to seek an independence referendum next year. "Much of what the Johnson administration has done to date, however, runs in the opposite direction, from driving through the hardest possible Brexit to a governing style that relies on ‘wedge’ issues to retain power."
This week, tensions escalated sharply between Russia and the West.

Hot on the heels of the EU and G7 meetings, western leaders were back at the negotiating table for two days of talks at a summit in Madrid, where Nato secretary-general Jens Stoltenberg told them: “We meet in the midst of the most serious security crisis we have faced since the second world war.”

The US will strengthen its presence in Europe with additional troops and weaponry, in the largest scaling up of Nato defences since the cold war and in response to Russia’s invasion of Ukraine. Germany, too, has vastly increased military spending.

The aim is to stiffen Nato’s first line of defence, with a permanent HQ for the US 5th Army Corps in Poland; 5,000 additional troops in Romania and increased deployment in the Baltic states. All this in addition to more than 100,000 US troops already in Europe.

Sweden and Finland have been formally invited to join the alliance after Turkey dropped its veto to their membership bids.

Our analysis f rom the summit explains how the military alliance is responding to increasing threats on its eastern flank

Sanctions are another form of attack, and Nato is focused on a potential risk from China. The US is keen to persuade the alliance to view Beijing as a threat, though Germany and other European states are less keen. Putin’s rupture with the West has turned Russia towards China. Washington has sanctioned five Chinese companies to send a “powerful message” to anyone backing Moscow’s invasion.

All of this puts open trade and the global commons at risk, as the FT’s Martin Wolf points out.

The G7 has set out plans to prevent Russia from profiting from its invasion of Ukraine, which has sent energy prices soaring. Russia has significantly reduced gas supplies to Europe in recent weeks, and is already sidestepping international sanctions with ships in the Black Sea exporting food from Crimea, as an FT investigation has found.

And there are more UK sanctions this week against several Russian oligarchs, most notably an asset freeze and travel ban for Norilsk mining group chief Vladimir Potanin. He is estimated to be worth £13bn. Norilsk is a crucial supplier to the car industry, dominating the world’s supply of nickel for electric vehicle batteries.

In climate news, war in Ukraine and the subsequent energy crisis did not prevent the 27 EU member states from thrashing out a deal to pursue tougher climate policies.

A ban on the sale of combustion engines by 2035 and a crackdown on products linked to deforestation were among plans agreed in Luxembourg. But critics say states have inserted too many loopholes to push the continent to achieve its targets.

The bloc aims to be carbon neutral by 2050 through its Green Deal climate law, though the choking of Russian gas supplies has forced some member states to fire up mothballed coal plants to reduce dependency.

In another climate-related read, try our interactive graphic and explainer to see if climate labelling would change the way you shop. Denmark is developing proposals for food labelling. Most consumers in the UK and US and various European countries support the idea.

And this week’s FT Books Essay looks at the future of farming. Can agriculture solve the problems it helped to create and sustain humanity without destroying the planet?

In corporate news, the chief executives of Nestlé and Unilever pledged to make their supply chains deforestation-free, and urged others to join them. Writing in the FT, Mark Schneider and Alan Jope argued that without deforestation, achieving net zero targets will be impossible and urged food, land and agriculture industries to join them.

Elsewhere, the craze for Special Purchase Acquisition Companies - or Spacs - has come unstuck. It took off in the early stages of the pandemic as stimulus measures from the Fed increased appetite for risk. Spacs raise cash by listing on a stock market before seeking merger with a private company.

But as interest rates rise and regulators become more interested, investors are losing interest or growing wary. Of the 66 listed in Europe since the start of 2020, just 13 have found a company to merge with, and only eight of those deals have been completed.

“The Spac market in Europe seemed to go from 0 to 100mph and then back to 10mph within the space of 15 months,” observed one adviser. The clock is ticking for the 58 European blank-cheque companies yet to nail a merger.

UK companies that tried to ride the Spac wave have been crushed, losing on average 61 per cent of their value - more for those that listed in the US.

Ethics were in the spotlight, after EY agreed a record $100mn US fine with the US Securities and Exchange Commission over exam cheating. Dozens of employees at the Big Four audit firm were found to have cheated - in an ethics exam.

And in Japan, drama at Toshiba, Fujitec and Toray has turned AGM season into a fascinating spectacle, Domestic corporate governance is a rubber stamp no longer.
Bonuses less likely to reward staff for hitting green targets

This article is brought to you by FT Specialist’s Agenda, a publication that focuses on corporate boards.
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