The Climate of Business #53: COP27 - less pledges, more action?

Climate Change Reality

Amid climate change, water managers see promise in recycled wastewater (NPR)

Climate change means the Inuit do what they've always done: Adapt (Reuters)

Who pays for the climate havoc? (The New York Times)

The fastest-growing cities face some of the biggest climate risks (Axios)

How climate change is fuelling hurricanes (Reuters)

Climate migration: Indian kids find hope in a new language (AP News)

The world is too busy to do its climate summit homework (Bloomberg)

Spike in Amazon emissions linked to law enforcement (BBC)

Activists take over billboards to call out impact of flying on global carbon emissions (Euronews)

Business Climate Reality

Australia - a land of promise and hurdles for offshore wind developers (Reuters)

Federal government's $20billion embrace of 'climate smart farming' (The New York Times)

France announces €45bn effort to shield country from energy cost increases (The Guardian)

EasyJet to scrap carbon offsetting to focus on cutting emissions (Euronews)

Patagonia’s groundbreaking announcement proves small actions can create big impact (GreenBiz)

Carbon-credit surplus could soon turn to shortage (The Wall Street Journal)

Egypt’s Foreign Minister calls for improved climate commitments at COP27 (UN News)

In Chile's desert lie vast reserves of lithium - key for electric car batteries (NPR)

If companies really want to do some good, they should unbundle ‘ESG’ and ‘DEI’ (Bloomberg)

What truths can emerge from an Italian food systems summit? (GreenBiz)

Reality Check

COP27 is taking place in November in Egypt and this time we should expect and in a way demand more action, as many pledges have already been made.

The conversations there won't be simple as the last few years have brought a lot of instability to the world economy due to the COVID19 pandemic and the war in Ukraine. Both these events have put emphasis on the instability of our supply chain, our energy mix and the sustainable transformation of our economy that shall speed up.

COP27 historically has been a political event, as it has been organised in the last three decades by the United Nations bringing together almost 200 countries, but as climate change expands its negative impacts across all stakeholders, businesses have gotten progressively over the years more involved.

The hopes yet again for COP are high. Last year a lot of pledges both by governments, and businesses were made. All of these pledges are yet to to be fulfilled. For this reason COP27 is being looked at as the opportunity to develop further stringent global proposals and for governments and businesses to explain how these promises will be fulfilled.

This year's convention will be heavily focused on practical policies and processes that can push the pledges into action. And it is crucial for corporations to be on the loop for what practicalities and regulations will arise in order to keep up.

Where and when is COP27?

COP27 will be held in the Egyptian resort town of Sharm el-Sheikh from 6 to 18 November 2022.

What are the key topics of COP27?

Already during COP26, the private sector mobilised. However the trillions and actions promised suffered under the unforeseen circumstances that occurred after.

• Key themes this year are Financing and Implementation
• International trade took a hit in the last years but it is now being look as an engine for inclusive economic growth
• The financial sector will be in the spotlight as the discussions on the transition deepen - key focus: PPPs, climate adaptation, loss and damage financing, energy transition
• Another focus will be leveraging green technology
• 15% of some of the largest public companies have set themselves 50% emission reduction targets to be achieved by 2030. This year many will have to explain how they plan on implementing these pledges.
• Methane and how to eliminate this potent has discussions will take a centre stage

What happened at COP26?

• Glasgow Climate Pact, which included a commitment to end “inefficient” fossil fuel subsidies and “phase down” coal. Many stakeholders were disappointed by the final text, which was considered to be watered down in several places (phase down, rather than phase out).
• A few multilateral agreements around deforestation (The Glasgow Leaders’ Declaration on Forests and Land Use), rapid action on methane, climate finance ( the Glasgow Financial Alliance for Net Zero (GFANZ)), and leaving fossil fuels behind.

What should businesses prepare for?

• Details - enough pledges have been made and repeating them won't satisfy the audiences. Businesses should expect to be able to share detail around their decarbonisation and sustainable transition plans, especially in the light of all the greenwashing legislation (especially EU) and governmental action which was established in the past 12 months
• Going beyond emissions - emissions are one of many KPIs which will be discussed at COP27. Water, land use, climate adaption planning and financing for the transition will be all considered in the discussions.
• Moving to renewables as scale - the energy crisis has posed the obvious question of a shortened in timeline transition to renewables. Businesses will need to have detailed plans for how they plan on investing projects which can decarbonise their production, suppliers, investments. Experts predict legislation around this topic will further strengthen as a result of COP27.
• Greenwashing - Experts share a view that greenwashing and frameworks around eradicating it will be confirmed during COP27. Businesses should prepare to discuss their approach to safeguarding themselves from any missteps in such context.

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