- Several countries announced more ambitious pledges and an accelerated timeline for climate action at COP26 in Glasgow.
- Countries also made commitments to reverse deforestation and reduce methane emissions.
- Organisations that do not meet expectations are likely to lose customers, employees and suppliers.
So, was 2021 COP26 held in Glasgow a missed opportunity? Yes and no. Like all negotiations there were successes and disappointments, but I believe the outcome was as positive as we could have realistically hoped for.
The interconnected global nature of climate change means that COPs [Conference of the Parties] – for all the sometimes justified criticism they receive – are essential as they determine what outcomes are achievable and the global pace of change.
There is agreement among governments and investors that a large and fast transformation will deliver the best outcome for economies, investments, and businesses. The opportunities this represents explains why COP26 had more corporate CEOs in attendance than all previous COPs.
It is also clear that private sector investors are increasing the momentum through their cash/investment allocation – and that government commitments, or nationally determined contributions (NDCs), are following.
Here are five key COP26 outcomes that stood out to me.
1. Nationally determined contributions (NDCs)
At COP21 in 2015, the Paris Agreement committed to reducing emissions to limit global warming to well below 2°C and ideally to 1.5°C above preindustrial levels. Before Glasgow, the latest Intergovernmental Panel on Climate Change (IPCC) findings showed that unless actions are taken immediately, temperatures may rise by 2.7°C by the end of the century.
COP26 saw increased intent and the ratcheting up of ambition, with key countries announcing new pledges, including India which delivered a new promise of net zero by 2070, and China‘s announcement to reach carbon neutrality by 2060. Recent analysis by the International Energy Agency (IEA) has calculated a shifting of trajectory to a 1.8°C temperature increase if all these announced commitments are met.
While this is still not enough, the summit saw an accelerated timeline for climate action. Countries have been asked to come back in a year (rather than the Paris five-yearly commitment) with more ambitious plans for cutting emissions.
2. Complementary announcements
Even though the desired 1.5°C goal remains out of reach with current commitments, COP26 saw many new major announcements which complement the NDCs.
More than 100 world leaders have promised to end and reverse deforestation by 2030.
The Global Coal to Clean Power Transition Statement was announced where more than 190 parties, including China and Poland, agreed (but didn’t pledge) to transition from “unabated” coal power generation to clean power.
The Global Methane Pledge was announced at COP26 and launched by the US. The pledge commits signatories to reducing their overall methane emissions by 30% by 2030, compared with 2020 levels.
3. Finalisation of the “Article 6” rules on the international use of carbon offsets
After six extra years of negotiation following COP21, the last piece of the Paris Agreement has been finalised. The clarity and transparency that these rules provide will enable countries wanting to cooperate internationally to achieve their NDCs more quickly and at less cost.
4. New international sustainability related financial disclosure standards
The establishment of the International Sustainability Standards Board (ISSB) to develop globally consistent sustainability and climate-related financial disclosure standards was also announced at COP26. This initiative will increase the ability of investors to assess these attributes for the companies they invest in.
This will enable them to better direct their capital towards organisations who are grabbing the enormous opportunities arising from the transformation to a decarbonised economy as well as those organisations that will be more resilient to this future.
5. Climate finance
COP15 in 2009 saw the creation of a Climate Finance pledge to provide US$100 billion a year to developing nations by 2020 to help them adapt to climate change and mitigate the impacts of severe weather events. By 2021 this pledge had not been met with only US$80 billion provided. Sadly, the failure to deliver on this commitment has fuelled mistrust among the countries and slowed down overall progress.
But COP26 generated other large announcements related to climate finance:
- The governments of South Africa, France, Germany, the UK, the US and the European Union (EU) announced an ambitious long-term Just Energy Transition Partnership. This partnership has an initial commitment of US$8.5 billion to support South Africa’s decarbonisation.
- The Glasgow Financial Alliance for Net Zero (GFANZ) announced that this financial sector alliance of more than 450 firms could deliver over US$100 trillion of capital to transform the economy to net zero.
- 114 world leaders committed to halt and reverse forest loss and land degradation by 2030. The pledge is backed by US$12bn in public and US$7.2bn in private funding.
What comes next?
The agenda to decarbonise has been updated from Paris 2015, and now the pledges, commitments, and promises must now be delivered.
The mechanisms established in Glasgow will increase transparency, and accountability, for these commitments. Not only will governments be held to account for their promises, but also sub-national governments, industries and businesses who have the power, capabilities, and supply chain influence to implement the required changes.
Those organisations that act slower than technologies permit are likely to be penalised by voters, customers, employees, providers of capital and even suppliers.
Picture: Adrian King CA.
“Organisations that act slower than technologies permit are likely to be penalised by voters, customers, employees, providers of capital and even suppliers.”
Most importantly, there are plans to be developed and implemented. These are not just Gantt charts, but plans that incorporate intergenerational equity and principles for a just transition. The transformation activities also provide us with the opportunity to improve many of our current challenges across nature, biodiversity, gender, human rights, hunger and poverty.
I am hopeful that with the heightened sense of accountability and scrutiny, we will see these important announcements continue to drive emissions reductions.
Find out more:
COP26 Climate Change Hub
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