COP26: Business leaders, investors, and royalty make final plea to world leaders
On the eve of the climate conference, influential actors from around the world call on governments to deliver climate action pledges that are in line with the goals of the Paris Agreement
On the eve of COP26 a host of leading green business groups have today urged governments to do everything in their power to deliver a successful outcome to the crucial Glasgow Summit, highlighting how effective policy signals could unlock the trillions of dollars of low carbon investment needed to deliver net zero emissions by mid-century and limit global warming to under 1.5C.
Leading the way, the Aldersgate Group, an alliance of top UK businesses, released a statement this morning calling on governments to deliver a clear pathway to keeping global warming below 1.5C at COP26. They urged leaders to respond to the challenges set out by COP26 President-designate Alok Sharma during his speech at UNESCO earlier this month, emphasising the need to phase out coal power and ramp up levels of international climate finance.
The group also called on major emitters to increase their emission reduction pledges – known as nationally determined contributions or NDCs in the UN jargon – to bring them into line with a 1.5C warming trajectory and delivering on the $100bn of climate finance promised to developing nations.
“COP26 is a crucial opportunity to show that the international community can build on the Paris Agreement and take another step towards significantly reducing global emissions,” said Nick Molho, executive director of the Aldersgate Group. “The stakes couldn’t be higher, with the IPCC leaving us in no doubt that we have reached a code red for humanity. Businesses now want to see bold commitments and tangible steps from all major emitters to get the world on track for the 1.5C target, prevent the worst impacts from climate change and unleash the low carbon investment the world economy urgently needs to see.”
In a similar move, 90 members of the World Economic Forum’s (WEF’s) Alliance of CEO Climate Leaders published an open letter this week that outlines steps governments can take to help businesses slash their emissions, building on a series of sector-specific policy recommendations the group set out this June. The alliance then called on governments to eliminate fossil fuel subsidies, cut tariffs on climate friendly goods, incentivise clean technology ‘first movers’, and ramp up investment in climate adaption. And this week’s letter reasserts the CEOs’ calls for world governments use the COP26 Climate Summit to take up these proposals so as to halve emissions by 2030 and reach net zero by 2050.
“This letter sends a clear signal days before world leaders meet in Glasgow to agree measures that can safeguard our climate,” said Antonia Gawel, head of Climate Action Platform at the WEF. “Chief executives are committed to ambitious, and science aligned climate action, and welcome bold policies to accelerate decarbonisation efforts around the world at the outset of this critical decade.”
The call from business leaders is backed by a new Systems Change Lab report, authored by a collaboration of global organisations, including the UN High-Level Climate Champions and Bezos Earth Fund, which finds that the current rate of decarbonisation is insufficient to meet the Paris Agreement’s 1.5C goal and calls on every sector to accelerate its efforts to transition towards net zero emissions.
The State of Climate Action 2021 report, published yesterday, reveals that actions such as phasing out coal in electricity and restoring wetlands need to happen at more than double the historical rate of change, while global climate finance needs to increase 13 times faster, at an average of $436bn a year over the next decade, to deliver the world’s climate goals.
Naoko Ishii, executive vice president of the University of Tokyo Centre for Global Commons, which supports the Systems Change Lab, said: “The findings from this report are a stark reminder that we need a serious multi-stakeholder coalition of governments, corporations and citizens to break the inertia and displace the incumbent, emissions-intensive economic structure. Working together to simultaneously flip the system is the only way to bring us on to the pathway to safeguard global commons.”
The Prince of Wales today also joined the wave of calls for accelerated climate action ahead of COP26, announcing a series of initiatives from his Sustainable Markets Initiative (SMI) that aims to mobilise private sector investment in green projects to help unlock the estimated $4tr needed to reach the 1.5C goal. The SMI’s new initiatives include a report identifying the actions governments can take to unlock increased investment, a new partnership with the Task Force on Nature-Related Financial Disclosures, and a project development tool to encourage private sector investment.
“Only the private sector has the trillions of dollars of finance available which we will need to create the necessary new infrastructure and meet the vital 1.5C climate target that will save our forests and farms, our oceans and our wildlife,” Prince Charles said. “What today’s announcement shows is that over the last two years the 300 CEOs who are part of the Sustainable Markets Initiative have not just talked about these issues, but have taken action. As we approach COP26 they have earned a seat at this most important table so that we can tackle the environmental crisis in partnership.”
Similarly, a statement signed by 733 institutional investors, with more than $52tr in assets under management, this week urged governments to implement measures that would unlock increased private investment in climate solutions. The statement calls for measures to end fossil fuel subsidies, mandate climate risk disclosures, and end public investment in carbon-intensive infrastructure in economic recovery plans to align policies with 1.5C trajectory and eliminating emissions by 2050.
The letter reads: “Our ability to properly allocate the trillions of dollars needed to support the net-zero transition is limited by the ambition gap between current government commitments (as set out in NDCs) and the emissions reductions needed to limit global average temperature rise to 1.5-degrees Celsius.”
The calls for bolder action from across the business community were today echoed by Pope Francis, who recorded a special message for the BBC’s Thought for the Day, urging world leaders gathering in Glasgow to take “radical decisions” that offer “concrete hope to future generations”.
“Climate change and the Covid-19 pandemic have exposed our deep vulnerability and raised numerous doubts and concerns about our economic systems and the way we organise our societies,” the Pontiff said. “We have lost our sense of security, and are experiencing a sense of powerlessness and loss of control over our lives. We find ourselves increasingly frail and even fearful… We can confront these crises by retreating into isolationism, protectionism and exploitation. Or we can see in them a real chance for change, a genuine moment of conversion, and not simply in a spiritual sense.”
Many of the specific calls made by business groups and campainers ahead of COP26 are expected to be rejected by governments in Glasgow, at least in part. Analysts are sceptical the fortnight of talks will deliver a universal formal agreement to end fossil fuel subsidies, cut tariffs on green goods, or unleash national climate action plans that put the global economy on track for less than 1.5C of warming. But the Summit is expected to deliver a wave of fresh national and industry-led initiatives to curb the use of coal power, ramp up climate finance, and accelerate the deployment of clean technologies, while also delivering a wave of net zero targets that could keep the 1.5C goal within reach.
Reports today suggested this weekend’s G20 Summit – which acts as a curtain raiser for the COP26 Summit in Glasgow – will also underscore support for limiting temperature increases to below 1.5C. The draft version of the G20 communique reportedly commits leaders to accelerating climate action in line with a 1.5C warming trajectory, including through phasing out inefficient fossil fuel subsidies by 2025, slashing greenhouse gas emissions “substantially” over the next decade, and delivering promised climate funding to developing countries.
The hope is that the package of commitments from the world’s leading economies – including the US government’s new infrastructure bill and China’s updated NDC – will help alleviate inevitable opposition from some petrostates and those poorer nations that believe richer nations are not doing enough to help them respond to escalating climate impacts, allowing for an ambitious agreement to be finalised in Glasgow. Businesses will not get everything they want from COP26, but they might yet get the clear investment signals and bold national decarbonisation policies they need.
