From declarations of intent to concrete measures

The text below is a translation of an op-ed that was published in the Börsen-Zeitung.
Together towards implementation; that’s the motto of the 27th UN Climate Change Conference, taking place now in Sharm el-Sheikh, Egypt. Because confronting climate change requires solidarity and joint efforts across business, politics and society. This year’s climate conference (COP 27) will draw the world's attention to three global issues: Climate Change, Biodiversity, and Just Transition – long-term challenges that will prevail long beyond the geopolitical tensions, inflation and energy crisis of 2022. While last year's conference was focused on "Uniting the World to Tackle Climate Change", this year, it’s all about working together to put our climate promises into action. There’s no room for delay.
The key goal of the COP 26 conference was to obtain commitments to the 1.5-degree reduction target: Phasing out coal, reducing methane emissions, halting deforestation, and accelerating the adoption of electric vehicles. Remarkable as these pledges were, they only reduce projected global warming from 2.2 to 1.8 degrees. This year, instead of campaigning for additional pledges or reworking national climate contributions, we will see a greater focus on the implementation of current plans, as well as the showcasing of climate action and adaptation strategies in action.

Restore solidarity

In 2022, it became clear that there is still much potential for the fabric of today’s global economy to be woven tighter together. COP 27 must strike the right balance between optimism and realism in order to restore the notion of solidarity among nations. To this end, social factors and the topic of biodiversity will be featured more prominently on the agenda. The only way to regain the momentum that was lost in 2022 is through a more coherent and cooperative approach when it comes to people, planet, and climate.

What are the main themes of the conference likely to be? Let's start with the elephant in the room: How will current economic and geopolitical events affect our path to the 1.5-degree reduction target? There is a real risk that the short-term political mandate to ensure affordable energy supplies will slow the transition to cleaner energy sources and the phasing out of coal.

On the other hand, new opportunities are arising; weaknesses in our current energy mix are coming to light, forcing us to rethink our energy supply more urgently, and twice as many companies joined the Science Based Targets Initiative (SBTI) this year compared to 2021. The significant progress we are seeing in renewable energy in China, Europe, India and the USA is also cause for optimism. The Science Day and Solutions Day that form part of the COP 27 agenda will cover the full spectrum of climate risks and opportunities.

First Act: Finance Day

COP 27 will begin with Finance Day, with the Glasgow Financial Alliance for Net Zero (GFANZ) initiative in the spotlight. This initiative was launched prior to last year's event to address some of the challenges facing the financial sector. It’s a collaborative approach, which looks at financed emissions, progress on the phasing out of coal financing, as well as regional policies and priorities. In June, GFANZ published draft guidelines for comment, on the topic of net-zero transition planning for financial institutions. However, this remains a voluntary initiative; formal regulatory steps and policy guidance will likely be necessary, as well as closer alignment with public financing measures.

Remaining on the topic of finance: During COP 27, two key topics will be in focus: The $100 billion climate financing plan, and Just Transition, which looks at the social aspects of transitioning to a more climate-friendly economic system. It’s clear from the latest report that the world was still behind schedule in 2020. What’s more, any mobilization of capital is concentrated in middle-income countries with lower risk profiles.

Denmark is a positive counterexample; the significant increase in the country's direct and indirect commitments illustrates the key role of public-private initiatives in the transition to a more climate-friendly system. Perhaps, however, the conference will address not only the $100 billion issue, but also the International Monetary Fund's (IMF) recent climate note and the question of how to ensure funds are effectively channelled to low-income and higher-risk states.

Focus on biodiversity

Last year, we assumed that from 2022 onwards, biodiversity would be assigned the same level of significance as climate change. While we’re not quite there yet, it’s worth noting that three different theme days at this year’s conference will address the topic: Adaptation and Agriculture Day, Water Day, and Biodiversity Day. Extreme weather events are occurring with increasing frequency – recent examples include one of the worst droughts Europe has seen in centuries, as well as the flooding in Pakistan. The important role that biodiversity plays, both in protecting well-being and in the context of climate change, is becoming increasingly clear. In December, the UN Conference on Biodiversity (COP 15) will take place in Montreal, where countries will discuss a global framework for biodiversity for the coming decade. COP 27 could be the perfect opportunity to pave the way for this discussion. All in all, it's clear that 2022 has taken a toll on the climate agenda, but despite the short-term headwinds, the need to develop climate solutions remains. It is unlikely that the agenda will evolve in a linear fashion in the process; the same can be seen in the case of emissions. Building on the progress made on renewables, the financial sector can play an essential role - as part of the solution. Because despite the headwinds from recent events, the interplay between the public and private sectors is critical to success when it comes to climate finance innovation, with a view to developing solutions for our economies and societies.
Global Head of Sustainable & Impact Investing Matt Christensen speaks about this year's focus for #COP27: "Delivering for the people and the planet". The expected shift from pledges to evidence of climate mitigation, Action and Adaptation Strategies underscores the sense of urgency around implementation.

List of Public Events at COP 27

For all days and full calendar please read more here.
High-Level Expert Group (HLEG) on the Net-Zero Emissions Commitments of Non-State Entities
November 8, 14:30 - 15:30 CET
UN Climate Change (Youtube)
From Ambition to Action: Mobilising Finance for Climate Solutions and Resilience
November 9, 11:00 - 13:00 CET
UN Climate Change (Youtube)
From commitments to action: the recommendations of the UN Secretary-General HLEG on Net-Zero Emissions Commitments of Non-State Actors
November 9, 14.30 - 16.00 CET
Ministerio Transición Ecológica y Reto Demográfico (YouTube)
GFANZ: Encouraging the Role of the Private Sector in Climate Related Initiatives and Climate Transition
November 9, 15.00 - 16.00 CET
UN Climate Change (Youtube)
Panel on Private sector mobilisation and innovative finance
November 9, 16.30 - 17.45 CET
Panel on Private sector mobilisation and innovative finance (YouTube)
High Level Meeting of Caring for Climate Roundtable (UN Global Compact)
November 10 , 9.00 - 11.00 CET
UN Climate Change (YouTube)
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