COP 28 Forecast: A Primer on Climate Impact for Businesses
COP28 kicks off today and the sustainability industry is abuzz. We want to get you up-to-speed and share our expertise about this event's impact on your business.
First Global Stocktake COP28:
This year, the Paris Climate Agreement mandates the first Global Stocktake, or in-depth analysis of progress against climate goals. The Paris Agreement requires this evaluation every five years to determine where we are in global warming projections. According to the Synthesis Report, the result of the data collection and analysis phases of the first Stocktake, we are far behind meeting targets to curb warming to 1.5 degrees, as the Paris Agreement lays out.
The Synthesis Report does provide roadmaps for setting us back on track to avoid the greatest climate catastrophes and reduce emissions. As defined in COP24, the Global Stocktake specifically focuses on climate change mitigation, adaptation, and implementation. From this, we’re expecting renewed pressure on countries to adopt measures for steep emission cuts, requirements for resilient infrastructure, and new investment in sustainable solutions.
The Four Paradigms of COP28:
Stemming from the expected results of the Global Stocktake, COP28 has laid out four paradigm shifts to put the world on track to meeting the Paris Climate Agreement goals during the convening this year. These shifts are as follows:
Fast-tracking the energy transition and slashing emissions before 2030 by creating decarbonization pathways in line with the Paris Agreement which phase out fossil fuel use and production. This will take the form of ending fossil fuel subsidies, reducing energy consumption, and investing in renewable energy.
Transforming climate finance by delivering on old promises and setting the framework for a new deal on finance. To act on climate change, this intended outcome of COP28 seeks to unlock innovative finance opportunities to support emerging economies.
Putting nature, people, lives and livelihoods at the heart of climate action. As we see the effects of climate change begin to play out on our communities and ecosystems, this paradigm shift places importance on adaptation measures. It puts a “human face on policy choices” so as to ensure quick delivery.
Mobilizing for the most inclusive COP ever. This specifically focuses on augmenting the voices of youth, Indigenous Peoples, and women and their representation at COP28. It also places emphasis on increasing participation of these populations in climate solutions post COP28.
What does this mean for business?
The pressure to realign global reality with global climate goals will trickle down into the private sector. From what we currently know about the Global Stocktake and the established four paradigms, we expect global leaders to amplify pressure on steep emissions reductions, create incentives for climate innovation, and invest in adaptation measures. More specifically, this is how COP may affect your company:
Mitigation: We are already seeing increased regulation on corporate GHG emissions transparency—e.g. EU Corporate Sustainability Reporting Directive, California’s Climate Accountability Package — and are expecting more as each country strives to curb national emissions as quickly as possible.
Adaptation: Along similar lines to reporting corporate GHG emissions, new regulations are also requiring the disclosure of business resilience to climate change. This creates transparency around the infrastructure most vulnerable to effects of climate change and identifies steps to improve that vulnerability. This most reflects reporting to ESG frameworks such as the Task Force on Climate-related Financial Disclosures (TCFD) or the Sustainability Accounting Standards Board (SASB).
Implementation: This policy segment focuses on unlocking capital in support of climate mitigation and adaptation. It is expected that governments will further engage the private sector to meet climate finance needs and encourage financial institutions to shift from fossil fuels to more sustainable options. As a result, investors may prioritize companies contributing to innovative solutions.
We will learn more as COP28 unfolds, but these trends pose a distinct choice for companies: avoid acting and face significant business risk from new regulation and stakeholder expectations or act now and turn potential risk into abundant opportunity.
If you are ready to seize climate opportunities, the Uplift Agency can support you in going beyond compliance to creating a holistic ESG Strategy, inclusive of transparent reporting to meet your unique business needs.
The Uplift Agency
Uplift builds strategies, programs, and communication campaigns that advance ESG in workplaces, supply chains and communities.
We know how to navigate the road ahead because we’ve already been down it – 90 percent of our team has led environmental or social programs in corporations or nonprofits. Because ESG is all we do, our services are more comprehensive and integrated than most firms.
