How can we unlock the sustainable business opportunities of COP26?
EXCLUSIVE: Businesses must use COP26 as an opportunity to improve the climate narrative, making it more engaging and accessible, while also pushing policymakers for more clarity on laying the foundations for the net-zero transition.
That was the conclusion of a panel of expert speakers, representing the UK Government as well as business giants Virgin Media O2 and Centrica Business Solutions, at edie’s COP26 Climate Action Workshops, hosted in London today (5 October) for members of edie’s exclusive networking clubs.
Chairing the panel discussion, edie’s content director Luke Nicholls asked each of the four speakers for their thoughts on their key ingredient for success at COP26, and how they would define a failed Conference in Glasgow.
The COP26 unit’s business engagement lead, Bridget Jackson, reiterated COP26 President Alok Sharma’s call to “keep 1.5C alive” through Nationally Determined Contributions (NDCs) to the Paris Agreement. The UN’s recent Synthesis Report on NDCs concluded that current commitments would deliver a projected decrease in global emissions of 12% by 2030, compared to 2010 levels. However, a 25% decrease would be needed to deliver a 2C world, or a 45% decrease to deliver a 1.5C world.
Jackson’s definition of a poor COP would be a situation in which “the narrative that comes out of the Conference is that it has failed, and that [the agreed outcomes] will stall momentum in all the different industries in the private sector.”
She elaborated: “This is going to be quite a nuanced event; it’s not as clear-cut as when the gavel came down on the Paris Agreement. It will be much more won in the narrative this year and, so, for all of our sakes, we have to make sure we come out of this with a sense of momentum – a feeling that it really can be done.”
Centrica Business Solutions’ net-zero analyst Brendan Abadie agreed with Jackson on his definition of a poor COP, adding: “It is as [Jackson] says – it is the bad press. If we don’t sort this out and get the investment going, we will have developing countries losing faith in the process, and that’s only going to spiral.”
The Department for Business, Energy and Industrial Strategy’s (BEIS) policy advisor on net-zero public engagement, Sam Lux, argued that the negotiations risk alienating small businesses in the UK as well as world leaders in the Global South, without an improvement in narrative.
She said: “From a small business perspective, I hope that COP26 makes everyday people feel like they are part of a growing community who are empowered to take action; to feel they are recognised for the hard work they have already put in – especially at a really difficult time like this.
“Like [Jackson], I know it’s important they feel energised going forward, to take further action.
“A bad COP would involve everything happening at the high level, with momentum reserved for the climate world that we [on the panel] are probably all in. It needs to translate to a wider audience across the UK and the world.”
Virgin Media O2’s head of sustainability and social impact Will Kirkpatrick also spoke to the importance on momentum in the private sector being ignited – and sustained post-COP26. Indeed, the UK’s presidency does not officially end until COP27 begins.
Providing his definition of a successful event, Kirkpatrick said: “Hope is an incredibly powerful lever that you can put to work in a crisis. Yes, accelerated action. Yes, ambitious targets. But we have to set the tone and demonstrate that we can collaborate.
“It’s incredibly important in a business like ours that we have that belief and that we can take that back home, inspiring other people to get behind the cause.”
Policy and business action: A chicken-and-egg situation
Building on these discussion points, a sustainability professional in the audience asked how businesses can ensure that NDCs and other parts of the Paris Agreement rulebook “trickle-down” to regional, city and industry levels. He stated that “we’ve been here before, many times, in terms of political commitments being made but a lack of delivery on the ground”. He added that: “many of us [in the audience] work in businesses where the political landscape is the major barrier for activity in delivering net-zero solutions”.
Answering this question, Jackson said: “I think what we will see as businesses – many of you will know me in my corporate sustainability director guise at PwC UK – is two to three years of really bumpy regulatory introductions around the world as nations play catch-up, if you will, with momentum in the market.
“This is well-documented by organisations including the UN Principles for Responsible Investment (PRI), which has stated that 2023 and 2024 are going to be when we have a slew of regulation that catches up with the momentum of the climate agenda.
“As businesses, you will need to respond to that and get ahead of the game. One of the easy things to do is to decarbonise, lowering future expenditure on carbon prices, taxes and so on. Secondly, get ahead of the game on innovative products and services as far as you can, because then, you can use your business voice to say you want a level playing field.
“We’ve all seen huge levels of ambiguity with Covid-19, as we’ve never seen before in business. So, keep on asking, through your government relations, for more clarity and for faster policy changes to come through. The collective voice of business will help that clarity to come through.
“Also, the pressure for us as businesses - I think – is likely to come from the financial sector sooner than it will from government. Be in no doubt. About a year ago there were $5trn of assets under management whereby alignment with a 1.5C temperature pathway was promised…. the sector had aimed to double it to $10trn but there’s now $90trn. That’s half of the global economy. If you need to access funding in your business, you are going to be asked to be 1.5C aligned, and I think that’s going to give clarity and momentum, while also encouraging and involving governments to put forward the regulatory frameworks we need and the investment we need to pump-prime new technologies.”
The business guide to COP26
What's happening on each day of the COP26 climate summit this November? How does the COP process work, and what are the desired outcomes? In the final run-up to the talks, edie's definitive business guide to COP26 has you covered.
This free-to-download guide, sponsored by EY, breaks down everything you need to know about the sustainability opportunities of COP26. The guide includes a full summary of what we know so far about the talks, who's involved, what's happening on each day, and what your organisation can do to turn the ambitions of COP26 into business actions.