The 26th COP concluded leaving us all with a world clearly still on a 3+ degree trajectory. This is a massive disaster for humanity. Let’s recall a simple fact: no business nor finance can brisk without people. The climate failure is therefore a business failure. It is time for business to better align statements and political influence to seriously engage governments and tackle the climate agenda. Not for the planet. Just for business.
COP 26 Closed Keeping Code Red For Humanity a Reality
I happen to have closely tracked COPs since Bonn COP5 (1999). I actually had a chance to attend several COPs. I therefore have good reasons to remember level of discussions back in previous century, as much as the tremendous progress made just between COP 21 (doubtless the best achievement ever with this COP process) and COP 26. The COP 26 came at a time when our societies are in deep need for an international and collective momentum to move forward together… and offer our youth a livable future on a planet inhabited by 8 to 10 billion people. That and an environment where climate risks are effectively controlled despite the ongoing Covid-19 crisis or growing geopolitical tensions.
COP 26 closed unsurprinsingly with a world clearly still on a 3+ degree trajectory. What we are facing counting the celcius degrees one by one is actually huge: IPCC demonstrated the abysmal gap in impacts between a 1.5°C and 2°C global warming trajectory. A half degree makes already a big difference. The desperate cry of the Prime Minister of Barbados “2 degrees of warming is a death sentence” reminded us that the climate issue is also to be seen in the perspective of human rights. But climate is too big a thing to rely on too few people meeting for just a few days once in a while…
For now, the truth is as simple as horrible to hear: After 26 COPs, greenhouse gases are still growing with no reason to believe something else will happen for now. Greenhouse gases should increase by +14% by 2030 assuming every government and every business commitments is applied. Truth based on science is the following: We need to decrease emissions by 45% between NOW and 2030 to keep on track with a below 2 degree trajectory.
Business and Finance Have not Proven Credible Across COPs
At Copenhagen COP15, we suffered from poor and insufficient business and investor community commitment. At COP21, the level of engagement coming from leading business leaders was conducive to encourage negotiators make a deal happen. At COP26, the credibility of business and finance is clearly at stake. The flurry of announcements made during COP 26 should not make us forget the essential. The bottom line is wrong. Too many previous commitments have basically overall not been applied. For example, CDP just released a report showing just 1% of funds being consistent with Paris agreement… in 2021! Why more will happen?
Climate Action and Corporate Political Responsibility
Governments value growth, job creation, wealth creation. Governments are therefore under the influence of business and finance. This is not necessarily a bad thing. This is a fact. Corporate Political Responsibility can be defined as the alignment between statement and political influence. So long as there is no Corporate Political Responsibility on climate action, governments and business are doom to face growing discontent and conflictual situations with stakeholders… and youth. There is basically no alignment as long as company commitments on climate, or government pledges are capable to make contrary commitments with zero impact on the climate agenda. For example, when a company makes the commitment to stop investing in a carbon intense business where there is already zero investment. Or when a government commits to ban domestic exploration of oil and gas without having anything to explore in country. Or when companies and governments are claiming to engage big numbers in climate related investments we are still trying to find several years later. There have been plenty of such commitments across the COP.
Now, we don’t need fluffy commitments coming from a few. We need a plan engaging the many. Ensuring business is capable to offer a plan engaging the many boils down to a few priorities we are struggling to see around us:
- Internal alignment within business organizations themselves ensuring every function / every business unit is all aligned on a same interest making climate progress a priority. This can imply to seriously restructure organizations to make sure every P&L is equally impacted by climate for instance
- External alignment from business associations supporting regulation (talking here namely about the business associations representing whole industries at DC, Brussels, Beijing and other similar critical locations shaping regulation on behalf of the critical GHG emission producers for the whole planet), capacity building, certification, tax incentives making it possible to change the market rules and shape alignment along value chains
Conclusion: No Climate Action, No Business
If governments, business and finance are unable to prove more credible, and basically drastically decrease emissions now, we are exponentially going to witness climate disobedience happen. Rule of law shaken on behalf of climate. This is not good for business. This is not good for governments neither. Climate action is business action.
Author of several books and resources on business, sustainability and responsibility. Working with top decision makers pursuing transformational changes for their organizations, leaders and industries. Working with executives improving resilience and competitiveness of their company and products given their climate and human right business agendas. Connect with Farid Baddache on Twitter at @Fbaddache.
