Date: 15 March 2023
DES Notes IOD – Preparing for COP28 and aiming for Net Zero: Steering Boards towards effective Climate Governance
Board’s perspectives on the state of business & their ability to achieve Net Zero goals. Board’s Strategy towards effective Climate Governance, SDGs and ‘Net Zero Mission’. Social and Economic priorities focusing on Lifestyles, Infrastructures, Cities/ & Identifying environment friendly best business practices. Adopting sustainable technology, addressing the conundrum around technology and cost.
It is a pleasure and an honor to address the IOD 30th World Congress on the important theme Building Future-Ready Organizations.
I thank the Institute of Directors India for inviting me to share my perspective and moderate this distinguished panel on the topic “Preparing for COP28 and aiming for Net Zero: Steering Boards towards effective Climate Governance”.
Distinguished participants, we meet at a moment of incredible urgency.
In 2015, with the universal adoption of the Paris Agreement, the world leaders agreed to limit global warming to 1.5 degrees Celsius by reducing greenhouse gas emissions by 43% by 2030 and becoming net-zero by 2050.
Science tells us that we have already crossed the mark of 1.1 degrees Celsius. The trajectory is already dangerous for lives, livelihoods and the environment.
The decade for climate action is now. The urgency of climate action demands that we prioritize building future-proof and sustainable business models and organizations.
This requires transitioning from extractive economies to regenerative ones, to unlock the potential for positive contributions to both nature and society.
The decade ahead represents a crucial window of opportunity for this transition, and it must start immediately.
It is time to slash emissions across the board, transform all sectors towards a renewable and low-emissions future, and repurpose a global financial system that supports this transition.
Industry leaders, businesses, employers, and communities have started driving near-term decarbonization action by implementing sector transition plans.
But it is not enough. The world needs all hands on the deck.
The time has come to deliver on our promises and reach the milestones established in the 2030 Industry Breakthroughs, a set of comprehensive key milestones and actions for business partners, established by the UN Climate Champions last year.
As the United Nations Secretary-General, António Guterres, recently said at the UN General Assembly in February 2023, “if you cannot set a credible course for net-zero, with 2025 and 2030 targets covering all your operations, you should not be in business.”
Building future-proof organizations and businesses means putting decarbonization and resilience at the core.
Turning financial assets into flows, investing in digital technologies and renewable energy, upskilling workers to benefit jobs and livelihoods are key to securing an equitable and inclusive industry transition.
Building future-proof organizations and businesses require a mindset shift to achieve net-zero.
In the past few years, there has been a growing recognition of the need for sustainable living and a shift in global attitudes towards the environment.
This has provided a significant push towards a climate mega-trend driving sustainable systems transformation spanning all aspects of society and business.
Today’s clients and stakeholders are more concerned with the purpose of a business in the long-term, whether it’s net positive in terms of sustainable development for the world, rather than the value on the market.
This phenomenon has multiplied, especially during the last two years, in particular due to the complex and critical geopolitical context and the Covid-19 pandemic, acting as disruptors to the business-as-usual of the past decades.
It is now mainstream for many multinationals worldwide to be climate aware with 96% of the world’s biggest 250 companies by revenue (the G250) expected to set carbon-neutrality goals and pledges for net-zero emissions by 2050 in the UN Climate Change’s Global Climate Action Portal.
We have witnessed this trend at the UN Climate Change’s global annual climate conferences (in our process known as COP – Conference of the Parties) over the past seven years since the adoption of the Paris Agreement in 2015.
The rising numbers of delegates from the business and NGO/civil society areas, the value of financial pledges in the Glasgow Financial Alliance for Net-Zero or the number of partners of the UN Race to Zero campaign are proof of increased interest in addressing the threat of climate change.
COP 28
The upcoming COP28, to be held in Dubai, UAE in November/December 2023, holds great potential for progress in addressing the climate crisis.
COP28 will be the first Global Stocktake of the Paris Agreement – the first time when the world (governments, private sector, civil society) will take stock of the implementation of measures to address climate change that are enshrined in the Paris Agreement.
It will be a moment for businesses to showcase their sustainability and climate actions and accelerate the transition to green business models.
The New Collective Quantified Goal on Climate Finance is expected to see real progress ahead of 2025. Developed countries agreed to set a new collective quantified goal from a floor of $100 billion per year, taking into account the needs and priorities of developing countries.
However, governments cannot move the finance flows alone and this is an opportunity for businesses to step up and do their part of climate action.
A key achievement from COP 27 – the Loss and Damage fund – will be operationalized at COP28 in UAE.
Thus, clarity will be provided on who will be contributing to the fund and who will be eligible to receive funding. This will help vulnerable countries respond to the losses and damages arising from climate change impacts.
In a nutshell, we are in a race against time to limit global warming in order to protect, prevent and preserve our natural resources, livelihoods and lives in all parts of the world.
Sustainable systems transformation cannot be achieved without everyone doing their best – the global actors and individuals are capable of great things when we work together, across geographies and generations.
The world needs your engagement to drive the momentum from commitment to plan to action. Building future- and sustainable-proof organizations lies in your hands. Thank you for your attention and I welcome any questions.