The G7 Summit in Hiroshima, 19-21 May, represents a pivotal moment for global cooperation and a commitment to building a resilient, equitable, and sustainable world for future generations.
Why business and government must act on the IPCC climate change report
In the race against climate change, every fraction of a degree by which the global temperature rises counts. Every country – and every business – must bring the best they have to this race with the shared goal of winning it.
The latest IPCC report makes these truths indisputable. Climate change is happening, human activities are the source of the problem and our norms need to shift rapidly to limit further damage. We are in the red zone; we don’t have time to lose.
The report proves that to win the Race to Zero, it’s imperative that we go all in on climate action, collaborating across both business and government. We need to do it now because the window of time to stabilize the climate is vanishing fast. This year the G20 and COP26 are decisive moments for the future of humanity.
The IPCC report shows it is still possible to limit global temperature rise to 1.5°C, but we are already dangerously close to that threshold. We must both halve emissions and reverse nature loss by 2030.
How do we make the strides needed to limit the most catastrophic effects of climate change? What system changes need to be put in place and what has proven effective so far?
Crucially, hundreds of global companies are already building the foundations of exemplary corporate climate action proving it’s possible to get on track for halving emissions by 2030. They’re demonstrating, just as they have done during the COVID-19 crisis, that business has an incredible ability to adapt and deliver rapid, wide-scale change.
These companies are already making swift adjustments to ensure they continue to perform well while aligning with this climate goal – tasking everyone from CEOs to engineers and marketers to develop and scale up the solutions that will prevent every further fraction of a degree of temperature rise.
Companies like Mahindra Group, Unilever and Cemex are making real progress. They’re among nearly 700 businesses, collectively employing around 24 million people and representing $13 trillion in market capitalization or value, that are setting 1.5°C-aligned, science-based targets and implementing plans to help halve emissions globally by 2030 through the Business Ambition for 1.5°C campaign. Another 110-plus companies are working together to help reach the goals of the Paris Agreement 10 years early through the Climate Pledge. Actions taken include switching entire value chains to renewable power, making transport fleets all electric and innovating new, lower-carbon ways to manufacture products.
Business ambition is, in turn, triggering market signals that drive governments and financial institutions to act. Around 70% of the global economy is now committed to net-zero by 2050. As many global superpowers adapt to stay aligned with the latest climate science, we’re increasingly seeing climate policy regulation enforced at the national level.
Both the US and EU, along with a growing list of other countries, will require that emissions are collectively reduced by at least 50% by 2030 to stay on track for reaching net-zero by mid-century. These nationwide climate targets provide clarity on the long-term direction of travel and strengthen the case for countries to set clear end dates for coal and cars powered by petrol and diesel. For example, in the EU, ministers are actively considering a ban on all new combustion engine cars by 2035.
The level of voluntary corporate climate action so far proves that if governments create the conditions for success, business will innovate and scale climate solutions – many of which already exist. They must do it now, because companies have much to do to decarbonize not just their operations, but their value chains as well.
We need to mainstream climate action. We need millions of companies to get on track for halving emissions by 2030 — and to reach these goals, governments need to play their part.
Within the wide range of policies that governments need to adopt, there are some that are indisputable: ending coal and scaling up EVs and renewable power. But the severity of the climate crisis demands transformational policies in every country and in every sector. Businesses urgently need clear and consistent government policies aligned with a 1.5°C target to urge them to make investments and decisions that will decarbonize the global economy.
Further, governments should develop these policies in close dialogue with the corporate climate leaders working to reduce emissions because they can bring immense insight and innovation to the net-zero transition. Governments can gear the market towards low-carbon activities in the pandemic recovery by stopping fossil fuel subsidies, putting a price on carbon and making climate-related financial disclosure mandatory.
To enable every country to take part in the transition, wealthier countries need to deliver the $100 billion per year of climate finance required for developing countries so they too can bring their brilliance to the race to reduce emissions.
The science is alarming, but we can’t let that overwhelm us. We need to harness every ounce of our incredible power to halve emissions by 2030. The power of ingenuity, determination and, fundamentally, of love for our lives and our shared home on this planet can bring about the change that is necessary. By redefining the rules, governments can support businesses to do what they’re best at and ensure that together, we achieve this monumental task.
This article was first published by the World Economic Forum.
Across the two weeks, non-State actors offered a wide range of actions, announcements, and events across thematic areas. This included the launch of the African Cities Water Adaptation Fund, an African-led insurance commitment to provide cover for up to USD 14 billion in climate losses, and the Sharm-El-Sheik Adaptation Agenda in partnership with the COP27 Presidency.
Africa Carbon Markets Initiative launched to dramatically expand Africa’s participation in voluntary carbon market
The new Africa Carbon Markets Initiative (ACMI), which was inaugurated today at CO27, aims to support the growth of carbon credit production and create jobs in Africa.