Climate summits have attempted to reach a consensus and firm international agreements on emission reduction strategies. However, countries continue to lag behind in the climate promises – many do not back their ambitious targets with real, measurable steps.
With the UN Climate Change Conference (COP28) on the horizon, the world’s attention is fixed on how the conference can operationalise climate outcomes.
Read on to find out about the pivotal discussions and potential breakthroughs that COP28 holds in the global fight against environmental change.
Download ‘Eyes on COP28: Shaping the Direction of Global Climate Policy’ as a PDF.
After the resounding success of the inaugural event last year, Ecosystm is once again partnering with Elevandi and the State Secretariat for International Finance SIF as a knowledge partner for the Point Zero Forum 2023. In this Ecosystm Insights, our guest author Jaskaran Bhalla, Content Lead, Elevandi talks about the Point Zero Forum 2023 and how it is all set to explore digital assets, sustainability, and AI in an ever-evolving Financial Services landscape.
The Point Zero Forum is returning for its second edition between 26 to 28 June 2023 in Zurich, Switzerland. The inaugural Forum held in June 2022 attracted over 1,000 leaders and featured more than 200 esteemed speakers from Europe, Asia Pacific, the USA, and MENA. The Forum represents a collaboration between the Swiss State Secretariat for International Finance (SIF) and Elevandi and is organised in cooperation with the BIS Innovation Hub, the Monetary Authority of Singapore (MAS), and the Swiss National Bank.
As we gear up for this year’s Point Zero Forum, let’s take a moment to reflect on some of the pivotal developments that have shaped the Financial Services industry since the previous Forum and also moulded the three key themes that will take centre stage this year: Sustainability, Artificial Intelligence (AI), and Digital Assets.
COP27, the rise of blended finance and the groundbreaking Net-Zero Public Data Utility
In November 2022, the Government of the Arab Republic of Egypt hosted the 27th session of the Conference of the Parties of the UNFCCC (COP27), with a view to accelerate the transition to a low-carbon future. In the build-up to COP27, Ravi Menon, the Managing Director of the MAS spoke at the inaugural Transition Finance towards Net-Zero conference and shared with the audience that the world is currently not on a trajectory to achieve net-zero emissions by 2050. And according to the UN Emissions Gap report 2021, based on the current policies in place, the world is 55% short of the emissions reduction target for 2030. He also elaborated on the significant role that blended finance can play in tackling climate change, a theme that widely resonated with the global leaders at COP27. To enable easy and transparent reporting on climate commitments, the Climate Data Steering Committee (CDSC) outlined the next steps on its recommended plans for the Net-Zero Data Public Utility (NZDPU) at COP 27. NZDPU aims to aid efforts to transition to a net-zero economy by addressing data gaps, inconsistencies, and barriers to information that slow climate action.
The Point Zero Forum 2023 will deep-dive into the data, technologies, and capital and risk management solutions that can accelerate the fair transition towards a low-carbon future.
Panel Discussion Highlight: The opening panel discussion, “Data for Net-Zero: Views from the Climate Data Steering Committee,” scheduled for 26 June, will feature members of the CDSC, which include the Financial Conduct Authority, the MAS, Glasgow Financial Alliance for Net Zero (GFANZ), and the Swiss State Secretariat for International Finance. The panel will discuss the role of new technologies and collaborative platforms in promoting greater accessibility of transition data and innovative business models.
The launch of ChatGPT by OpenAI and its record for the fastest 100M monthly active users
The launch of ChatGPT by OpenAI on 30 November, 2022 led to widespread adoption by users globally – eventually setting the record for the fastest-growing, active users, hitting 100M monthly active users by Feb 2023. While on one hand users rushed to share enormous efficiency gains achieved by the use of ChatGPT, on the other hand ChatGPT soon became a disruptive tool to spread fake news.
The Point Zero Forum 2023 will deep-dive into Generative AI’s potential for enhancing efficiency, improving risk management, and providing better customer experience in the Financial Services industry, while highlighting the need for ensuring fair, ethical, accountable, and transparent use of these technologies.
Panel Discussion Highlight: The session “Breaking New Ground with Generative AI: Project MindForge”, scheduled for 27 June, will feature global leaders from NVIDIA, the MAS, Citigroup and Bloomberg. The panel will discuss the opportunities of Generative AI for the Financial Services sector.
MiCA regulation gets adopted by the EU lawmakers and sets a precedent for digital asset regulations
More than 2.5 years after it was first proposed, the EU Markets in Crypto-Assets (MiCA) regulation was approved in April 2023 by EU Parliament. While there is still work to be done to implement MiCA and measure its success, and to answer open questions around regulation for out-of-scope assets (like DeFI and NFTs), the digital assets industry is keenly observing whether MiCA could serve as a template for global crypto regulation. In May 2023, the International Organization Of Securities Commissions (IOSCO), the global standard setter for securities markets, also joined the global discussion on digital asset regulation by issuing for consultation detailed recommendations to jurisdictions across the globe as to how to regulate crypto assets.
The Point Zero Forum 2023 will do a stocktake on key global regulatory frameworks, market infrastructure, and use cases for the widespread adoption of digital assets, asset tokenisation, and distributed ledger technology.
Panel Discussion Highlight: The sessions “State of Global Digital Asset Regulation: Navigating Opportunities in an Evolving Landscape” and “Interoperability and Regulatory Compliance: Building the Future of Digital Asset Infrastructure”, scheduled on 26 and 27 June respectively, will feature global leaders from both public sector (such as the MAS, Bank of Italy, Bank of Thailand, U.S. Commodity Futures Trading Commission, EU Parliament) and private sector organisations (such as JP Morgan, Sygnum, SBI Digital Assets, Chainalysis, GBBC, SIX Digital Exchange). The discussions will centre around digital asset regulations and key considerations in the rapidly evolving world of digital assets.
Register here at https://www.pointzeroforum.com/registration. Receive 10% off the Industry Pass by entering the code ‘JB10’ at check out. (Policymakers, regulators, think tanks, and academics receive complimentary access/ Founders of tech companies (incorporated for less than 3 years) can apply for a discounted Founder’s Pass)
The recently concluded 27th Conference of the Parties to the United Nations Framework Convention on Climate Change (COP27) brought together Heads of State, ministers and negotiators, climate activists, mayors, civil society representatives, and CEOs in Egypt’s city of Sharm el-Sheikh to discuss climate action. The conference aimed to build on the outcomes of COP26 to effectively tackle the current climate emergency and set goals for the future.
Where COP26 Left Off
Before we look at COP27, here’s a look at what COP26 committed to and what the progress has been. The conference had ended on an ambitious note with a slew of climate plans and pledges undertaken by countries for the upcoming decades. In addition, all countries agreed to come back to COP27 with stronger, more focused climate plans of actions. The event saw 141 countries promise to halt and reverse forest loss and land degradation by 2030. As part of the Paris Agreement, 151 countries updated their nationally determined contributions (NDCs). Over 100 countries also signed the Global Methane Pledge to cut their collective methane emissions by 30% by 2030. The Glasgow Climate Pact was released at the end of COP26, which highlighted the need to phase out coal. During the conference, the Glasgow Financial Alliance for Net Zero (GFANZ) committed over USD 130 trillion in private capital towards achieving net-zero goals.
However, climate activists pointed out that there were some missed points:
- Ocean crisis was not addressed
- The progress on Climate Change Policy was hindered due to a lack of gender equality
- There was a lack of agreement on loss and damage finance from mature economies to emerging economies facing wide-scale destruction of life and property due to extreme weather events
- While many countries did set long-term goals, there was a lack of short-term targets for 2030
COP27 Continues to Pave the Path Ahead
Despite a lot of commitments being made during the previous conferences, not a lot of those targets were met. This year, one of the crucial focus points was the implementation of existing targets instead of setting new goals. The top themes at COP27 were climate finance, adaptation, loss and damage, and increased ambition.
Loss and Damage. In a first, ‘loss and damage’ was made a part of the provisional agenda of discussion on matters relating to finance. Smaller nations called for a treaty against fossil fuels, and a global tax on corporations’ profits from fossil fuels. Countries, including Austria, Germany, Belgium, and New Zealand, promised funds to emerging economies to help them with the loss and damage caused by activities undertaken by mature economies.
Adaptation. COP27 President Sameh Shoukry launched the Sharm El-Sheikh Adaptation Agenda, which outlines 30 adaptation outcomes that, if completed by 2030, will positively impact about four billion people in lesser developed areas in the world. UN secretary-general António Guterres also addressed the conference and suggested a universal early warning system for five years. In addition, the UN Human Rights and Right Here, Right Now launched the Human Rights Climate Commitments (HRCC) which is an initiative for rights-based climate action.
Accountability. Apart from this, discussions to highlight how greenwashing and weak net zero pledges are threatening to undermine global efforts were held. Global securities regulators called for a closer review of carbon trading to prevent greenwashing by companies to offset their emissions. This has led to a need for transparency and holding organisations accountable for net zero goals as well as establishing clear regulations and standards.
Other key areas of discussions focused on integrating renewable energy and bringing better energy solutions that cater to diverse countries and requirements and the Ukraine war and its impact on the Middle East and Africa. The COP27 agenda this year focused on various topics around finance, resilience, industry, land use, water, energy, and transport to create a sustainable planet.
Future Expectations
With several successful conferences behind us, the world wants more focused implementations and lesser conversations. Here are some of the future expectations:
- Emerging economies want to see ‘loss and damage’ a part of long-term climate agendas.
- As extreme weather conditions continue, concrete short-term plans to deal with the water and soil crisis are just as important as long-term ones.
- More collaborations are required between governments, corporates, investors, and society for new solutions and innovations.
- Corporates need to commit more to funding sustainable projects, invest in sustainable technology, and actually, reduce their carbon footprint.
- With today’s unpredictable times, policies need to be framed such that they can easily be amended and adapted to ensure that there is no pause or stop when implementing them.
The need of the hour is to address implementation blocks, facilitate conversations for funding and partnerships, and simple policies that are realistic – especially if 2030 and 2050 targets are to be met.