The 28th United Nations Climate Change Conference (or COP28) took place at the end of 2023 in one of the most climate-vulnerable countries in the world – the UAE. The event brought together nations, leaders, and climate experts to unite around tangible climate action and deliver realistic solutions.
COP28 marked a watershed moment in the global effort to fight climate change because it concluded the first Global Stocktake – a routine assessment of progress under the Paris Agreement that occurs every five years. It is clear that we are not on track to meet the agreement’s goals, but the decisions and actions taken during COP28 can redefine the trajectory of climate action.
COP27: Laying the Foundation
COP27 laid the groundwork for this year’s conference. The summit focused on mitigation, adaptation, finance, and collaboration. The key outcomes of COP27 included the creation of the loss and damage fund, new pledges to the Adaptation Fund, and advancements in the Santiago Network focused on technical support for climate-affected regions. The conference also saw progress on the Global Stocktake and formal recognition of new issues such as water, food security, and forests within climate deliberations.
However, there was widespread criticism for failing to live up to the urgency of impending climate crisis. Despite being called the “implementation COP”, nothing decisive was done to ensure global warming is limited to 1.5 degrees celsius.
COP28: Milestones
Launching the first-ever Global Stocktake. The Global Stocktake was the spotlight of this year’s event and covered various climate issues, including energy, transport, and nature. Despite strong opposition from Oil & Gas interests, negotiators secured an agreement indicating the start of the end of the fossil fuel era – a much-needed conclusion to the hottest year in history. The next global assessment of Paris Agreement targets is expected to take place at COP33 in 2028.
Supporting sustainable agriculture. A landmark declaration on sustainable agriculture was adopted to address climate-related threats to global food systems. Signed by 160 countries, the declaration pledged a collective commitment by participating nations to expedite the integration of agriculture and food systems into national climate actions by 2025. For the first time ever, the summit also featured an entire day devoted to food and agriculture and saw a food systems roadmap laid out by the Food and Agriculture Organisation (FAO).
Operationalising the “Loss and Damage” fund. The conference saw the approval of the “loss and damage fund” that was first tabled at COP27 last year. The fund has been a long-requested support for developing nations facing the impact of climate change.
Tripling renewables and doubling energy efficiency by 2030. 118 countries signed a renewable energy pledge to triple the world’s green energy capacity to 11,000 GW by 2030, reducing the reliance on fossil fuels in generating energy. The pledge is expected to see global average annual rate of energy efficiency improvements from around 2% to over 4% every year until 2030. While the pledge spearheaded by the EU, the US, and the UAE is not legally binding, it is a step in the right direction.
Adapting to a warmer world. COP28 provided a framework for the ‘Global Goal on Adaptation’ to guide countries in their efforts to protect their people and ecosystems from climate change. An explicit 2030 date has been integrated into the text for targets on water security, ecosystem restoration, health, climate-resilient food systems, resilient human settlements, reduction of poverty, and protection of tangible cultural heritage.
Addressing methane. Methane took centre stage at COP28, reflecting its significant role in current global warming. US, Canada, Brazil, and Egypt announced more than USD 1 billion in funding to reduce methane emissions. Despite facing political challenges, these measures signify a shift towards concrete regulatory and pricing tools, marking a step forward in addressing methane’s impact on climate protection.
How COP28 Could Have Been More Impactful
Better funding allocations. Although the “loss and damage” funding agreement seems like a major outcome, the actual financial commitments fell far short. US and China, despite being the world’s largest emitters, extended only USD 17.5 million and USD 10 million to the fund, respectively. There is also debate about how funds should be distributed, with mature countries favouring aid allocation based on vulnerability. This approach might exclude middle-income countries that have suffered significant climate-related damage recently.
More focus on AI. While COP28 tackled critical climate issues, it overlooked a significant concern – the environmental impact of AI. While AI holds promise for improved sustainability, it is important to address the environmental consequences of AI model training and deployment. The absence of scrutiny on the ecological impact of AI represents a missed early opportunity, considering the widespread hype and significant investments in the technology.
Recognising climate refugees. The increase in climate-related displacement is a growing concern, with millions already affected and predictions of a significant rise by 2050. International law does not recognise those displaced by climate events as refugees. Despite this, the topic wasn’t adequately explored at COP28, highlighting the need for inclusive discussions and solutions for safe migration pathways.
A Call for Unified Action
While COP28 and similar forums highlight the severity of the climate crisis, the real power lies in continuous collective conversations that identify gaps, strive to bridge them, and drive meaningful change. Ecosystm, in collaboration with partners Kyndryl and Microsoft, conducted a Global Sustainability Barometer study, that reveals that while 85% of global organisations acknowledge the strategic importance of sustainability goals, only 16% have successfully integrated sustainability into their corporate and transformation strategies with tangible data.
While governments and policy makers continue to focus on building a sustainable future for the planet, this is time for a shift in mindset and action is pivotal for a unified global effort in addressing climate challenges and building a sustainable future – from organisations and individuals alike.
2023 has been an eventful year. In May, the WHO announced that the pandemic was no longer a global public health emergency. However, other influencers in 2023 will continue to impact the market, well into 2024 and beyond.
Global Conflicts. The Russian invasion of Ukraine persisted; the Israeli-Palestinian conflict escalated into war; African nations continued to see armed conflicts and political crises; there has been significant population displacement.
Banking Crisis. American regional banks collapsed – Silicon Valley Bank and First Republic Bank collapses ranking as the third and second-largest banking collapses in US history; Credit Suisse was acquired by UBS in Switzerland.
Climate Emergency. The UN’s synthesis report found that there’s still a chance to limit global temperature increases by 1.5°C; Loss and Damage conversations continued without a significant impact.
Power of AI. The interest in generative AI models heated up; tech vendors incorporated foundational models in their enterprise offerings – Microsoft Copilot was launched; awareness of AI risks strengthened calls for Ethical/Responsible AI.
Click below to find out what Ecosystm analysts Achim Granzen, Darian Bird, Peter Carr, Sash Mukherjee and Tim Sheedy consider the top 5 tech market forces that will impact organisations in 2024.
Click here to download ‘Ecosystm Predicts: Tech Market Dynamics 2024’ as a PDF
#1 State-sponsored Attacks Will Alter the Nature Of Security Threats
It is becoming clearer that the post-Cold-War era is over, and we are transitioning to a multi-polar world. In this new age, malevolent governments will become increasingly emboldened to carry out cyber and physical attacks without the concern of sanction.
Unlike most malicious actors driven by profit today, state adversaries will be motivated to maximise disruption.
Rather than encrypting valuable data with ransomware, wiper malware will be deployed. State-sponsored attacks against critical infrastructure, such as transportation, energy, and undersea cables will be designed to inflict irreversible damage. The recent 23andme breach is an example of how ethnically directed attacks could be designed to sow fear and distrust. Additionally, even the threat of spyware and phishing will cause some activists, journalists, and politicians to self-censor.
#2 AI Legislation Breaches Will Occur, But Will Go Unpunished
With US President Biden’s recently published “Executive order on Safe, Secure and Trustworthy AI” and the European Union’s “AI Act” set for adoption by the European Parliament in mid-2024, codified and enforceable AI legislation is on the verge of becoming reality. However, oversight structures with powers to enforce the rules are currently not in place for either initiative and will take time to build out.
In 2024, the first instances of AI legislation violations will surface – potentially revealed by whistleblowers or significant public AI failures – but no legal action will be taken yet.
#3 AI Will Increase Net-New Carbon Emissions
In an age focused on reducing carbon and greenhouse gas emissions, AI is contributing to the opposite. Organisations often fail to track these emissions under the broader “Scope 3” category. Researchers at the University of Massachusetts, Amherst, found that training a single AI model can emit over 283T of carbon dioxide, equal to emissions from 62.6 gasoline-powered vehicles in a year.
Organisations rely on cloud providers for carbon emission reduction (Amazon targets net-zero by 2040, and Microsoft and Google aim for 2030, with the trajectory influencing global climate change); yet transparency on AI greenhouse gas emissions is limited. Diverse routes to net-zero will determine the level of greenhouse gas emissions.
Some argue that AI can help in better mapping a path to net-zero, but there is concern about whether the damage caused in the process will outweigh the benefits.
#4 ESG Will Transform into GSE to Become the Future of GRC
Previously viewed as a standalone concept, ESG will be increasingly recognised as integral to Governance, Risk, and Compliance (GRC) practices. The ‘E’ in ESG, representing environmental concerns, is becoming synonymous with compliance due to growing environmental regulations. The ‘S’, or social aspect, is merging with risk management, addressing contemporary issues such as ethical supply chains, workplace equity, and modern slavery, which traditional GRC models often overlook. Governance continues to be a crucial component.
The key to organisational adoption and transformation will be understanding that ESG is not an isolated function but is intricately linked with existing GRC capabilities.
This will present opportunities for GRC and Risk Management providers to adapt their current solutions, already deployed within organisations, to enhance ESG effectiveness. This strategy promises mutual benefits, improving compliance and risk management while simultaneously advancing ESG initiatives.
#5 Productivity Will Dominate Workforce Conversations
The skills discussions have shifted significantly over 2023. At the start of the year, HR leaders were still dealing with the ‘productivity conundrum’ – balancing employee flexibility and productivity in a hybrid work setting. There were also concerns about skills shortage, particularly in IT, as organisations prioritised tech-driven transformation and innovation.
Now, the focus is on assessing the pros and cons (mainly ROI) of providing employees with advanced productivity tools. For example, early studies on Microsoft Copilot showed that 70% of users experienced increased productivity. Discussions, including Narayana Murthy’s remarks on 70-hour work weeks, have re-ignited conversations about employee well-being and the impact of technology in enabling employees to achieve more in less time.
Against the backdrop of skills shortages and the need for better employee experience to retain talent, organisations are increasingly adopting/upgrading their productivity tools – starting with their Sales & Marketing functions.
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.
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.