Garraway’s guide to the business of COP28

COP28 day twelve, 13th December

It’s all over. The gavel came down on the final deal early this afternoon, concluding COP28 and beginning the handover process to the incoming Azerbaijani COP29 Presidency team. Exactly what the outcomes of what COP28 means for business will be the focus of discussion at our webinar, on Tuesday 19^th December – sign up to join us .

So, where have we landed? A lot has been said on both sides of the aisle as to whether the COP28 text is a good or bad deal. In reality, it’s both. In fact, it’s a wonder we even have a deal at all given how far apart Parties are on some of the key issues in the text. Making history, this is the first global climate agreement that mentions fossil fuels – a shocking fact in itself, given we’ve known for decades the key responsibility they hold for causing climate change. That an agreement which requires, albeit it in hushed tones, countries to ‘transition away’ from fossil fuels could be established with the likes of Saudi Arabia in the room demonstrates the strength of pushback that has taken place against the wishes of the fossil-fuel lobby. But we shouldn’t kid ourselves, the language is weak and full of loopholes.

The fact is that the climate process isn’t keeping up with the climate reality. Even the decision text’s mention of ‘1.1°C’ of warming, when we’re now seeing warming of 1.3°C, just shows the level of disconnect which needs bridging. All too often announcements are made but disappear into thin air once the media spotlight fades. However, when done well these ‘real world’ announcements can deliver meaningful change. The elevation of the Glasgow Leaders’ Declaration on Forest and Land Use from voluntary initiative into a globally-binding agreement is one shining example. Recognising the climate-nature nexus in the COP28 decision text, it demonstrates what can happen when countries and business commit to something – and follow up on their fine words with sustained pressure and action.

The COP President is wrong to state that the final text is a ‘true victory for those who are sincere in addressing climate change’, but it’s a start.

Thank you for taking the time to read Risilience’s COP28 blog. I’ve enjoyed writing it and hope you will join me and my guests at next week’s webinar for further analysis on what all this means for business in the year ahead.

Join the webinar: Key takeaways from COP28 and what they mean for business will be the focus of the Risilience expert-led webinar, COP28: navigating the regulatory landscape as a business in 2024, on Tuesday 19^th December at 9.30am. Register to hear from: Andy Garraway, Risilience Senior Climate Policy Analyst; Nigel Brook, Partner at global law firm Clyde & Co; Felicia Jackson, Editor at Sustainable Growth Voice; and Sarah Webster, Sustainable Business Director at Britvic.

COP28 day eleven, 12th December

It’s now 8pm in Dubai and the promised, revised draft of the text hasn’t yet appeared. That’s not surprising, given the gap that the Presidency is trying to bridge between the two sides on, primarily, the language of fossil fuels. Yesterday’s text went down like a lead balloon with pretty much every commentator and Party wishing to go on record. Those keeping quiet, such as Saudi Arabia, are quietly happy with their efforts to push back on phase- out language.

Behind closed doors, there are frenzied meetings between chief negotiators, the Presidency’s team and national ministers who are buckling up for the overrun. Well, except for the UK’s negotiations minister who, it was announced, had flown back home – he’s supposedly coming back tonight, just to really bump up that carbon footprint, around a third of the annual emissions of an average UK citizen, per the Guardian.

At this stage, all eyes are on the Presidency. What they propose in the next text has the potential to make or break the summit, with some commentators saying a collapse in the talks would at least get a debate going about the need to phase out fossil fuels. As much as the COP process and bureaucracy can be mindbogglingly opaque and increasingly captured by special interests, COP is the only forum we have as a planet to address climate change. Even more fundamentally, it is the only forum we have where the voices of those most vulnerable to the impacts of climate change are heard and heard loudly. We need a fossil fuel phase out, not a COP phase out.

We’ll be continuing our blog until the close of COP28, so stay tuned to find out what the next text has to say, when it finally drops.

COP28 day ten, 11th December

As I sit down to write today’s blog, there are just over 18 hours to go until the final gavel is scheduled to come down, marking the end of COP28. It also signals the countdown to COP29, in notable climate leader and not-at-all-autocratic-petrostate…*checks notes*…Azerbaijan.

After a weekend of saying all the right things, and repeatedly pressing Parties to accept the need for compromise without sacrificing ambition, the Presidency published its latest draft late on Monday afternoon. In what might prove to be a breakthrough on the thorny issue of what to do about fossil fuels, the Presidency has done away entirely with language on phase-outs and phase-downs, both equally contentious to opposing sides, in favour of language to reduce the production AND consumption of fossil fuels in line with the science.

Despite the text not explicitly providing a glidepath to follow, the IPCC outlines a very minor role for fossil fuels by 2050. This new text certainly won’t please everyone, nor should it – only a sustained global effort to phase-out fossil fuels will be sufficient to avoid the most catastrophic impacts of climate change – but it might just be enough to prevent COP28 failing to reach any sort of agreement.

Turning to the weekend’s events, the spotlight shone on the natural world in different guises: Saturday’s focus was nature, land use and oceans whilst Sunday focused on food, agriculture and water.

Agriculture, and associated land change, play a huge role in impacting nature and the environment but are also incredibly vulnerable to a changing climate. US Special Envoy for global food security Cary Fowler put it succinctly: ‘Agriculture will have significant problems at 1.5C… The worst years climatically for agriculture in the past will be the best years for agriculture in the future’.

Major food announcement number one: the UN’s Food and Agriculture Organisation (UN FAO) published the first instalment in its roadmap on reforming food and farming in order to keep within 1.5°C.

The UN FAO report highlighted the key role food production, and associated land use change, plays in impacting nature and the environment but also how vulnerable our food systems are to a changing climate. Further instalments of the roadmap will follow over the coming years at COP29 and COP30, designed to transform the targets outlined in the UN FAO’s first instalment into actionable, trackable steps. Some of those targets include reducing methane emissions by 25 per cent by 2030, halving food waste by 2030 and managing all the world’s fisheries in a sustainable manner by 2030.

Major food announcement number two: a number of ambitious countries and businesses came together to launch the Alliance of Champions for Food Systems Transformation (ACF), committing to strengthen national plans to transform the food industry consistent with science-based targets by 2025 at the latest.

Certain sectors of the food industry are increasingly coming under the spotlight: UN FAO research has shown the ‘dairy industry’s 3.4 per cent contribution to global human-induced emissions is a higher share than aviation’. Given the opprobrium we see directed at the aviation industry, it really highlights the importance of the whole food industry, in particular the meat and dairy industries, getting ahead of regulators and the public by cutting emissions and moving to nature-positive production processes. To quote former UK Food Tsar, Henry Dimbleby: ‘In the end, what you need is regulation’. Could the ACF be a sign of things to come for the food industry?

COP28 day seven, 8th December

As delegates trudge back to Expo City from their enforced Rest Day spent on the beach, indoor skiing or simply catching up on sleep, the scale of what’s still left to achieve in week two of COP28 is starting to dawn.

The focus in Dubai now shifts firmly towards the negotiations with ministers flying in to get down to business. They lend their weight to negotiators and handle the complex, political decisions on which the success of a COP rides. Ministerial pairings have been announced for some of the key issues remaining to be resolved and these ministerial double acts will spend the next few days touring round delegations seeking to identify where there might be common ground.

Interestingly, South Africa and Denmark will be taking the lead on trying to find a compromise agreement on the Global Stocktake GST) – Denmark being one of the two founders (along with Costa Rica) of the Beyond Oil & Gas Alliance of nations seeking to phase out fossil fuels. Is this the UAE stepping up to surprise everyone with a push for fossil fuel phase out, or is it making a play to deflect media attention? It’s anyone’s guess, but currently all text options on the GST use fossil fuel ‘phase out’ language, to varying degrees of absolute vs caveated, rather than ‘phase down’. That said, we should expect the voices of ‘phase out’ to be heard loudly throughout the next few days, with those of ‘phase down’ preferring to keep their powder dry until the closing moments when they can exert the most influence on the process (à la COP26’s coal phase-down moment).

The action in Dubai doesn’t stop over the weekend, so we’ll be covering the key outcomes from Nature, Land Use and Oceans Day, and Food, Agriculture and Water Day in Monday’s blog. Already, a number of major announcements have been trailed, not least the Asian Development Bank launching its $2bn nature solutions finance hub and the publication of new Taskforce on Nature-related Financial Disclosures draft sectoral guidance supporting eight priority sectors with high impacts and dependencies on nature.

COP28 day six, 7th December

Week one has come to a close but leaves much unfinished business to attend to. Despite an endless flurry of announcements and a breakthrough on Loss and Damage on day one, the week ahead poses a real challenge with so many key negotiating issues still unresolved.

To quote Dr Jennifer Allan, contributor to the Earth Negotiations Bulletin, progress on the negotiations so far is like watching ‘cartoon characters circling their legs but not going anywhere fast’.

It’s not looking good on adaptation. The work of the Adaptation Committee, so critical for those experiencing the impacts of climate change, failed to reach consensus and has been put on hold for COP28. The mood in the Global Goal on Adaptation discussions (think of this as an adaptation-focused counterpart to the temperature mitigation goal of keeping temperature rise to a maximum of 2°C or 1.5°C) is in a terrible place. At this point, there isn’t really a text to be sent to ministers and discussions have remained procedural rather than about the substance of the goal. There’s a potential knock-on impact here too; nothing exists in isolation at a COP and there is a placeholder in the Global Stocktake (GST) text for the Global Goal on Adaptation outcomes. If there’s nothing to include, some Parties may use that as justification to hold up the GST text.

Wherever discussions get to on the Global Goal on Adaptation, finance will be critical to achieving it. Glasgow saw a promise to double adaptation finance, but the trouble is there is no agreed definition of what constitutes adaptation finance. This means there’s no baseline from which to measure any increase, let alone a doubling, so discussions are ongoing here too.

In better news, despite a hugely difficult battle to come on the response to the Global Stocktake, not just what to say on adaptation, there are glimmers of hope. Current drafting language has landed on ‘phase out of unabated fossil fuels’ rather than phase down. That’s not to say this is where the decision text will land up, but at least the drafting marks a level of desired ambition that it was not certain the UAE would even aim for. As with adaptation finance, once Parties agree on language, the difficult task will be to define what the world has signed up for – that’s right, there’s no definition of what phase out, phase down or unabated mean.

It really is anyone’s guess at this point as to where the final text may end up by the closing plenary on Tuesday. If there are last minute hold-outs, we could well see COP28 overrun as has happened in previous years; COP27 closed 39 hours late, COP26 closed a day late and COP25 a whopping 44 hours late. Overruns are to be expected because dissenting voices can’t simply be voted down – there is no voting in a COP, so everything must be agreed through consensus. We could very well see similar scenes to those witnessed in Glasgow at COP26, where language on coal ‘phase out’ was amended to ‘phase down’ in the final hours to avoid a small number of Parties walking away from the talks.

COP28 day five, 6th December

We’re almost at the mid-way point in Dubai. Tomorrow brings the official Rest Day, so Thursday’s blog will provide reflection, drill more into the detail of the negotiations and take stock of progress so far. I will consider where the discussions could end up and whether COP might actually close on time. Hot take: don’t bet on it!

Today opened with the publication of a report warning that the Earth is on the verge of passing five major climate tipping points which will ‘severely damage our planet’s life-support systems and threaten the stability of our societies’. The Global Tipping Points project, led by the University of Exeter, reminds us of what is too often misunderstood – that climate change is not linear. A 0.1°C, temperature increase does not translate to 0.1°C of increased impacts. Tipping points can be irrevocably reached with zero-to-little chance of undoing the damage, regardless of what future hopes political leaders may wish to pin on unproven-at-scale technologies.

One announcement that didn’t get that much traction in the media, amidst the back-and-forth as to whether the man overseeing COP28 is a climate-science denier, is a much more positive one for business. Nearly 400 global organisations have committed to pushing for the adoption of the International Sustainability Board’s climate-related reporting standards. This groundswell of support behind the ISSB’s standards bodes well for efforts to implement a global reporting baseline. You can find more detail on what a business needs to know in our ISSB briefing paper.

On the negotiations side, draft texts have been emerging thick and fast onto the UNFCCC’s website, with some more definitive than others – you’ll immediately notice the use of square brackets denoting alternative text proposals and qualifiers. Draft language is to be expected at this point.

In theory, it should largely be the more political elements that remain unresolved but it looks like there’s a long way to go on a number of technical aspects of the texts. Further, today marks the point at which the technical aspect of the negotiations, known as the Subsidiary Bodies, closes, with authority for conducting the negotiations then passing to the Presidency to run for the final week. This changes the focus to the political aspects – such as fossil fuel phase-outs/-downs.

The mood in the negotiating rooms is uncertain; uncertain of where solutions are to be found given so much remains to be decided and uncertain of how the Presidency is intending to conduct the negotiations – and what that means for openness, transparency and inclusivity.

Negotiators will be grateful of the Rest Day but there won’t be much, if any, time off for those charged with reaching an agreement in time for the gavel to come down on Tuesday.

COP28 day four, 5th December

This morning’s publication of the 2023 update to the Global Carbon Budget provided the stark warning that we are still failing a key test, as global carbon emissions from fossil fuels continue to rise. A sobering reminder that, despite all the proclamations, promises and press releases, there’s a growing gap between rhetoric and action.

That said, if you were one of the fossil-fuel industry’s record number of lobbyists at this year’s COP – 2,456 to be precise, nearly four times more than any past year – you’d be pretty happy with that outcome.

But it’s not all bad news. Today’s Energy and Industry Day brought some big announcements worth highlighting for those companies looking to do the right thing, navigating the ever-changing regulatory landscape and trying to cut their emissions using evidence-driven data.

Several major organisations have come together to provide further guidance on how to most effectively undertake each stage of an organisation’s decarbonisation journey, including high-integrity carbon offsets. There are some significant players involved in this initiative, including CDP, GHG Protocol, the Science Based Targets Initiative, We Mean Business Coalition, VCMI and Integrity Council for the Voluntary Carbon Market. Given the institutions involved, we can expect this guidance, when published, to be well tailored for a business audience. At Risilience, we’re quite open about the challenges businesses face when using carbon offsets, so greater integrity, quality and transparency is to be welcomed.
The Taskforce on Net Zero Policy was launched to realise the recommendations of the (deep breath…) UN Secretary General’s High Level Expert Group on the Net-Zero Emissions Commitments of Non-State Entities, which were published at COP27, last year. Led by the Principles for Responsible Investment (PRI) alongside the UN Environment Programme Finance Initiative, United Nations Conference on Trade and Development (UNCTAD), the V20 Group, IFRS and others, this will look to support governments in adopting the recommendations and translating them into regulatory oversight of transition plans. Paying close attention to the recommendations, and in the UK to those of the Transition Plan Taskforce, is becoming increasingly important to ensure credibility in your decarbonisation plans.
And finally, sticking with the private sector but pivoting to its role in facilitating a just transition, the Energy Transition Accelerator (announced by John Kerry and the Rockefeller Foundation at COP27) unveiled its ETA Framework. The ETA aims to use high-integrity carbon credits to support the transition from fossil fuels to cleaner forms of power in developing and emerging economies by drawing in the billions in financing required. There are some pretty big-name companies already showing interest in participating, including Amazon, Mastercard and Schneider Electric, among others, ahead of the formal launch of the ETA.

Once the dust settles on COP, we can start to unpick the detail of these announcements and what they might mean in practice. But it’s clear that the winds are blowing in one direction – towards greater clarity, transparency, rigour and structure for businesses.

COP28 day three, 4th December

This weekend saw the conclusion of the World Climate Action Summit, where world leaders spend the first three days of COP28 announcing a string of pledges on finance, energy and other key themes.

Notably, over 110 nations have committed to tripling renewable energy capacity by 2030, although those on board may yet struggle to gain the wider support required to enshrine the pledge in the final text. Neither China nor India have confirmed they will back the policy, which would likely downgrade the commitment from global target to voluntary deal. A smaller number of countries have also launched a declaration to triple nuclear energy by 2050, injecting further clean fuel into the drive to phase-out fossils.

Whether nations can agree to phase-out fossil fuels is one of the most fiercely contested issues at COP28. The Glasgow Pact of COP26 saw this diluted to ‘phase down’ and, despite support from more than 100 countries, major detractors remain. The COP28 president, and, incidentally, CEO of the UAE’s state oil company, Sultan Al Jaber, spoke to the media on Monday morning to roll back on his inflammatory claim the day before that there’s “no science” to support a phase-out, saying he had been ‘misinterpreted’.

World leaders have now departed from Dubai, leaving the diplomats to roll their sleeves up in the many closed-door negotiating rooms and hash out the legal decisions, which will form the bones of the summit’s outcome. This process is notoriously hard to follow and is documented by an evolving set of legal texts in which the precise choice of words can inflame disagreement – the UN outlines a “crescendo” of words with ranging strengths of emotion. Draft agreements will continue to filter through the negotiation process in the coming days to be decided on in the closing plenary session by the presidency.

Monday also marks Finance Day at COP28 – where investors and bankers will join country representatives to consider how capital can be channelled towards green investments. This comes at a time when ESG investing has faced a significant backlash in the US, and make no mistake that financiers are unanimous on deploying their dollars towards climate action. Larry Fink, CEO of BlackRock, is among the most vocal on rearchitecting finance and has urged his peers to invest in the developing world.

Bloomberg and Glasgow Financial Alliance for Net Zero (GFANZ) has launched a Net-Zero Data Public Utility (NZDPU) proof of concept, which aims to provide a free-to-all platform to harmonise corporate climate data including GHG emissions and reduction targets. It currently holds a sample of CDP-sourced data but it’s anticipated that the platform will operate as the central repository for climate-related data, including disclosures under IFRS S2 and ESRS E1 requirements.

COP28 day two, 1st December

Here we go, the World Climate Action Summit (WCAS) is now in full swing with world leaders descending on Expo City Dubai to rub shoulders with CEOs. This two-day event is designed to inject some star power into proceedings and, ideally, send a signal that countries are taking climate change seriously. However, with a few key players missing, the substantive outcomes of the WCAS remain to be seen.

Although President Biden and President Xi won’t be attending, the announcement during Xi’s visit to California last month, that the US and China will work more closely together on climate issues, will provide a much-needed boost to some difficult diplomacy needing to take place over the next fortnight. A similar joint declaration in the early days of COP26 helped lift spirits, showing the world’s two major economies would put their differences aside to focus on the most critical issue of our generation.

It won’t be easy. In his opening remarks, yesterday, COP President Sultan Al Jaber noted some of the challenges to come, not least discussions on the Global Stocktake and on the role fossil fuels will play over the coming years.

But COP28 has ignited with two big achievements on day one: discussions to agree the negotiating agenda have avoided the protracted fight we saw in Bonn this summer; and an unexpectedly immediate agreement on a Loss and Damage Fund – name to be decided. The fund has been years in the making and will support those nations most vulnerable to climate-related disasters.

This meant day one closed on an optimistic tone. Credit for a strong start should be given to the Presidency for the amount of clearly-effective shuttle diplomacy undertaken by the COP President in the last few months, those BBC allegations notwithstanding…

Friday brings a carousel of speeches from world leaders who will state their ambitions for COP28, and promise new climate actions and cash. A rousing address from King Charles III set the tone for the day, saying “the Earth does not belong to us”. Speeches from Brazil’s Lula, India’s Modi, Kenya’s Ruto, and others throughout the day will emphasise the disproportionate impacts of climate change and ensure the global south is central to the agenda in Dubai.

This morning, the Presidency has also announced a keystone declaration on the future of the global food system, appetisingly named the ‘Emirates Declaration on Sustainable Agriculture, Resilient Food Systems, and Climate Action’. This is the first ever global pledge on food, which accounts for about one-third of all greenhouse gas emissions. Major producers and consumers including the US, Brazil and China have signed up.

However, this declaration contains no legally binding commitments, such as measures to control overconsumption, food waste and intensive agricultural practices. It is encouraging to see food on the main menu at COP28 but we hope to see this intent backed up with specific and measurable targets in the coming weeks. Industries with agricultural supply chains can hope that this commitment will incentivise more sustainable farming and food habits, reduce agricultural emissions and build resilience to supply chain shocks.

COP28 day one, 30^th November

COP28 opens today and the eyes of the world’s climate community will be on Dubai for the next fortnight. There will be a lot of noise emerging from Expo City Dubai and it can be hard to discern what’s genuinely significant. Risilience will be running a daily Monday-to-Friday blog, straddling both the United Nations Framework Convention on Climate Change (UNFCC) negotiations and the Presidency-led thematic events to provide insights into what the events of COP28 mean for business.

To kick things off, here’s a sense of what you can expect from the next two weeks.

Week one

Think of COP as two tracks running parallel to each other: one, the formal UNFCCC negotiations process and, the other, the Presidency-led agenda, focusing on its priorities.

In week one negotiators will spend long days drilling down into the technical details of the 170-plus items due for discussion at this summit. That is, if agreement can be reached on adopting the formal agenda of the talks – no easy feat, as we saw in Bonn this summer. The United Arab Emirates (UAE) Presidency’s role is to manage the competing priorities of different countries and negotiating groups, to keep disagreement to a minimum and forge progress towards an agreement. The bones of that agreement will start to emerge in week two and provide the measure, against which, the success of COP28 is defined.

Week one will begin with a scene-stealing World Climate Action Summit, a world leader-level opening plenary designed to inject a sense of urgency and political support to the fight against climate change. Alongside the CEO-level Business and Philanthropy Climate Forum, COP28’s multi-stakeholder engagement platform for the private sector dedicated to driving cross-sectoral progress towards net zero and nature-positive goals, we can expect to see a series of voluntary pledges emerge from the various thematic days taking place over the course of the conference. While these can often be bold statements of action which fall at the first hurdle, sometimes they can mark the firing gun towards regulatory change – as we saw with the launch of the International Sustainability Standards Board at COP26.

Week two

The second week heralds a shift from the technical phase of the negotiations towards a more overt political phase, with the Presidency taking over responsibility from the UNFCCC for running the negotiations. It remains to be seen how UAE will operate as a Presidency, and by extension when we start to see the drafts of an agreement emerge. The UK opted for a transparent approach at COP26, publishing a number of drafts of the final cover decision from an early stage to secure buy-in, whereas Egypt kept its cards close to its chest until the concluding stages of COP27.

The business brief

Although it’s almost impossible to say where COP28 will land, we do know what the key flashpoint issues will be: loss and damage, fossil fuel phase-outs/phase-downs and the first Global Stocktake (GST) that reports on the progress of the 200 countries that agreed to limit global warming under the 2015 Paris Agreement. For business, the GST is the one to watch. When it was published earlier this year, the GST confirmed what we all knew – that we were nowhere near on track to keep warming to 2°C let alone 1.5°C. The response to the findings at COP28 will be key to understanding where countries will look to expand their climate ambitions (read: policies) in coming years. And crucially, that mid-century, net-zero target has the potential to edge closer, if the UN Secretary General Antonio Guterres’ calls in response to the GST are heeded.

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Garraway's guide to the business of COP28