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COP28 Insights

December 14, 2023
By Debbie Howard & Kelly Boxall


“COP28 occurred at a decisive moment in the fight against climate change. It’s important that the outcome of the Global Stocktake clearly reaffirms the need for limiting global temperature rise to 1.5°C and that this requires drastic reductions in emissions this decade. For the first time, there is a recognition of the need to transition away from fossil fuels – after many years in which the discussion of this issue was blocked.”Antonio Guterres, Secretary General, United Nations

Hosted in Dubai, United Arab Emirates, the run up to COP28 was dominated by controversy chiefly centred around the influence of oil and gas at the negotiating table. In a conference dominated by the question of how to mitigate emissions from burning fossil fuels – the conflict of interest facing the host nation as an economy built on oil and gas – COP28 President Dr Sultan Al-Jaber and CEO of the Abu Dhabi National Oil Company (ADNOC) defined the tensions. But Al-Jaber has been resolute in his focus to deliver on ambitious, action-oriented outcomes aligning the 198 participating countries.

At the European Ministerial on Climate Action in July, Al-Jaber set out four pillars of focus for COP28:

  • Fast tracking the energy transition
  • Fixing climate finance
  • Focus on putting lives and livelihoods at the heart of the climate process
  • Full inclusivity

COP28 needed to deliver the first Global Stocktake, a five yearly assessment of how countries are doing against the Paris Agreement targets, in aggregate. Alignment on mitigation, adaptation and implementation support (financial, technology transfer and capacity building) then informs more ambitious Nationally Determined Contributions (NDCs), due in the next two years. Tensions on every aspect of how the world gets from being on a trajectory that is badly off track in achieving the goals of the Paris Agreement, to keeping 1.5°C within reach, pushed negotiations 24 hours beyond the original COP28 deadline. But the final agreement is historic and significant. It explicitly recognises, for the first time at COP, that the world needs to transition away from all fossil fuels towards cleaner energy and this shift must scale up urgently.

“We have delivered a comprehensive response to the Global Stocktake and all the other mandates. Together, we have confronted realities and we have set the world in the right direction. We have given it a robust action plan to keep 1.5 within reach. It is a plan that is led by the science. It is a balanced plan, that tackles emissions, bridges the gap on adaptation, reimagines global finance, and delivers on loss and damage. It is built on common ground. It is strengthened by inclusivity. And it is reinforced by collaboration.” Sultan Al-Jaber, COP President, UAE

COP28 brought a raft of declarations, initiatives, coalitions and partnerships. Below are some of the more notable, reflecting the COP Presidency agenda.


Fast Track the Energy Transition

The Global Decarbonisation Accelerator represents three steps taken at COP28 to help dramatically reduce the impact of emissions from the oil and gas sector.

The Global Renewables and Energy Efficiency Pledge, which agreed to triple worldwide installed renewable capacity to at least 11,000GW, and to double the average annual rate of energy efficiency improvements from around 2% to 4% every year until 2030.

The Oil and Gas Decarbonisation Charter signed by 50 companies representing 40% of global emissions, committed these businesses to completely reduce methane emissions by 2030 and reach net zero operations by 2050.

Focus on methane and other non-CO2 greenhouse gases reduction through economy-wide measures. In support of this, over $1bn was mobilized for methane abatement projects.


Fixing Climate Finance

A surprising early success of COP28, the establishment of a Loss and Damage Fund – agreed in principle at COP27 and painstakingly worked through since – was announced at the opening plenary. Operationalising arrangements and initial contributions to pay for serious and sometimes irreversible impacts around the world, where vulnerable communities are already experiencing loss of life, damage to property and cropland, resulted in contributions committed from UAE, UK, U.S., Ireland, Germany, Denmark, the Netherlands, Japan, Canada, Italy, Estonia and Spain totalling just over $700m. A significant step, but far short of what climate vulnerable developing countries need for climate reparations.

Unleashing the required finance to implement decarbonisation at the scale needed is the next big challenge. Currently, climate financing is fragmented, difficult to unlock and undermined by fossil fuel subsidies. Private finance has a significant part to play. The UAE announced a $30bn contribution to Alterra, a new climate-focused fund established with launch partners, Blackrock, Brookfield and TPG. The fund aims to become the largest climate specific fund ever created, with a target of $250bn of contributions by 2030. Dr. Al-Jaber will chair the board of the fund which the UAE hopes will create a multiplier effect in climate investment, particularly in the Global South.

Climate finance will now be the big focus leading up to COP29. Unlocking the trillions of dollars for investment in zero emission and climate resilient development and growth, particularly in developing countries, is needed to accelerate the transition to decarbonised economies.


Focus on Putting Lives and Livelihoods at the Heart of the Climate Process

In a first for COP, food and agriculture had a dedicated day on the thematic agenda. Endorsed by 158 countries, the Declaration on Sustainable Agriculture, Resilient Food Systems and Climate Action recognised that unprecedented adverse climate impacts are increasingly threatening the resilience of agriculture and food systems as well as the ability of many, especially the most vulnerable, to produce and access food in the face of mounting hunger, malnutrition and economic stresses. Supporters stressed that any path to fully achieving the long-term goals of the Paris Agreement must include agriculture and food systems, while affirming that agriculture and food systems must urgently adapt and transform in order to respond to the imperatives of climate change.

Further, the UN Food and Agriculture Organization (FAO) published its roadmap for food systems. The roadmap will be laid out over the next two to three years, starting with 20 key targets including reducing methane emissions from livestock by 25% by 2030, ensuring all the world’s fisheries are sustainably managed by 2030, and halving food waste by 2030. Future iterations of the plan will also examine measures to tax sugar, salt and processed foods and better food labelling.

Health marked its inaugural day with the first Declaration on Climate and Health, endorsed by 143 countries. Recognising the negative impacts of climate change on health and the health benefits of taking urgent action, commitments were made to the advancement of climate-resilient development, the strengthening of health systems, and the building of resilient and thriving communities, for the benefit of present and future generations.


Full Inclusivity

COP28 set out to make inclusivity its hallmark and “address the needs of the Global South,” including the utilisation of finance to support the transition to green technologies. The scale of this year’s operation has certainly cast the net wider in terms of voices in attendance, with approximately 100,000 country negotiators, representatives from business and activists in attendance – nearly three times as many as COP26 in Glasgow and double the scale of COP27 in Egypt. Yet while some of the outcomes go some way to addressing concerns of developing nations and the Global South, some smaller states most threatened by climate change remain disappointed in the final language on fossil fuels, where they – as part of a reported group of 127 countries – were pushing for more definitive “phase out” language.


What COP28 Means for Business

Announcements including the Alterra Fund, Global Decarbonisation Accelerator and multiple green start up programmes underlined the scale of partnership between businesses, governments and other third parties at COP28. While there has been much scrutiny over the role of corporates at the conference, the participation of business demonstrated the role they must play in delivering against conference outcomes and the need to act in partnership. The contribution of corporates to the COP process should not be underestimated. While governments have negotiated the direction to keep 1.5°C in reach, it will ultimately fall to partnerships with the private sector to implement the plan and ensure targets are met.

As pressure mounts on businesses to navigate a clear path towards achieving climate, nature and social targets, there are some key challenges facing businesses and their sustainability leaders.

1: Elections across the West, including in the U.S. and UK in 2024 will likely see businesses operating in a more polarised environment. While the global issue of climate is becoming increasingly hijacked by political parties, the more local and personal issues of jobs, air pollution, economic growth and health benefits provide easier platforms for engagement.

2: While speaking out publicly has become increasingly fraught with challenge, this doesn’t mean the voices of business should be silenced. By influencing for change behind the scenes – via events, through the creation and activation of coalitions and direct to stakeholder engagement – momentum can be built.

3: COP does provide a unique opportunity to build industry and cross-industry international coalitions. Sectoral solidarity can help build momentum, set a direction and create a platform to influence government policies.

4: The capital needed to shift away from fossil fuel reliance towards cleaner and more regenerative practices is significant. But the COP28 outcome signals the beginning of the end of fossil fuels and assets that rely on them long term will lose value. Businesses can focus on what they do best: Innovation and creativity to find more sustainable ways of meeting customer needs. Making products and building value chains that are future proof and using marketing capabilities to shift people towards sustainable lifestyles on a mass scale, will reap rewards.


Looking to 2024

All eyes now turn to Baku, Azerbaijan, in 2024. COP28 has delivered a step in the right direction by recognising the need to transition away from fossil fuels. The big question for next year will be how to mobilise climate finance in a way that primarily and sustainably supports a worldwide, urgent and scaled shift towards decarbonisation this decade.

Beyond, COP30 will be held in Belém, Brazil, known as the gateway to the Amazon, where countries will need to present new, ramped up Nationally Determined Contributions (NDCs).


The views and opinions in these articles are solely of the authors and do not necessarily reflect those of Teneo. They are offered to stimulate thought and discussion and not as legal, financial, accounting, tax or other professional advice or counsel.

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