By Ira Srivastava
1. COP28 wraps up in Dubai. Last week, the UN climate change conference ended and a global stocktake was published. This stocktake calls for the phase-down of fossil fuels, boosting renewable energy capacity and energy efficiency, and ending subsidies for the oil and gas industry. Climate financing was a key issue at COP28, as a number of funds intended to help developing countries transition away from fossil fuels were announced or replenished. This includes the Green Climate Fund, Least Developed Countries Fund, Special Climate Change Fund, and Adaptation Fund. Despite this, environmentalists and scientists argued that this agreement still falls short as it calls for a phase down rather than a phase out of fossil fuels.
2. TNFD publishes sector-specific recommendations. The Taskforce on Nature-related Financial Disclosures published its final draft earlier this year, and has now released industry-specific guidance. The focus industries are oil and gas, metals and mining, forestry and paper, food and agriculture, utilities and power generation, chemicals, biotechnology and pharmaceuticals, aquaculture, and financial institutions. These industries are the primary drivers of biodiversity loss and nature degradation, so board members and business leaders in these sectors would do well to study the relevant drafts. They are open for comment until March 2024, after which the final recommendations will be published. The full drafts for each industry can be found by following the hyperlinks above.
3. The importance of collective stakeholder action in carbon markets. Cooperation between countries, the private sectors, Indigenous communities, and community-level organisations is the core aspect of Article 6 of the 2015 Paris Agreement. Diverse stakeholders working together to develop a carbon market is vital for achieving Article 6. Cooperation can foster ties between developing and developed countries who are looking to offset their carbon emissions. Industries in low-emission countries will benefit from the capital that a carbon market will bring, while companies in developed countries can use it to achieve their emissions targets. Governments and private industries also need to work together as blended financing reduces the risk of carbon credits. Read the full report here.
4. Code of conduct launched for ESG ratings organisations. ESG ratings can be a useful tool for investors and organisations, but they are also known for unclear methodologies and conflicting information. To manage this and avoid greenwashing, the International Capital Market Association created a voluntary code of conduct that ratings organisations can follow. This new code will also address criticisms of ratings agencies including a lack of universal standardisation and transparency issues. The International Organization of Securities Commissions has come out in favour of the new code of conduct.
5. China’s new air pollution regulations. Poor air quality is a problem that Chinese cities have been grappling with for years now. The Chinese government has announced an action plan to minimise air pollution from manufacturing and industry. The plan includes a moratorium on new steel plants, targeting key high polluting industries, and a focus on renewable energy and green industries. China also has a national target of 20% renewable energy supply by 2025, and 80% of new public and private vehicles being electric. Despite China’s reputation as being a large polluter, the country has been a pioneer in renewable energy investment and its per capita carbon emissions are significantly lower than those of the United States and Canada.
Ira Srivastava is Competent Boards’ Program Coordinator. Follow Competent Boards on LinkedIn.