Goal 13 Impact Platform - Keynote from HE Ken O'Flaherty
We have just concluded the launch of Goal 13 Impact Platform (https://www.cgmalaysia.com/post/goal-13-impact-platform)
This keynote was presented by HE Ken O'Flaherty, COP26 Regional Ambassador to Asia Pacific and South Asia, during the webinar - "Goal 13 Impact Platform". Read the recap and watch the recording here. The panelists have addressed the questions raised during the webinar and it's available at the bottom of this post.
2021 will be a critical year for our planet - for demonstrating we are accelerating progress towards our long term goals of keeping global mean temperature rises well below 2℃ and to strive to limit the rise to 1.5℃.
This November (1-12) the UK will host the vital UN climate conference, COP26, where the world will meet to agree on more ambitious action.
We recognise the severe consequences and unprecedented challenges all countries, businesses and people are facing in responding to COVID-19.
We must collectively support a green, resilient and inclusive recovery that helps us deliver our existing commitments. COP26 can be the moment when the world comes together to ramp up momentum towards a climate resilient zero carbon economy.
COP26 will bring together over 30,000 delegates in Glasgow. We need countries, cities, regions, states, investors and businesses to move onto a credible path to net zero.
The UK is seeking to galvanise ambitious climate action through five action areas:
○ Embracing the large clean growth opportunities of the energy transition by accelerating the transition from coal to green energy.
○ Driving clean transport by speeding up the phase out of petrol and diesel engine vehicles from the roads over the next generation and supporting zero emission vehicle innovations.
○ Bringing about a green transformation of the financial system. This must give all countries access to the investment they need to fund projects designed to boost their resilience and power their shift to clean growth.
○ Protecting and restoring natural habitats and ecosystems through nature based solutions on an unprecedented scale. This is vital in safeguarding our climate, air, water and way of life for future generations.
○ Adaptation and resilience through helping communities prepare better for the impact of climate change. We need to make a step change in adaptation and resilience investment, insurance and expertise - particularly in developing countries.
Asia is crucial to progress across these agendas, not least given its driving role in the world economy. This is notably relevant to the energy transition agenda – if the plans for new coal reactors across the region are implemented then we will not meet our global Paris targets to limit global warming to 1.5 degrees. The destruction of rainforests in many Asian countries drives global warming and pollution, with severe impacts on local populations. And countries across Asia are already suffering from the impacts of climate change, with extreme weather events growing in frequency and causing devastation for regional economies. One third of Bangladesh was underwater last year due to extensive flooding.
Asia is now responding to this challenge. China made a historic announcement in September last year that it would reach Net Zero emissions by 2060. This was swiftly followed by announcements by Japan and South Korea that they would reach Net Zero by 2050. We have seen further Net Zero announcements by Laos, Nepal and the Maldives in recent weeks, and we hope to see further commitments across Asia in the months ahead – including, I hope, here in Malaysia.
Asia is also embracing the clean energy agenda. Vietnam is emerging as a new solar and wind superpower. Pakistan and the Philippines have announced a moratorium on new coal plants, , and countries across Asia are cancelling coal plans and investing in renewable energy. I was pleased to hear that Malaysia is considering a new energy policy with no new coal power from 2021. This has the potential to drive growth and jobs in the years to come.
We are clear that business has a key role in supporting and accelerating this progress. We know that many businesses are currently focussing on their COVID response. But we must maximise opportunities to recover better and put credible climate action at the heart of recovery. And we know that businesses face increasing calls from their clients, shareholders and indeed their own employees to play their part in limiting global warming to 1.5 degrees.
For the UK, business action remains vitally important to achieving a successful COP26 summit and presidency. Many companies around the world are already stepping up. We want all companies to build on this.
We call on companies to show increased ambition. Businesses should set ambitious net zero commitments by 2050 or earlier, with credible short term action plans to achieve this, such as Science Based Targets. Businesses should join the Race to Zero through one of the partner initiatives - ideally the Business Ambition for 1.5C pledge. You would be in exclusive company if you joined, joining the likes of Sarawak Energy Berhad (energy utility) and Tai Wah Garment Industry Sdn. Bhd (textiles).
[If you are a SME you can also join the Race to Zero through the SME Climate Hub where you can access support to help you reach net zero.]
Companies can also play an important advocacy role. You can help set out a positive vision for change with all partners, especially supply chains and peers within your sector. We ask you to support enhanced ambition from national governments, underlining the importance of a green and resilient recovery, from. Over 500 international businesses have already expressed their support publicly. Here in Asia, we have seen the impact that the voice of business can provide – for example in Cambodia where international garment importers sent a joint letter to the government stressing the importance for them of access to renewable energy.
Corporate governance and finance is also essential. We need to deliver financial support for global public commitments - demonstrating that developed countries are fulfilling their commitment to mobilise $100bn in climate finance for mitigation and adaptation for developing countries annually by 2020.
We want to use the opportunity of COP26 to visibly move finance into low-carbon and resilient investment that maximises overall environmental benefits, demonstrating to developing countries that finance will flow to sustainably support their economic growth.
We also need to dramatically improve global business reporting on climate risk. Investors need to understand how extreme weather events (i.e. physical risks) and the move to net zero (i.e. transition risks) affect business models and the associated financial impact. This requires an improvement in the quantity, quality and comparability of information that companies disclose around climate-related risks and opportunities. The Task Force on Climate-related Financial Disclosures (TCFD) has become the go-to standard for such climate-related financial reporting.
A company’s disclosures need not only to cover what their emissions are today but also what their plans are for their emissions tomorrow and the associated financial impact. That means assessing the resilience of companies’ (particularly large banks and insurers) strategies to a move to net zero.
Investors and lenders need a way to identify which companies are on a credible path to transition to net zero (and therefore less exposed to climate risk). This means understanding what constitutes a “credible” transition plan; how it is governed (e.g. is compensation tied to success in achieving the plan?); and what are the short-term milestones to achieving the plan.
The action of companies is also directly relevant to our other COP26 campaigns beyond finance. On the energy transition, renewables are now cheaper than fossil fuels in over 2/3 of countries worldwide, including in Asia – and this trend will continue. Within a few years it will be cheaper to build new renewables than to run existing coal plants. Coal is therefore a doomed industry, and new coal plants being built now are destined to become stranded assets in the future. But we need to deliver investment today in renewables to avoid countries facing such burdens for decades to come.
We encourage businesses to join the Powering Past Coal Alliance (PPCA) and commit to either: (1) powering operations without coal; (2) restricting the financing of unabated coal power generation. Investors should increase investment in decarbonised power, by, for example, joining the UNPRI Net Zero Asset Owners Alliance, Climate Action 100+. We encourage you to commit to increased use of renewable energy by joining the RE100 initiative. You would be in good company if your company became a RE100 member, joining the likes of AEON retail and LONGi which makes solar PV products in Malaysia's Kuching state. And businesses can raise internal ambition, advocating for increased product efficiency for high-energy products such as motors, refrigerators, air conditioners and lighting.
Businesses can also support the global transition to clean transport. We call on all businesses with large fleets to commit to the uptake of electric vehicles into your corporate fleet, invest in the installation of charging infrastructure, and place requirements in service contracts for EV usage by 2030 - including through joining the EV100 initiative.
Nature based solutions can provide some of the most cost-effective answers to global climate change. You can support this by committing to due diligence on supply chains for commodities driving tropical deforestation such as soy, palm oil, cocoa, and coffee. And businesses can of course buy high-quality nature-based carbon credits as part of a credible corporate net zero plan.
Finally, businesses can also play their part in helping countries to deal with the impacts of climate change today and build resilience for the future. Financial institutions should prioritise the Coalition for Climate Resilient Investment, which is critical to securing objectives on pricing in climate risk in investment decision making. This can encourage private finance mobilisation towards high-quality resilient projects. They can develop specific innovative climate finance mechanisms for investments around adaptation and resilience, targeting private capital mobilisation for developing countries. And we encourage businesses worldwide to join the Call of Action on Adaptation and Resilience launched at the UN Climate Action Summit in 2019.
I hope that has given some insights into how the UK COP26 Presidency sees business as contributing to our global calls for urgent climate action. We are keen to engage closely with companies across Asia and in Malaysia specifically in the months ahead.
As countries around the world deal with the impacts of the Covid 19 pandemic, we must not lose sight of the continuing climate crisis. We all have a responsibility to act, and need to work together to meet our shared goals of the Paris Agreement.
Here is the webinar's Q&A, available for your download here.