COP26: The business case
What do businesses want from COP26? Catherine Early reports back from an event investigating this issue
Though the year has just begun, the government, campaign groups and businesses are already gearing up for the UN climate discussions in November – COP26. This is trailed as the most important climate conference since the Paris Agreement was signed in 2015, as countries show whether their actions have lived up to their rhetoric.
With Glasgow playing host, many see COP26 as an opportunity to showcase UK climate change action and innovation. But what do businesses want the conference to deliver? Representatives from several large businesses debated this at an event held by the Aldersgate Group at the end of January.
Sustaining trade
Trade was a strong theme. With the event held a day ahead of the UK's departure from the EU, many were conscious that the UK's future trade deals needed to be in line with its stated ambitions on the environment, and to support businesses in their net-zero transitions.
Martin Casey, director of public affairs Europe at cement manufacturer CEMEX, said: “The challenge is trying to understand how the current direction of travel in terms of trade agreements, and perhaps deregulation of industries, is reconciled with delivering sustainability. This is something we need to hear about from the UK government as we head to Glasgow.“
Understanding how the EU Emissions Trading System and the UK carbon trading system will work was also crucial, he added, as was getting article six of the Paris Agreement right – this covers carbon markets. Governments failed to reach agreement on carbon trading mechanisms at COP25 in Madrid.
David Symons, WSP's UK director of sustainability, said he wanted to see trade policies support the Environment Bill, and built-in commitments to net-zero. The government should also set consumption-based climate targets and cover embodied carbon within trade policies, he suggested.
Stephanie Maier, HSBC's director of responsible investment, said that an effective carbon price would be helpful in terms of allocation of capital. Carbon pricing requires a lot of data and disclosure, she acknowledged, but this would help investors to make better decisions and support companies that are transitioning to net-zero.
The government had an opportunity to show leadership at COP26, she added, but would need to translate its ambition to be the first to set a net-zero target into clear pathways for individual industries. These pathways should also reflect the interconnectedness of different sectors.
“We need a policy landscape that enables us to do business competitively, here in the UK and globally“
Raising standards
Anna Turrell, Nestl√© UK and Ireland's head of sustainability, concurred that environmental governance and standards should be front and centre of government policy. “We need a policy landscape that enables us to do business competitively, here in the UK and globally.“
Sarah Handley, Siemens carbon neutral manager, noted that public opinion on climate change had shifted in 2019, and that while COP26 is an opportunity for businesses to show what they can do, they will also be under a lot of scrutiny.
Several panel members spoke about the challenge of proving that their businesses were doing what they said they were doing, highlighting the number of reporting frameworks in existence. Casey said CEMEX was “over-required“ to report, and that simpler frameworks were needed. “In the UK alone, we're reporting on six different frameworks. Multiply that around the world,“ he said.
Turrell said: “There's a need for greater coherence in data. The Task Force for Climate-related Disclosures is incredibly important, and as that starts to scale and we get broader uptake, that will give us a better picture of where we are.“
Maier also noted last year's rising calls for action from campaigners, but stressed that the government had an important role in informing the public of the need for individual action. “That is a crucial point – this requires individuals, as well as what they do for work,“ she said.
Catherine Early is a freelance journalist.