CEO Statement: Takeaways from COP27 - Eleventh-hour progress, but who pays?

“For two weeks, global leaders and negotiators have been in Sharm El-Sheikh to advance policies with the goal of keeping global warming below 1.5 degrees Celsius and building a more resilient world. Eleventh-hour progress on the thorny issues of Loss and Damage funding, and the Article 6 guidance on carbon markets, was enough to keep the goal of +1.5C alive for now – but only just.

“A global crisis necessitates a global response, but we also need leaders to follow through on existing pledges and unlock more of the much-needed financing and policies required to keep us on a path to 1.5 degrees.

“Not every climate COP can be like Paris; getting 196 countries to agree on policies that will deliver a measurable impact globally will always be challenging. Coming into Sharm El-Sheikh, expectations were low given that major decisions aren’t anticipated until the COPs in 2024 and 2025. However, countries like the United States and Brazil have met or exceeded expectations in recent months. The U.S. is on track to make unprecedented investments in climate action and, with the election of Lula in Brazil, critical ecosystems in the Amazon have a future. Presidents Biden and Xi also resumed climate cooperation. Getting the two biggest emitters of greenhouse gas emissions back to the negotiation table is critical for global action.

“Developed countries have agreed to talk about creating a fund for ‘loss and damage’ for the first time, partially delivering against a longstanding request from the most vulnerable countries. The fund would not deliver the additionally sought component of liability and compensation for past greenhouse gas emissions from major emitters, but it has moved the needle toward large historical emitters starting to shoulder the burden for past actions. And, carbon markets negotiations continue to the build the structure under which countries and the private sector can utilize trading to scale up greater ambition.

“Public finance must play its part to generate the funding needed to keep the world on track to 1.5 degrees Celsius. But it cannot support implementation of key climate targets, especially around adaptation, on its own. The public and private sectors must step up with financial instruments to fund actionable, scalable, and equitable on-the-ground solutions to reduce emissions and build resilience, such as blue bonds, and reform the way the Multilateral Development Banks align their development lending with climate targets.

“Last year, we saw nature take center stage for the first time – and in Sharm it was clear it’s here to stay. Nature-based solutions have been at the heart of many discussions at COP27, and this year, food and agriculture were front-and-center. Food systems account for one-third of total global greenhouse gas emissions and the vast majority of biodiversity loss. The world’s food system must be transformed to achieve a stable climate, continue to feed people, and reduce the destruction of nature.

“The final COP27 deal articulates numerous steps forward, including recognizing the link between the biodiversity and climate crises and the need to build resilience – especially in food systems. It includes a strong call for greater investment in renewable energy while continuing the push to phase out coal and inefficient fossil fuel subsidies. It calls on multilateral development banks to significantly increase climate ambition for greater results, including on private capital mobilization and a more efficient use of resources such as risk capital vehicles. It continues to recognize the critical role Indigenous communities play in conservation and reiterates for the continued implementation of Nature Based Solutions. These are all well-meaning global calls for enhanced action and finance – it is now time for us all to engage and help make them stick.

“In just three weeks, policy makers will gather in Montreal for UN Biodiversity Conference CBD-COP15 to deliver an ambitious Global Biodiversity Framework to halt and reverse unprecedented nature loss by 2030. This work is critical to achieving the goals within the Paris Agreement.

“Investing in nature-based solutions like forest protection, reforestation, mangrove and peatland restoration, and climate-smart agricultural solutions, alongside reducing emissions from deforestation, must be on a level playing field with technological and built-infrastructure solutions. These solutions are essential to meeting global climate and biodiversity goals.

“Time is running out to prevent the worst impacts of the climate crisis and the world is now paying attention. We can’t just sit by and watch as the most vulnerable are disproportionality affected – and soon enough it will reach us all. Limited progress was achieved in Sharm but much more is needed, much faster. The health of all life on this planet is at stake – if we don’t act now, we will all pay later.”