COP26: Continuing the conversation in the new year
by Ana Fernandez-Kennedy
COP26 Insights
A final deal to work together to limit the ever-increasing risks of climate change, intensely deliberated for two weeks by the diplomats of nearly 200 countries, was reached towards the end of last year at the close of the COP26 climate conference. While some were quick to point out that the efforts weren’t nearly enough, others felt it was a solid step in the right direction. Whatever your opinion, it is clear that the struggle to tackle climate change remains a critical issue that must stay front and center.

In response to the pressing issue of deforestation a major pledge was agreed to by over 100 parties, including Indonesia and Brazil. The Glasgow Leaders' Declaration on Forests and Land Use aims to end and reverse deforestation by 2030 and the world will watch closely to see if that pledge is maintained by all parties over the next eight years.

Another important development to come out of the deal was the request for an accelerated timeline for world leaders to revisit and update for more urgency their 2030 targets, or nationally determined contributions (NDCs), by the end of 2022 instead of within the next five years. This is good news for countries most vulnerable to immediate climate change effects such as the rise in sea-level.

Despite being less economically and politically powerful, these vulnerable nations fought to have their voices heard at the summit, pushing for but ultimately not succeeding in rich nations committing to providing greater financing to poorer nations to deal with loss and damage. Wealthy nations balked at this request, despite them historically adding significantly more greenhouse gasses to the atmosphere than any developing nations. The compromise that was reached was merely the agreement to have “discussions” around the topic.
The negotiations for the Article 6 “rulebook” from the Paris Agreement were finally completed in Glasgow, where governments sought to ensure past issues and mistakes would be taken into account in determining the new international market rules surrounding carbon and GHG emissions. The three final pieces, which cover both government and private sectors,  include bilateral actions to reduce or remove GHG emissions, a new multilateral mechanism to replace the old Clean Development Mechanism (CDM), as well as addressing non-market international cooperation among governments. 

Discussions in Glasgow have reaffirmed that international carbon markets are a key part of reaching the Paris Climate Agreement goal of limiting average global temperature increases to 1.5 degrees Celsius. The negotiations at the summit strove to keep alive the goal of stopping global temperature rise beyond 1.5 degrees Celsius, but the more realistic number came out at 2.5 degrees Celsius with the chance of lowering that number only if very strict measures were adhered to and action was taken quickly.
Before the Glasgow Climate Pact, no other UN or international climate agreement had explicitly mentioned coal and the immediate need to move away from it. While the goal was to put an end to their use, the final language was softened from “phasing out” to “phasing down” coal and subsidies for fossil fuels after a successful push from China and India, leaving many disappointed in the weakened phrasing and others hopeful over the fact that the text did finally call for changes to the fossil fuel industry. 
Some of the most interesting things about this summit were the people involved. There was a heavy youth presence in Glasgow, with more than 100,000 of them marching in the streets to demand strong action. Within the actual participants, many delegations included high-ranking officials whose positions might not typically have included climate, indicating that this issue is now considered broad and far-reaching, and not meant to only be dealt with by a small group of people within each government. The private sector was also very active in pledging to invest in climate, be it through making new commitments around electric vehicles or financial institutions promising to mobilize more than $100 trillion to finance the energy transition.

As the world’s attention drifted away from the summit and towards the holidays and the new year, we will see what kind of momentum the participating nations can maintain as they step into 2022 with a host of pledges and promises that not only affect us today but will continue to have massive impacts for future generations. If we each commit to doing our small part, significant change is within our reach.

At Vasanda, we followed the summit closely and remain committed to being a part of the necessary change in the world of sustainable trade. With ESG now an integrated part of the investment selection process, we are able to fill a gap in verifiable data needed for responsible investing. A number of regulations have already been put in place and there are many more to come, where corporates will be required to disclose their environmental impact and GHG emissions. One such measure is the newly formed International Sustainability Standards Board (ISSB), intended to create a “comprehensive global baseline of high-quality sustainability disclosure standards to meet investors’ information needs.” To support this ever-growing number of regulations we developed the Vasanda EcoSphere solution, a tool which evaluates the environmental and social risks and commitments of private and public corporations to ensure investments are aligned with UN SDG, TCFD, and PRI targets.

With the critical importance of fossil fuels finally being addressed in the Glasgow Climate Pact, we can expect stricter regulations to come into place regarding GHG emissions. Our comprehensive EcoSphere tool provides users with the emissions data of each transaction, from source to delivery. We hope that the in-depth data we provide on the emissions and the environmental impact of a trade leads to the transparency needed to continue pushing for change in the sector. 

JANUARY, 3 / 2022
Ana Fernandez-Kennedy
Marketing & Product Lead

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