Why COP26 may have succeeded already

So, the second half of COP26 is underway, and the eyes of the world’s media are focused on whether this vibrant, significant and international jamboree will secure a ‘result’ when the curtain comes down on Friday night.

Will commitments on financial contributions from the developed to the developing world for a just transition be firmed up? Can we secure greater transparency on how countries report on their decarbonisation efforts? And what about that perennial favourite of COPs since Paris 2015, an agreement on international carbon markets?

With five days to go the negotiating teams will decide the outcome, urged on by the hosts.

Whatever emerges I would argue that this COP has already been a success. Why? Because for the first time business has really turned up. Turned up in droves and made substantial commitments to contribute to the global decarbonisation effort.

The CEO of Coutts bank, Peter Flavel, emphasised this shift towards business in an interview from Glasgow where he repeated a line from U.S. Special Presidential Envoy for Climate, John Kerry, that; “This (Glasgow) is the first time business has been at COP.”

According to Flavel, previous COPs have primarily been about “NGOs, Governments and regulators” and whilst they are “part of the solution” what is also needed is “to mobilise business, and then … finance a just transition across all the sectors in the economy.”

So why are businesses buying-in like never before? Yes, they are being prodded along by the stick of mandatory reporting on transition plans, and increased scrutiny on greenwashing. But more significantly they are motivated by the carrot that sustainability simply makes good business sense.

Companies are seeing that addressing the transitional and physical risks of climate change isn’t only good governance it attracts investors seeking sustainable businesses to back, keeps customers loyal and secures the most talented employees.

The flow of businesses embracing sustainability has become a flood and that is particularly important as the priority shifts to translating ambitions into short-term action or, in the mantra of the Race to Zero initiative a requirement to Pledge, Plan, Proceed, and then Publish the results of transition activity between now and 2025.

This is why COP26 has succeeded. It is the first, but not the last COP, where the business sector has turned up alongside the regulators, Governments and NGOs, and stated clearly ‘we are going to get this (decarbonisation) done’. That has energised sectors and businesses of all sizes into a ‘race to the top’ where the prize is sustainable market leadership, and the alternative obsolescence.

Yes, there is a risk that plans won’t be delivered fast enough, but there is also the reality that when you need something done it is the entrepreneurs in the real economy that have the skill, customer base, drive and influence to make it happen.  

Whatever ‘agreement’ is heralded by the UK Government at the end of this week, it may just be that the shift to a business led just transition is the major achievement of COP26 Glasgow.