Race to net zero08-11-2021
The COP26 summit aims at accelerating the deliverables of the Paris Agreement, whose main objective is to secure global net zero emissions by 2050 and limit to a 1.5° temperature increase. A swift and ambitious transition to a low carbon economy will ensure a better protection and adaptation of communities and natural habitats. Governments and States have been asked to commit for ambitious measures on 2030 reduction emissions targets, as well as restoring ecosystems and make infrastructure more resilient to climate change. To do so, countries have to boost the implementation and acceleration of the transition by financing a resilient net zero future. As defined by the European Commission, “Sustainable finance refers to the process of taking environmental, social and governance (ESG) considerations into account when making investment decisions in the financial sector, leading to more long-term investments in sustainable economic activities and projects”. Today, more than 85% of investors see climate change as a key theme in their portfolios (Robeco, The BigBook of Climate investing, 2021). With the current enthusiasm and interest from non-state actors – including companies, cities, regions, financial and educational institutions – to halve global emissions by 2030, the United Nations gathered all the current net zero initiatives into the Race to Zero and the Race to resilience (grouping 250 financial institutions). It aims at raising the common voice and make clear at the COP26 that parties are ready.
At CO2logic we have, over the last years, helped actors across the global financial system in understanding their ESG challenges and have supported them to start cutting carbon emissions from their portfolios/funds. With a clearer understanding of ESG risks in financial institutions’ portfolio, they are able to take near-term action towards net zero by 2050 consistent with 1.5 °C. Our recent merging with South Pole even accelerated our capacity to support clients in this sector. Reaching net zero is ambitious and the journey will at times be uncertain. However, there is no space for doubt. It is time to switch from ambition to action.