Sustainable Switch: COP27 draft deal done, but no ‘loss and damage’
18/11/2022 14:00
Sharon Kimathi
Energy and ESG Editor, Reuters Digital
Hello!
Time flies when you’re keeping track of COP27 climate summit
developments. There’s good news and bad news. The good news is
that the United Nations climate agency published a draft
negotiating text for a deal. The bad news is that it doesn’t
quite cover the ‘loss and damage’ financial compensation
vulnerable and developing countries have been pushing for, which
is arguably one of the most crucial elements of any COP deal.
But before we jump into it, please note that this is the last of
the daily Sustainable Switch coverage for COP27. We will revert
to giving you all the latest environment, social and governance
(ESG) news in your inbox every Tuesday and Thursday.
Now, let’s get to it!
The draft text, which builds on earlier, less formal iterations,
did not set out the proposed solution to one of the most
contentious issues at the summit, the 'loss and damage'
financial arrangements to provide funding to developing
countries suffering catastrophic climate events.
Climate negotiators on Friday were mulling a late-night stirring
intervention by the European Union which proposed a resolution
to the impasse over financing for countries hit by
climate-fuelled disasters and pushing this year's U.N. climate
summit in Egypt closer to a final deal.
The EU’s proposal is to set up a special fund for covering loss
and damage in the most vulnerable countries - but funded from a
"broad donor base". It seeks to offer a middle ground, and the
European Commission vice-president, Frans Timmermans stipulated
that it should be met by countries agreeing to step up their
ambition to slow climate change.
The special fund for covering loss and damage in the most
vulnerable countries would be funded from a "broad donor base",
suggesting that high-emitting emerging economies like China
would have to contribute, rather than having the fund financed
only by rich nations that have historically contributed the most
to warming.
This is a sentiment echoed by the German Development Minister
Svenja Schulze who told broadcaster Bayerischer Rundfunk that
countries like China should contribute more to compensation
payments for countries hit by climate-fuelled disasters.
"China has 28 percent of the greenhouse gas emissions at the
moment. So, they must also contribute to dealing with the
damage," Schulze told Bayerischer Rundfunk in an interview.
"They always hide behind the fact that they are a developing
country. But de facto they are no longer a developing country."
Hours before the EU's intervention, U.N. chief Antonio Guterres
prompted negotiators at the climate summit to overcome a
"breakdown in trust" between rich and poor nations to deliver a
deal to save the world from the worst of global warming. This
comes after COP27 President Sameh Shoukry – foreign minister of
host country Egypt – had told reporters that countries were
"shying away from taking the difficult political decisions" on
loss and damage.
Meanwhile, negotiators working on a separate track to nail down
details around global carbon offset trading may announce
incremental progress made so far.
More at COP27
* Climate-change protesters threw flour on Friday over a
sports
car painted by the U.S. pop artist Andy Warhol that is on
display in Italy's financial capital.
* Talks to establish carbon offset markets to allow
countries to
buy credits to partly achieve their climate pledges are set to
drag on beyond the COP27 summit and into next year, according to
observers and a negotiator in the U.N. talks.
* Climate change-related litigation has more than doubled in
the
past seven years globally, according to a June report by the
London School of Economics, and is moving beyond traditionally
polluting industries such as fossil fuel production.
* The United States aims to only sell and produce
zero-emissions
medium- and heavy-duty vehicles like school buses and tractor
trailers by 2040, the U.S. energy secretary agreed at the COP27
climate summit in Egypt.
Talking Points
* Twitter owner Elon Musk's mandate that employees stop
working
remotely and put in "long hours at high intensity" discriminates
against workers with disabilities, a new lawsuit claims.
* The share of women and minority leaders taking on CEO
roles has
stagnated since last year at top U.S. companies despite
corporate pledges to improve diversity, according to fresh
research from recruiting firm Heidrick & Struggles, which
attributed the trend to slow leadership turnover.
* Tesco, Britain's biggest retailer and one of the country's
largest private-sector employers, is offering its staff advances
on their pay to help them navigate a worsening cost-of-living
crisis, it said on Friday.
* Krispy Kreme agreed to pay $1.19 million to settle U.S.
Department of Labor charges that it failed to properly pay
overtime to several hundred workers, the agency said.
* Column: China’s massive deployment of renewable generators
is
starting to limit its heavy reliance on coal-fired power
stations, ensuring the government remains on track to achieve
its target of overall emissions peaking before 2030.
In Conversation
Patricia Pina, head of research and innovation at Clarity AI, a
U.S.-based sustainability technology platform, provides her
insight on sustainable finance regulation in Europe:
“Additional guidelines and clarity of what ‘sustainable’ means
is always welcome and will help in the fight against
greenwashing.
“Transparency and trust is paramount for consumer confidence in
sustainable investment products, yet, still we lack access to
reliable, precise data to distinguish claims from facts.
“We examined a sample of roughly 750 funds marketed as Article 9
under the EU Sustainable Finance Disclosure Regulation (i.e.,
financial products with sustainable investing as their primary
objective) and found that some might be falling short of
complying with the do no significant harm criteria as defined by
this regulation.
“Companies that violate global norms such as the United Nations
Global Compact principles, derive most of their revenues from
activities related to fossil fuel, or are worst performers in
areas such as gender diversity, or renewable energy consumption
are often included in these funds.
“In this regard, we welcome that the Financial Conduct Authority
is learning from the EU experience and has announced that the UK
sustainable disclosure regulation will be based on a labeling
regime. We expect that such a regime can push clarity to the
next level."
ESG Lens
Canadian Prime Minister Justin Trudeau will attend next month's
U.N. biodiversity summit in Montreal, the country's environment
minister said – despite the event's official host China plan to
send no invitations to world leaders. At the nature summit,
dubbed COP15, countries will try to agree a global deal to
protect nature and wildlife, as species populations plummet and
landscapes are degraded.
Quote of the Day
"We must prevent steel producers from classifying their
products as green when the same products are available on the
market with significantly lower carbon emissions."
Francesc Rubiralta, chairman and CEO of CELSA Group, a
multinational producer of low-emission circular steel and
founding member of the Global Steel Climate Council
Looking Ahead
* There will be an LGBTQ+ protest outside the London Qatar
embassy
ahead of the World Cup. Campaigner Peter Tatchell leads the
demonstration on Nov. 19.
* Climate activists from environmental campaign group "Rise
for
Climate" gather outside EU institutions to call for a boycott of
the Qatar World Cup on Nov. 20, as the soccer tournament kicks
off in Doha.
* With 20,000 ‘grave’ lights on the stands and 6,500
"footballs"
filled with sand on a football pitch in Herne, demonstrators
commemorate on Nov. 20 the migrant workers who allegedly have
died on World Cup construction sites in Qatar.
* Look out for the next Sustainable Switch on Nov. 22 as it
reverts to its original dates every Tuesday and Thursday.
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