11 November 2021

FT: Big business and COP26: are the ‘net zero’ plans credible?

With the greatest respect, Prince Charles told world leaders at the COP26 summit last week, the private sector offered the only prospect of achieving the fundamental economic overhaul needed to avert a climate disaster.

The heir to the British throne was in Glasgow to bestow some royal favour on businesses he saw leading that change — companies as diverse as AstraZeneca, Bank of America, IBM and L’Oréal. His patronage came in the form of the Terra Carta Seal, an award created by former Apple designer Sir Jony Ive that features oak leaves, honey bees and a monarch butterfly.

The party at which Prince Charles mingled with chief executives captured a congratulatory mood at COP26 among some of the world’s largest businesses, many of which have used the summit to advertise fresh sustainability initiatives. But the regal validation was paired with a harsher critique from others at the summit — that many companies’ emissions-cutting plans do not oblige them to change their behaviour any time soon or hold senior executives accountable for realising them.

Some companies, the critics charge, are also engaged in hypocritical lobbying that is undermining the climate action they claim to want to see. For growing numbers of environmental activists, regulators and multilateral organisations, the voluntary steps companies have taken so far have had nowhere near the impact needed to steer humanity’s course away from climate catastrophe.

 Indeed, some in Glasgow argued, the focus on voluntary corporate action risks weakening the drive for badly needed government policy interventions. Such concerns are driving pressure for the next chapter of the corporate response to climate change to be marked by fewer parties and press releases and by more verifiable standards, mandatory reporting and meaningful carbon prices. “Their main goal at COP is to emerge as undisrupted as possible,” Pat Brown, founder of the alternative protein start-up Impossible Foods, says of both the business and political elites gathered in Glasgow.

Instead, he warned, “what is needed is radical change — and fast”. Embracing net zero Companies are not formally part of the Conference of the Parties meetings, which are reunions of countries that signed the 1994 UN Framework Convention on Climate Change. But this year’s summit was swarming with executives and their consultants, crowding out campaigners and even national delegates from Glasgow’s overfull hotels.

The corporate crowd jetted in with a self-assured message for politicians: that business has been leading the way on climate action and it is high time that governments catch up. The International Chamber of Commerce told governments to “wake up” to the risk that their patchwork of carbon pricing regimes could slow progress on cutting emissions. The US Business Roundtable and its counterparts in Europe, Australia, Canada and Mexico told world leaders that companies could not “shoulder the burden alone” of investing in new clean energy technologies and needed better co-ordination between countries.....

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