COP 28

Climate change sell-out or landmark global warming fightback? Whatever your point of view, Cop28, the 28th such meeting of its kind, was not short on controversy. 

This year the event was held in Dubai and 84,000 people registered to attend. Critics often point to the carbon footprint of moving this many people from place to place regardless of whether they pay the extra money to “offset” the carbon footprint of the air travel.

Sultan Ahmed Al Jabber’s appointment as COP28 president was also controversial: Al Jabber is the Minister of Industry and Advanced Technology of the UAE and Chairman of the Abu Dhabi National Oil Company. Critics including Al Gore questioned whether it made sense for the meeting to be held in an oil-producing state and led by the chairman of a company that churns out more than 4 million barrels of oil per day.

This didn’t prevent the future of fossil fuels from taking centre stage as one of the main issues discussed at this year’s meeting alongside the ongoing discussions about equity and climate finance. There was also debate about the idea that funds should be provided to support countries impacted by climate change. 

Cop28 was also notable as it marked the first official stocktaking to measure the world’s progress against the agreement in Paris reached in 2015. The unsurprising outcome, which helped to focus minds and build Cop28 consensus, is that the world needs to transition to a low-carbon energy regime and the window to act is rapidly closing. 

In the end, the almost 200 countries involved committed to doing this although the final communique avoided strong language such as setting a specific timeline to phase out or end the use of coal, oil and gas. Instead, the language used was in the context of agreeing to keep the target of 1.5ºC average warming and “transitioning away from fossil fuels in energy systems, in a just, orderly and equitable manner, accelerating action in this critical decade, to achieve net zero by 2050 in keeping with the science”.

One way to look at COP 28 is that the event was a resounding success and marks the beginning of the end of the fossil fuel era. This was the tone of the remarks by Simon Stiell, a former tech executive before taking on his current role as executive secretary of the Convention in 2022. Al Jabber was even more triumphant as he told the assembled audience: ‘Together, we have confronted realities and set the world in the right direction. We have given it a robust action plan to keep 1.5[°C] within reach.

A contrarian view is that Al Jabber and his colleagues in other oil-producing nations have managed to postpone a clearer plan to phase out fossil fuels to protect their own interests. Greenpeace called the final agreement “disappointing” and expressed its concern that the next meeting, COP 29, is scheduled for Azerbaijan, another oil processing country.

In my view, perhaps the most significant achievement of COP 28 is that the countries of the world reiterated their commitment to the process itself. This involves increasingly ambitious nationally determined contributions or targets, as well as different groups of countries agreeing to do more than the rest, on issues ranging from banning coal to transforming their agricultural sectors.

The implication for business is that the world is clearly moving in the right direction. What this means is that the issue is not whether a specific company should transition to a low-carbon operating model but when. This makes it fundamentally a financial decision. My advice is companies should move to a low-carbon operating model sooner than later.

The even better news is that behind the scenes Global Capital has got the message and is putting its money behind industries, companies, and technologies which will be part of a carbon-neutral future. By Global Capital I mean the sovereign wealth funds and enormous pension funds which manage hundreds of billions of dollars.

The people who manage these organizations have already turned the page and are looking for innovative green energy and technology projects which will accelerate the transition away from fossil fuels. Many of them were in Dubai and are actively seeking projects and companies that will be on the right side of history. 

Cop28 just about delivered the collective willpower to keep the fight against global warming as a top priority. Sovereign wealth and pension funds and the projects they invest in are the ones tasked with actually winning it.