ERMers around the world — on the ground in Sharm el-Sheikh, in our home offices, and virtually — took this month’s COP27 as an opportunity to engage in conversations about how we can best drive progress forward. As part of an engaged, youth-driven team in ERM’s United States offices, we collaborated on convening a series of virtual company-wide discussions, working together to gather expert insights across ERM linked to four key thematic areas of COP27: gender, sustainable finance, biodiversity, and decarbonization. In this piece, we review the results of this year’s COP discussions through the lens of each of those four thematic areas.
This year saw the United Nations Framework Convention on Climate Change (UNFCCC) hold the 27th Conference of the Parties (COP) in Sharm el-Sheikh, Egypt. One hundred and ninety seven countries met to discuss their progress and implementation of emissions reduction goals under the 2015 Paris Agreement to “limit global warming to well below 2°, preferably to 1.5° Celsius, compared to pre-industrial levels.” Beyond negotiating parties, COP27 was attended by activists, businesses, NGOs, and scientists looking to advocate for communities and civil society and provide urgent perspectives in the policy process.
Dubbed the “Implementation COP,” this year’s meeting hoped to provide substantive implementation measures for previously announced decisions and commitments. The multilateral negotiations provided at COP27 were held in the middle of the first Global Stocktake (GST) process, which aims to periodically review countries’ progress towards climate action and emissions reduction as set in their Nationally Determined Contributions (NDCs). Achievement towards collective progress not only consider emissions mitigation, but also adaptation, equity, and financial support among countries as the world faces and responds to increasingly severe climate change impacts.
The vision of COP27 also included new thematic focus on topic areas that seek to engage a broader stakeholder audience on key agenda items than in years past including youth, women, indigenous peoples, and civil society.
The UNFCCC has noted again that there is work to be done to promote greater inclusivity in its own proceedings, calling upon all parties to promote gender balance in national delegations and nominations of women as high-level climate champions.
Climate change continues to disproportionately affect women while women continue to be underrepresented in climate-related decision-making. Gender Day – one of COP27’s Thematic Days – sought to integrate women more fully into the processes of formulating and implementing policies, strategies, and actions that are more gender inclusive. Of particular focus at COP27 was the Gender Action Plan initiated two years ago, which aims to advance knowledge and understanding of gender-responsive climate action across the UNFCCC and constituted bodies, and women’s meaningful participation in the UNFCCC process itself.
After two weeks of negotiations, the main outcome on the topic of gender at this year’s COP may be a recognition of how much work there still was to be done. The Gender Action Plan received an intermediate review this year, about which Jackie Lerner of ERM said: “disappointingly but not surprisingly, global progress toward effective gender-responsive climate action has been greatly slowed by the COVID-19 pandemic. The need for accelerated efforts was acknowledged at COP27. The Gender Action Plan itself was amended to augment the intersectionality of participation in leadership: expanding the call to prioritize women’s participation to include young women, indigenous women, and women from local communities.”
Unlocking climate finance continues to be the key to progress, and that really puts governments and financial institutions at the center.
With COP27 aiming to be the “Implementation COP,” efforts around climate finance focused primarily on making progress on previously made financing commitments. At COP15 in 2009, developed countries committed to mobilizing USD 100 billion for climate action by 2020 in developing countries. In 2022, contributions to this goal reached approximately USD 90 billion, missing the goal deadline by two years and falling just short of COP15’s goal. However, developed countries now hope to meet the USD 100 billion annual goal by COP28 and eventually exceed the goal in the years to come.
Another major finance-related topic this year was “loss and damage,” which encompasses financial support for losses that vulnerable countries face from a range of climate-related impacts. Despite the failure to meet COP15’s climate finance goal, leaders at COP27 agreed to a historic loss and damage fund. This fund aims to make vital progress towards channelling financial support to vulnerable communities that are suffering from devastating climate-related impacts. While this has been hailed as a “breakthrough agreement,” the details are to be negotiated in the next year. Major questions are still unresolved regarding how this fund will work. Who contributes to it? Who receives the funds? And who is a developing nation?
Climate change and biodiversity challenges are inextricably linked. In the final Sharm el-Sheikh Implementation Plan, COP parties highlighted the need to protect and restore nature in order to maintain global warming temperature limits under 1.5° C. Dedicated sections within the Implementation Plan on Oceans, Forests, and Agriculture, alongside the longstanding topics of Finance, Adaptation, and Capacity-Building, demonstrated how biodiversity was taking stronger root alongside climate conversations at COP27.
There is a rising interest in practices such as nature-based solutions (NbS) and natural climate solutions (NCS) that bring co-benefits to climate, environment, and society. Maintaining and restoring ecosystems can not only contribute to adaptation against severe weather impacts and develop sustainable food systems, but can also be a source of carbon stocks and preserve cultural significance. When considering that the root causes of climate change and environmental degradation are linked, it becomes evident that the demands for social equity that address both are as well. This was evident both through the multiple indigenous representatives advocating for community rights in the protection of nature, and in the call by Brazil’s President-elect Luiz Inacio Lula da Silva to end Amazonian deforestation.
The ENACT (Enhancing Nature-based Solutions for an Accelerated Climate Transformation) initiative announced by the Egyptian COP27 Presidency along with the IUCN (International Union for Conservation of Nature) will serve to coordinate and compile NbS initiatives in addressing climate change, biodiversity loss, and land degradation. It provides a clear signal regarding the prioritization and coordination of global NbS commitments. With the UN Biodiversity Conference COP15 taking place in early December 2022, world leaders and citizens are likely to keep biodiversity protection at the top of their agendas.
Entering COP27, stakeholders around the world made urgent calls for global decarbonization through a clear plan to phase out all fossil fuels. By the end of the conference, the absence of such an agreement by the end of COP27 left many wondering about the continued feasibility of reaching the 1.5° C global warming limit set out in the Paris Agreement.
The mitigation work program, that is, how to ratchet up the ambition towards 2030, is behind where it needs to be as we head into 2023.
In the final hours of this year’s COP, negotiators made subtle changes in the negotiating text. One of the most noted was the insertion of references to “low emission and renewable energy” sources. The term “low emissions energy sources” is widely seen as opening the door to fossil fuel gas and/or carbon capture and storage being factored into transition plans for energy systems around the world.
Some strides were made at local and national levels. A number of countries made new plans and commitments at COP27. India, for example, shared its first decarbonization plan to achieve net zero emissions by 2070, focusing on prioritizing cleaner fuels.
Negotiators also made strides within certain industry sectors. The 2030 Breakthrough Agenda, first announced at COP26 as a platform to encourage decarbonization of five key emitting sectors including power, steel, road transport, agriculture, and hydrogen, was updated in a process led by broad coalitions including the G7, the European Commission, India, Egypt, and Morocco. These updated sector-focused actions will aid the scaling up of clean technologies addressing affordability, innovation, and deployment.
Other particularly notable outcomes included directing private and public procurement and infrastructure spend for low-carbon industrial goods; creating, under the multilateral Climate Investment Fund, an Industry Transition Programme focused on vulnerable countries; and launching the Sharm el-Sheikh Methane Reduction Roadmap.
Securing a just energy transition, in which workers and communities are not left behind by decarbonization initiatives, was also a theme of discussion. Achieving committed support for a global just energy transition, including a focus on unlocking capital for vulnerable countries, continues to face challenges. Yet, the Sharm el-Sheikh Implementation Plan underlines just transition principles – including inclusivity and social solidarity – into the framework of the future.
Where we go from here
The urgency of COP27 was a familiar echo of previous COPs. While some progress has been made, there is still a long way to go. Continued global challenges — including Russia’s war on Ukraine, the energy crisis, rising costs of living, and threats to our food system — continue to underline the importance of collective cooperation in tackling the climate crisis.
The “Implementation COP” demonstrated how challenges are not seen separately but are increasingly intertwined together with a focus on highest-emitting sectors, countries, and levers of change. There is a clear imperative for investments made in the low carbon economy transition and nature positive thinking by both public and private actors to “keep 1.5° alive.” Efforts towards meaningful inclusion of civil society and grassroots voices at COP27 have demanded that topics of justice and equity be at the forefront of any transition work and will continue to be in the future. As the world looks to next year’s COP28 in Dubai, there is a sentiment of shifting systems towards climate and social justice. This is particularly salient as we consider whose voices shape which outcomes and how to implement key mechanisms for climate action such as the loss and damage fund.
As the outcomes of COP27 crystallize over the months to come, it will be important not only to follow climate decisions made, but also to highlight climate actions not yet addressed. Key stakeholders must ensure that the details of agreed upon actions are formulated in a manner that upholds the previously made commitments to climate action with integrity, and in particular, the Paris Agreement. 1.5 °C is not just a target – it is a limit and negotiating parties must treat it as such.
Additional Contributors: Brian Tretter, Hannah Cordio, Mairead Donnard, Nicholas Haluska, Sammy Russell