By Ira Srivastava
1. Colombia announces historic climate investments. Susana Muhamad, Colombia’s environment minister, announced that the country would launch a US$40 billion investment plan to transition away from fossil fuels. This money would go into sustainable tourism, biodiversity conservation, renewable energy, and more. Colombia is one of the most ecologically significant countries in the world, being home to almost 10% of the world’s biodiversity and over 60,000 species. Negotiations with development banks to help fund part of this transition are expected to begin during COP16, as this important biodiversity conference will be hosted by Colombia. Colombia is already one of thirteen countries that supports the Fossil Fuel Nonproliferation Treaty and continues to avoid new oil and gas projects.
2. New York Climate Week 2024. Here are some highlights from the annual Climate Week conference in New York City.
- Companies are preparing new disclosures in response to regulatory requirements emerging around the world, but some compliance-related bumps along the way are expected in the first few years.
- The goal of limiting warming to 1.5 degrees Celsius is largely out of reach, as the world failed to achieve targets set under the 2015 Paris Agreement. The new goal is to keep warming “substantially below 2.0 degrees”.
- A new framework, the Taskforce on Inequality and Social-related Financial Disclosures, was announced to address the social aspect of ESG.
- Global institutions such as the United Nations were criticised by figures such as Al Gore, sharing that the requirement for unanimity and veto power was hampering climate efforts. He also pointed out that allowing petro-states to host three consecutive COPs was “really ridiculous”.
3. The impact of ESG backlash may be exaggerated. Chuku Umunna, JPMorgan’s global head of sustainable solutions, shared that the loud backlash against ESG may not carry much substance. It might have pushed companies to be less vocal about ESG and sustainability initiatives, but these organizations largely continue to carry out these programs. Shareholders continue to push companies to improve their environmental, social, and governance practices around the world. He argues that inflation and interest rates are more likely explanations for companies changing course.
4. Morningstar’s 2024 Voice of the Asset Owner Survey. Every year, Morningstar surveys 500 asset owners around the world on regulations, stakeholder engagement, sustainability, and more. Here are some takeaways.
- 64% of respondents felt that environmental issues were increasingly material, compared to 52% the previous year. Similar trends were observed in social and governance factors.
- The above findings were largely consistent among geographical regions, with only small variations between North America, Europe, and APAC countries.
- Reaching net-zero, strong labour practices, and business ethics were the most material issues in environment, social, and governance categories respectively.
Read the full report here.
5. Climate Group’s new initiative gains steam. Climate Group launched a 24/7 Carbon-Free Coalition at New York Climate Week with the eventual goal of 100% green energy usage 24/7. Founding organisations include Google, AstraZeneca, Vodafone UK, and more. In 2023, 40% of global electricity demand was met by renewables. Through technological innovation and engagement with electrical grid stakeholders, the group hopes to reach 100% in the near future.and least environmentally damaging sources of energy. Hundreds of workers die in coal mines every year compared to nuclear energy production where one person dies on average every 25 years.
Ira Srivastava is Competent Boards’ Program Coordinator. Follow Competent Boards on LinkedIn.