What can businesses expect from COP26?

This year, 31 October will not only mark ‘All Hallows Eve’, but also a gathering of another kind as Scotland plays host to the 26^th UN Framework Convention on Climate Change (UNFCCC) Conference of the Parties, COP26.

The biggest climate change event since COP21 six years ago, is taking place at a time of heightened environmental awareness post-pandemic, and it arrives with a sense of urgency to change the planet’s course and deliver action. But what will COP26 cover, how will it drive change and what does it really mean for governments, businesses, the public sector and other bodies?

With two weeks to go until the summit opens, this is the first in a series of posts we’ll be sharing to bring you up-to-date on what to expect, what came out of the last major COP and why this one will have implications for so many. 

What is COP26? Platform for debate or catalyst for change?

… Or “the last best chance to avert environmental disaster”, as described by the US climate envoy, John Kerry. Strong words but with a clear focus on the need for action. Undoubtedly, given COP26 didn’t happen last year and the fact that each nation’s Nationally Determined Contributions (NDCs) (action plans for reducing emissions) will be under review, there are high expectations surrounding this year’s summit. It is also the first COP since the UK departed the EU, the first since the COVID-19 pandemic and will put the commitments of the Paris Agreement from COP21 in the spotlight.

COP26 will bring together representatives from up to 190 countries, along with tens of thousands of negotiators, government representatives, agencies, businesses and citizens; all with the aim of reaching agreement on how to tackle climate change across the globe. The timing is also significant – as COP26 Chairman Alok Sharma MP said this week, “Paris promised, Glasgow must deliver”. During the two-week international summit there will be discussions around a wide range of key issues – from net-zero carbon emissions, to clean energy, green finance and sustainable land development – and a focus on delivering decisive change.

How were things left after COP21?

The last major COP took place in 2015 in Paris (COP21) and gave rise to the landmark Paris Agreement – a legally binding commitment signed by almost every country around the world to reduce emissions. For the 191 Parties to the agreement, it set out that each nation must:

• reduce the amount of greenhouse gases produced and increase renewable types of energy, such as wind, solar and wave power;
• keep global temperature increase “well below” 2 degrees centigrade and to try to limit it to 1.5 degrees;
• review progress made on the agreement – through each country’s NDCs – every five years (i.e. at COP26); and
• collectively spend $100 billion dollars a year in climate finance to help poorer countries by 2020, with a commitment to further finance in the future.

The most recent COP, COP25 in Madrid in 2019, had intended to “tidy up” and finalise certain loose ends regarding the implementation of the Paris Agreement ahead of COP26. It certainly played an important role in bringing the Agreement into force but there is recognition that more stretching carbon reduction commitments are needed. (See our insights on COP25 – ‘What is happening at COP25?‘ and ‘COP25 negotiations prove anti-climatic while businesses take the lead‘.)

Getting ready for COP26

Importantly, COP21 gave nations discretion to alter NDCs and their approach. As we prepare for COP26, the focus now will centre on progress so far towards these targets. According to the NDC Synthesis report published by UN Climate Change on 17 September 2021, “2021 is a make or break year to confront the global climate emergency”. It calls for more ambitious national climate action plans in order to achieve the goal of limiting global temperature rises – to the extent that global emissions should be cut by 45% by 2030 from 2010.

Bringing the nations together at the end of this month will certainly provide an opportunity for review and some added peer pressure around progress with NDCs. For the UK, Brexit and the pandemic will understandably have affected progress but things are moving forward. In fact, the UK became the first major economy to put the goal of achieving net zero carbon emissions by 2050 into law. And decarbonisation of the UK economy has been faster than that of any other country in the G20 since 2000. We also have the Environment Bill on the horizon and a promised roadmap to achieving the net zero carbon emissions target.

So, there is lots to be optimistic about as we approach COP26 and also a feeling of anticipation. Climate change affects all aspects of our global economy and society, and so the outcomes of this summit will influence many – not least businesses.

Our legal experts in Environmental, Societal Governance (ESG) help clients respond to the complex legal issues and opportunities presented as the business and regulatory environment evolves. We will be closely following developments at COP26 and providing guidance on what businesses could be doing now as part of a planned approach to ESG and environmental matters.