Dec 16, 2021

Pledges and Commitments with a Long-term View

The 26th UN Climate Change Conference of Parties (COP26) in Glasgow, Scotland concluded on November 12, producing the first major treaty on climate change since the Paris Agreement at COP21 in 2015. The Glasgow Pact includes a goal to limit warming to well below 2 degrees Celsius and preferably 1.5 degrees Celsius above pre-industrial levels by the year 2100.

The Glasgow Pact provides global acknowledgement that climate change is an urgent and pressing matter. There is a saying, “don’t let the perfect be the enemy of the good.” While the event did not accomplish all of its intended goals, it wasn’t all “blah, blah, blah” as Greta Thunberg, the 18-year-old climate activist, has accused. Discussions were solutions focused. Prior to COP26, the UN projected the world was on track for 2.7 C of global warming by the end of century, but with implementation of submitted targets and pledges, global warming is expected to be between 1.8 and 2.4 C.


The Glasgow Pact committed 197 countries to accelerate their efforts to transition to low-emissions energy systems, including to “phase down” unabated coal power and phase out fossil fuel subsidies — marking the first time fossil fuels warranted mention in a global climate agreement. Parties committed to revisit and strengthen their 2030 targets within a year, to better align with the Paris Agreement.

Developed countries were urged to at least double their contributions towards funding climate adaptation in emerging market countries. The Pact clarified certain rules around carbon trading, comprised in Article 6 of the Paris Agreement, allowing nations to partially meet their climate targets by buying carbon offsets — emissions credits from other countries. Notable COP26 highlights included the Global Methane Pledge to reduce methane emissions 30% by 2030. Representing the world’s first formal commitment to tackle deforestation, over 100 world leaders (including Brazil and Russia) pledged to end deforestation by 2030. India’s prime minister announced India will reach net zero by 2070, marking the first time India has put an end date to its GHG emissions. Most unexpectedly, the U.S. and China, jointly representing 42% of global emissions, declared they will co-operate on climate matters — clean energy technology sharing, reducing methane emissions, protecting forests and phasing out coal. Canada’s prime minister announced a hard cap on emissions of the oil and gas sector, taking some Albertans by surprise.

If that still sounds like “blah blah blah” to you, there’s more. The finance industry showed up with gift offerings: The Glasgow Financial Alliance for Net Zero (GFANZ) chaired by Mark Carney ($130 trillion AUM) was launched, focused on accelerating and funding the transition; a new International Sustainability Standards Board (ISSB) was launched to standardize environmental, social and governance (ESG) reporting for financial markets; and The Network for Greening the Financial System (NGFS) comprising 38 central banks committed to climate-related stress tests for the world’s largest financial firms, and the U.S. joined the NGFS.

COP26 proved that there is real money and weight behind the climate movement. World leaders, governments, business and civil society are on board. While certain stakeholders desired greater progress, climate issues cannot be solved in a vacuum or on a short-term basis. The only way to make progress is to keep the conversation going, until we figure out how to consume less, conserve and protect more and effectively transition to a carbon-neutral economy. Finding a sustainable solution for all requires collaboration from everyone — all players — and accountability. We can’t effect positive change unless we do this all together.