While the Paris Agreement certainly represents the most important part of the international effort to alleviate the impact of climate change, there is also increasing recognition that the business world needs to play a central role in meeting net zero, as industrial activities are the biggest contributor to rising temperatures on the planet. The World Bank estimates that $4 trillion of finance needs to be mobilised annually to invest in mitigation and resilience in the Global South, and most of this needs to be financed by the private sector.
'Race to Zero' is one of the many initiatives started to rally the support of businesses to achieve net zero by 2050. Led by the UNFCCC Champions for Climate Action, the campaign aims to create a race within and between different businesses sectors representing at least 20% of any given industry to make a tangible difference. Around 1/5 of FTSE 100 companies have signed up to 'Race to Zero' to date, click here to see which organisations have signed up so far.
Businesses are also taking their own initiatives, and many have voluntarily announced their own targets to reduce their emissions. For example, Apple and Amazon have pledged to become carbon neutral by 2030 and 2040 respectively, and Microsoft has committed to be carbon negative by 2030. Other campaigns include the Re100 initiative, which encourages businesses to use 100% renewable energy by 2050 and the EV100 campaign, which is urging businesses to transition to zero-emissions electric vehicles by 2030.
On 17 March 2021 the Department for Business, Energy and Industrial Strategy published its Industrial Decarbonisation Strategy which sets out how industry can decarbonise in line with net zero while remaining competitive. It also contains an indicative roadmap to net zero for UK industry and the paper can be accessed here. UK businesses in the coming months will be looking to the Government for further details on its regulatory strategy ahead of COP26.
Over the coming months, Travers Smith will be updating this page to keep you informed of all the key developments and news in the run-up to COP26. Travers Smith is involved in a number of different initiatives connected to COP26.
- Jonathan Gilmour, our Head of Derivatives and Structured Products at Travers Smith, has recently been appointed to the Principles & Contracts Working Group of the Taskforce on Scaling Voluntary Carbon Markets. Launched in September 2020, this is a private sector initiative working to scale a workable carbon credit market so companies can meet their carbon reduction commitments through purchasing carbon offsets.
- Travers Smith's Environment Committee is actively committed to helping the firm reduce its overall carbon footprint and acting in an environmentally friendly and sustainable way. For more information on our efforts in this area, please see our Environment page here.
- Please also see our Sustainable Business Hub – where you can find resources designed to help you and your business to anticipate regulatory developments, proactively manage risk and achieve your ESG focused business objectives.