As a knowledge partner of the Climate Governance Initiative, the Centre for Climate Engagement (CCE) has written a briefing for board directors called COP29 Outcomes: Implications for board directors.
From 11–22 November 2024, leaders from nearly 200 nations met in Baku, Azerbaijan, for COP29, dubbed the ‘finance COP.’ Discussions focused on a new climate finance goal to help developing countries address climate change.
Key takeaways:
Global climate finance remains complex, with challenges in determining its forms, timing, flow, and accountability. Despite tensions at COP29, board directors can support their organisations by driving investments that mobilise private capital for climate action and demonstrate the need for reforms in international finance systems.
The new climate finance goal (NCQG) includes a commitment to triple finance, aiming to mobilise $1.3 trillion annually by 2035, with significant private sector involvement. Public-private partnerships could balance finance flows, and directors should align their organisations’ private finance mobilisation strategies with public finance initiatives.
Tools like the Net-Zero Export Credit Agencies Alliance’s Target-Setting Protocol help public finance institutions set net-zero targets and de-risk investments in emerging markets. Board directors should consider how such mechanisms can support their organisations in mobilising private finance and addressing value chain vulnerabilities.
New international carbon market standards under Articles 6.4 and 6.2 of the Paris Agreement provide clearer rules for carbon removal and trading. These developments present opportunities for directors to refine their organisations’ carbon market strategies while addressing challenges such as the low impact of many existing carbon credits.
Data shows most companies are falling short of the Paris Agreement’s 1.5°C target, with listed companies likely to exceed their carbon budgets by 2026. Board directors should ensure transition plans deliver real-world emissions reductions and consider raising ambition levels to align with credible climate goals.
The International Transition Plan Network (ITPN) was launched to support private sector transition planning. Directors can use this platform to guide strategic discussions and align plans with global frameworks for credible climate transitions.
COP29 highlighted the need to scale up climate adaptation, with plans now covering 2 billion people. The Race to Resilience campaign aims to increase resilience for 3.2 billion people by 2030, emphasizing adaptation as a critical area for board-level focus.
New ISO ESG Implementation Principles were introduced to help organisations improve reporting and compliance, particularly for SMEs. Board directors should assess how these principles align with existing practices and explore opportunities to strengthen ESG strategies at the organisational level.
About the Climate Governance Initiative
The Climate Governance Initiative is a non-profit that empowers chairs, non-executive and independent directors on every continent to take climate action by enhancing their knowledge and skills in climate governance. It is a rapidly growing global network with Chapters in over 70 countries worldwide.