COP29 Outcomes

Here are some of the key theme's that came out of this year's summit:

Media attention focused on the summit's potential as a "finance COP" and the pressing need for increased financial commitments from developed nations to support developing countries' climate efforts. The current annual pledge of US$100 billion expires in 2025, falling significantly short of requirements. G20 attendees, representing 85% of the global economy and 75% of global emissions, face pressure to step up as the largest contributors to climate finance-focused multilateral development banks. Adding to the pressure, many private finance leaders were absent from this year's summit, potentially impacting investment progress.

Despite these challenges, negotiators welcomed a significant pledge from major multilateral development banks, including the World Bank, the European Investment Bank, and the Inter-American Development Bank, to raise US$120 billion in annual climate finance for developing nations by 2030.

Leaders also discussed and were given the green light to establish carbon credit quality standards under Article 6 of the Paris Agreement, which are critical to launching a United Nations (UN)-backed global carbon market.

Thankfully, the UN Climate Change Conference (COP29) concluded with a landmark agreement on a new funding target, known as the New Collective Quantified Goal on Climate Finance.

This ambitious goal aims to:

• Triple annual climate finance for developing countries: Increasing from the previous goal of USD 100 billion to USD 300 billion by 2035.
• Mobilise USD 1.3 trillion annually by 2035: This target reflects a concerted effort to scale up finance from both public and private sources to support developing countries in their climate efforts.

Underscoring the urgency, the UN warns that current global climate plans could lead to a temperature rise exceeding 3°C this century – drastically surpassing the Paris Agreement's goal of below 2°C.

(Sources: Arab News, Axios, Channel News Asia, Dawn, PBS, Reuters, The New York Times, Arab News, Financial Times, Reuters, Semafor, UN News)

NDC impact on global warming: a range of projections

Climate disclosures

On 12 November 2024, the International Sustainability Standards Board (ISSB) issued a progress report on the adoption of climate-related disclosures. According to the report, more than 1,000 companies have referenced the ISSB in their reports, and 30 jurisdictions are introducing its standards in their legal or regulatory frameworks. Notably, 82% of companies have disclosed information in line with at least one of the 11 Task Force on Climate-related Financial Disclosures recommendations. However, despite this, only 3% met all 11 recommendations. ISSB Chair Emmanuel Faber emphasized that the report demonstrates “significant and encouraging progress in disclosure of climate-related information” while highlighting the need for further action to help investors accurately assess and price climate-related risks and opportunities.

(Sources: Accounting Today, ESG News, Investment Executive, Investment & Pensions Europe)

Food & agriculture commitments:

The rising temperatures, extreme drought, heavy rain, and erosion that has increased with climate change threatens to destroy key agricultural resources. As a result, groups are making major investments toward climate-resilient agriculture solutions. The US and United Arab Emirates announced that their joint climate-friendly farming fund reached US$29.2 billion, which will help reduce the climate impact of agriculture and adapt farming to the impacts of global warming.

Additionally, Acumen, a global nonprofit impact investor, will commit US$300 million to small farmers to improve climate adaptation across Europe, the Middle East & Africa and Asia-Pacific regions.

The Asian Development Bank also launched a US$3.5 billion program to build resilience in regions impacted by glacial shrinkage, which has devastating effects on local agriculture and food security.

(Sources: ADB, Associated Press, Caliber, IPS News, Reuters)

A call for urgent action: Encouragingly, the United Kingdom announced an 81% reduction in greenhouse gas emissions by 2035, based on 1990 levels. To limit global warming, emissions must drop 42% by 2030 (from 2023 levels) and 56% by 2035. Current policies are projected to achieve only a 1% reduction.

(Sources: BBC, Bloomberg, Climate Home News, France24, Reuters)

Contact Dominic Wall for more information drwall@deloitte.co.uk