Developing a measurable, actionable and business-aligned climate plan is the (only) step forward for private and public companies.
Last week, we had insightful discussions with business leaders, investors, academics, policy makers and civil society representatives, who are driving climate action globally.
Here are our takeaways from North America’s largest climate event:
- Investing in climate is a strategic decision
A growing number of institutional investors acknowledge the need to direct finance to climate change. In fact, navigating the low-carbon transition is the most important priority of the next 1-3 years for nearly half of investors, according to a 2023 survey by BlackRock. The next step is for investors to evaluate the climate alignment of existing portfolios and craft a net-zero investment strategy that drives capital to climate solutions.
- Climate inaction is now a business risk
At this stage of the transition, there is no tolerance for grand plans without demonstrable action and progress. Corporate leaders spoke about investors and regulators demanding more transparent climate disclosure. It is now required in various jurisdictions under the International Financial Reporting Standards (IFRS) S2 and the EU Corporate Sustainability Reporting Directive (CSRD). They sit alongside the increasing legal and reputational risks associated with both greenwashing and greenhushing. Organizations need to communicate transparently on how they are executing on their commitments.
- Moving the needle on nature and biodiversity
Climate Week NYC marked the release of the Taskforce for Nature-related Financial Disclosures (TNFD) recommendations, a long-awaited set of recommendations on integrating nature-related issues into decision-making, risk management and disclosures. These guidelines will help support the growing group of investors engaging on biodiversity loss and businesses that depend on nature to sustain their supply chain operations.
- Carbon markets are shifting to removal-based solutions
Voluntary carbon credit markets have existed for years but the difficulty to measure their positive climate impact has put them under scrutiny. As capital markets are making climate a key part of their strategy and deep decarbonization is necessary to meet our net-zero objectives, stimulating the supply of carbon dioxide removals (biochars or mangroves) is becoming increasingly important.
- Climate tech investment is key to meeting net-zero
Despite the global economic uncertainty, the climate tech market remains active — reaching a record $70.1 bn last year. So far in 2023, the following areas have been most attractive globally: circular economy, food system management and energy storage and distribution. In addition to the importance of nature-based solutions, climate innovation at the forefront of the low-carbon transition will remain top of mind for asset managers and owners alike.
If you are ready to take the next step on your climate journey, please get in touch.
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