COP27: a first-hand account

One particular thing that struck me was how different the challenges facing many emerging and frontier markets are compared to more developed economies when it comes to the climate crisis.

I met many delegates from across Africa – for example – over the three days and was reminded of the differences within such a vast continent, where views and priorities vary greatly from the north to south, from east to west. For some, the priority was the opportunities in green hydrogen, for others it was about natural capital in the Congo Basin. Others told me they were focusing on the growth in renewables in Kenya and Southern Africa.

A common theme among these diverse delegates, however, was the “loss and damage” issue. That is, the fact that developed markets have not paid the $100 billion per-year promised by 2020 to finance climate initiatives in developing markets. That the negative impacts of the biggest polluters in the world disproportionately affect developing economies, means this unfulfilled promise is felt all the more keenly.

I also heard from a range of private sector entrepreneurs from emerging markets, many of whom are losing hope that developed economies will come forward with substantial assistance. They are increasingly of the view that they need to take action and be in charge of their own future.

After all, they are best-placed to know what local markets need. They are also conscious of the risk of carrying debts in US dollars, which has become all the more onerous as the dollar has strengthened significantly. In some cases there is also a resistance to relying on assistance from former colonial masters.

Among the various sessions I attended, I found those with indigenous people especially illuminating. Ensuring their inclusion has been one of the main challenges of the conference. Indigenous land contains 80% of the worlds remaining biodiversity, so listening to the voices and protecting the rights of these peoples is critical to reaching climate and nature goals. Though they are present at COP, their designated “observer” status gives them little influence on climate policy discussions and I was among those who felt it to be an inadequate arrangement.

Development finance institutions also came into focus for many at COP27. The scale of the climate challenges faced are bigger than development aid budgets and development banks’ capital. This means collaborations with corporates, asset owners and asset managers are the only way dollars can be multiplied for key climate initiatives to reach the scale required to have an impact. Blended finance – effectively public-private partnerships – was much discussed; in particular in relation to innovative climate finance initiatives that don’t have a track-record, and present more of a venture-capital type of risk, or around new asset class concepts like natural capital.

Regulators have pushed for more disclosure of climate risks in investors’ portfolios and a number of methodologies are competing for best in class; for example, the Science-based Targets initiative (SBTi), Taskforce for Climate-related Financial Disclosures (TCFD), soon the Taskforce for Nature-related Financial Disclosures (TNFD), among others. So there was much discussion on data availability, carbon measurement and reporting tools that can guide investors and make their life easier in terms of their impact on climate today and what it could look like tomorrow. The dream of everyone is to have one fairly low-maintenance tool across different strategies – mitigation, adaptation, and natural capital.

Finally, I found the human part of COP27 inspiring for the most part. At a time when virtual meetings still dominate my professional life, mixing in-person with former colleagues, practitioners, current and future investors, as well as delegates from around the world, was refreshing and reminded me of the value of face-to-face interaction.

The male bias was, however, notable. Perhaps unsurprisingly, the diversity challenges that the corporate and political worlds face are reflected at major conferences like this, with a remarkable number of panels and delegations comprised solely of men. I look forward to a greater female presence at future COPs.