Rebooting sustainable finance and ESG 

AS THE dust settles from the 2022 United Nations Climate Change Conference in Egypt, there is clear criticism about the lack of impetus and action. Current commitments reviewed at the conference (commonly known as COP27) are so insufficient that projections show global temperatures may overshoot 3 degrees Celsius by 2100. Yet, even after recent and severe weather incidents, there was no clear signal of urgency.

Without new commitments for significant and additional funding, financing gaps remain – especially to help developing countries. That sense of urgency and insufficiency indicts governments, and also raises expectations for companies and the private sector to do more. There are increasing calls by concerned citizens, consumers and investors for companies, especially the largest ones, to take action.

Increasing private green finance

Much depends on money. Efforts to stem climate change and make the transition to sustainability will require massive financing. The Sharm El-Sheikh Implementation Plan from COP27 highlights that between US$4 trillion and US$6 trillion per year needs to be invested in renewable energy in order to reach net-zero emissions and transform into a low-carbon economy by 2050. Yet the bald fact is that developed countries have not met their previously agreed commitment to provide even US$100 billion every year.