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Climate change 06 Nov 2020

Countdown to COP26: London and Paris will lay the groundwork for Glasgow 2021 to fight the climate crisis

The Glasgow Climate Change Conference, which was planned for November, will have to wait until 2021 due to the pandemic. The global problems that existed prior to the arrival of COVID-19, which are still affecting the planet and will have an impact in the future, have not disappeared. The climate crisis cannot wait and remains a central topic on the agenda of all main actors - from governments and non-profits to the private sector. The upcoming preparatory meetings in London and Paris are proof that the organization is continuing its roadmap to remind us of just how much the planet has at risk.

Caused by greenhouse gas emissions, global warming, poses severe risks to the global economy and will affect many economic sectors. The Financial Stability Board (FSB) established the Task Force on Climate-related Financial Disclosures (TCFD) in 2015 - a working group to encourage companies to report to investors their climate change related risks and how they manage them.

Since 2017, the TCFD guide specifies that the reporting should be coherent, reliable and clear. Therefore, companies will be prepared for the challenges that arise and will provide the necessary information so that investors can evaluate their climate performance.

From inadequate results at COP25 to the great opportunity at Glasgow

Many consider Glasgow the most important climate conference since COP 2015 when the Paris Agreement was concluded. Countries are expected to react with more powerful plans to cut emissions due to the climate crisis. The U.K. government’s COP26 Envoy, John Murton, has announced the five key points for the Glasgow event: adaptation and resilience mechanisms; the protection and restoration of ecosystems; the transition toward renewable energy; new mobility and transportation; and contribution to the world of finances.

It is expected that steps toward reaching global alliances will continue taking place at the Scottish city. The previous conference, COP25 Chile, held in Madrid, resulted in notable agreements although Article 6 on the regulation of the carbon market was not approved.

BBVA was an active participant in the Madrid event with the bank’s chairman and CEO as prominent participants in the conference. The main building at the bank’s Madrid headquarters, La Vela, was lit in green for the two weeks that the conference lasted. In addition, Celler de Can Roca prepared the menu for the head of state’s first lunch, sponsored by BBVA.

Milestones in the path to Glasgow

But COVID-19 means we will have to wait another year. On April 1, 2020, the heads of the UN, the British government and its Italian partners (the hosts of the pre-COP event) announced that due to the pandemic, the 26th United Nations Climate Change Conference will be delayed until November 2021. The European Commission has assured that it will continue working to raise the EU climate objectives for 2030 despite the delay. “We will not slow down our work. In the long-term, we have committed to climate neutrality by 2050,” declared Frans Timmermans, Executive Vice President for the European Green Deal.

In this vein, the financial world continues its mission to fight against climate change, and to recall and advance in this fight one year prior to the celebration of COP26 (November 9th - November 13th, 2020). Two important events will be held in the path to this conference - both will help to mobilize the commitments of public and private financial institutions in a coordinated manner.

London, the mini-headquarters for COP26

On November 9th to November 11th, coinciding with the original date planned for COP26, the British capital will host the first summit of over 60 global politicians and industry leaders who are anticipating the future and supporting a green international recovery. For three days, the round tables and working sessions will explore how capital can be mobilized at the pace and scale needed to meet not only the U.K.’s commitment to net zero emissions by 2050, but also the international climate commitments.

The Green Horizon Summit will focus on the role of green finance in the post-COVID-19 recovery. "It will be a key milestone en route to Glasgow COP26. It will bring together leaders of finance, business, government and civil society from around the world to showcase innovative finance solutions to accelerate industry’s net-zero transition and for nature-based solutions,” said Klaus Schwab, the founder and executive chairman of the World Economic Forum, an organization supporting this event.

In the second half of the week, Paris will take the baton with the Finance in Common Summit, where public development banks and public finance in line with the Sustainable Development Goals (SDGs) and the Paris Agreement will be the focus.

Paris hosts the Finance in Common Summit

This second event, which will have the support of President Emmanuel Macron, is an initial opportunity to bring together the 450 public development banks to discuss their role, ambitions, challenges and opportunities. The goal for these institutions is to find a joint response to the current crisis, but also discuss measures that should be adopted for a sustainable recovery.

The summit represents a unique occasion to build a new coalition of public development banks and thus facilitate their cooperation in support of joint action for the climate and the Sustainable Development Goals.