From Paris to New York: Acceleration of climate action

Reading time: 3 minutes
21 September 2016

This post first appeared on CDP's website.

Ban Ki-Moon’s ratification event in New York today brought the Paris Agreement one step closer to entering into force in 2016. Now exactly 60 countries have ratified the deal, representing nearly 48% of global greenhouse gas emissions. And many more leaders promised to join the deal this year, notably Miguel Arias Cañete, EU's Commissioner for Energy and Climate Action, who told the UN audience: “It’s very simple: The European Union must join the Paris Agreement this year.”

The speed of this legal process has been unprecedented. But given the growing evidence of climate change impacts, are we yet moving fast enough to transform the global economy?

Achieving the Paris goals will require a systematic economic transformation away from fossil fuels. This is now starting to happen: the cost of renewable energy keeps falling, investors are increasingly looking to decarbonize their portfoliosand are developing low-carbon indices and green financing products, and China will introduce next year the world’s largest carbon market.

Disclosures to investors made via CDP in 2016 show that more than 600 companies are factoring the Paris goals in to their business planning and strategies. UK’s Anglo American said: “For Anglo American the Agreement provides further signals that the global economy is becoming increasingly carbon constrained and as such we need to continue with efforts to reduce our direct and value chain emissions in order to remain competitive and sustainable.”

Here are five ways that this is ALREADY affecting companies:

  1. There is a global level playing field, meaning that companies all over the world can now expect regulation of greenhouse gas emissions.
  2. There is long-term policy certainty. Companies have been asking for it for years and now it’s here! The direction of travel is now clear and the goals are ambitious.
  3. Companies can more confidently make low-carbon investment decisions. More than 1,200 companies are now using an internal price on carbon, an increase of 23% from last year.
  4. The world is behind the Paris Agreement and this will affect consumer attitudes to brands and companies. UK’s Kingfisher said: “Customer will expect the business community to play its part in making COP 21 a reality, with much of the spotlight being placed on the global supply chain, and the labour and environmental standards within it.”
  5. Paris set science-based emissions reduction goals and companies will be expected by their stakeholders to be similarly ambitious, setting Science Based Targets.

With the Paris Agreement looking set to enter into force before the end of 2016 and perhaps even by the COP22 meeting in November, it is time for companies who have not yet integrated climate change into business planning to join the low-carbon revolution – join us!

– Kate Levick, director of policy and regulation, CDP | @KateLLevick

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