COP 26

“Our fragile planet is hanging by a thread. We are still knocking on the door of climate catastrophe,” said UN Secretary General Antonio Guterres in a statement on the conclusion of the UN Climate Change Conference COP26. “It is time to go into emergency mode — or our chance of reaching net zero will itself be zero.”

The top goal of COP 26, for world leaders to commit to action plans that will limit average global temperature increases this century to 1.5 degrees Celsius, was not met.

Alok Sharma, the U.K. cabinet minister who oversaw the talks, called the deal a “fragile win,” apologizing for the concession to change wording in the final agreement to “phase down” from “phase out” coal production due to opposition led by China and India.

Canada’s Commitments

Canada made several large announcements. Prime Minister Justin Trudeau announced that Canada is working toward ending exports of thermal coal by no later than 2030, and that the country has joined 20 other nations who agree to no longer finance foreign fossil fuel and gas businesses.

The Prime Minister announced investments of up to $57.5 million to help the world’s poorest and most vulnerable countries adapt to the climate crisis and increase their resilience. Trudeau also championed Canada as a leader in putting a price on pollution and called on all countries to take bold action to expand the use of pollution pricing globally, as currently just over 20 per cent of the world’s emissions are covered by a price on pollution.

Criticism

Early on, Trudeau was criticized for his focus on working towards cutting emissions while not halting oil, gas, and coal production. Green Party Member of Parliament Elizabeth May pointed out in a CBC interview that “the Ministry of Environment is being asked by New Brunswick to give them a loophole so they can keep running coal until 2040.”

In an article in the Georgia Straight, she also criticized Trudeau as either not knowing that “net-zero by 2050 is the wrong target or that he is a knowing party to this fraud.” She writes, “The IPCC findings confirm the reality that we can hold to 1.5 degrees. It is not a guarantee that we can hang on to human civilization, but it is our last, best hope.”

Sustainability

Sustainability is defined as the ability to meet our needs without compromising future generations’ ability to meet their own needs. Sustainability should ensure a balance between economic growth, environmental care, and social welfare.

The corporate world uses the term ESG—Environmental, Social, and (Corporate) Governance—the three key factors socially responsible investors use when measuring the sustainability and ethical impact of an investment in a business or company.

Environment broadly includes energy used, waste generated, carbon emissions and carbon footprint. Residents, the same as businesses, the same as countries, the same as the planet as a whole, must deal with each of these impacts.

Social criteria encompass the web of relationships businesses and organizations work hard to establish and maintain: labour relations, reputation, equity, diversity, and inclusion, as well as relationship with the immediate community. Environmental Learning expert Mitchell Thomashow, in his latest book, writes about how the way societies are moving in this direction can be called cosmopolitan bioregionalism, “an approach that can allow us to construct and navigate fluid sovereignties, adaptive communities, diverse cultural perspectives, shifting ecological boundaries, and multiple narratives of shared belonging.”

Governance, in the context of ESG, according to Market Business News, has to do with how a company is governed, and focuses on:

• Tax strategy
• Executive remuneration
• Donations and political lobbying
• Corruption and bribery
• Board diversity and structure

We can think of the ESG pillars like legs on a tripod: if all three aren’t standing strong, the whole thing will eventually collapse. Things are different now than they have been in the past. Wise CEOs—those that wish to attract and retain talent—will need to pay attention to these issues in more than token ways. The recent 10th annual Deloitte Global Millennial and Gen Z Survey revealed that these groups believe the world has reached a tipping point on issues such as racial justice, inequality and the environment.

More and more, corporations are required to act and support climate change mitigation and adaptation by reducing their carbon footprint and GHG emissions. We can see evidence in this by the announcement made by Mark Carney, the United Nations’ special envoy on climate action and finance. At COP26, he announced the formation of a group of 450 global banks, pension funds, insurance companies, and other finance firms, which pledged to fund the transition to a low-carbon world and to limit global warming.

A Just Transition

One sign of hope is that the Canadian government is in the planning stages of undertaking a just transition of the oil and natural gas sector towards a more sustainable business model. On a site dedicated to gathering public opinion, the federal government claims that “Climate change is the greatest long-term threat of our time, but it is also the greatest opportunity for our economy and workers.” The government has posted a discussion paper and is encouraging people to submit their views.

According to the paper, a just transition involves:

• Preparing the workforce to fully participate in the low-carbon economy [MOU1] [JC2] while minimizing the impacts of labor market transitions;
• Identifying and supporting inclusive economic opportunities to support workers in their communities; and
• Including workers and their communities in discussions that affect their livelihoods.

The timeline stated is to hold virtual stakeholder sessions (by invitation) until September, and to issue a “What we heard” report in Fall 2021. However, the site still appears to be collecting views via email.

Just transition plans have worked in small communities where a plant central to the local economy is to be phased out. The key is to include diverse voices and opinions and work toward consensus-building around community planning, often using an ESG framework. The payoff with the community providing input is that those involved will have shaped the future of where they live and work. Communities usually do not have the resources to undertake these plans without help from the federal government. Retraining programs cost money. And plants that shutter might best be made legally and financially responsible to close for good without leaving lingering pollution. It is good that Canada has started the discussion on just transitions as a precursor to putting a federally backed plan in place, however there is a lot to be considered, tough challenges to face, and key decisions to make.