United Nations’ Intergovernmental Panel on Climate Change (IPCC) report
In the wake of the recent report from the United Nations’ Intergovernmental Panel on Climate Change (IPCC), Summit Strategy Group Senior ESG Analyst Richa Agarwal offers her insights into the future direction of the ESG landscape.
The findings in the latest IPCC report are not surprising. Science is precise — the average global temperature is likely to rise by at least 1.5°C above pre-industrial levels by 2040. The situation is dire, and the report is necessarily alarming. Investor communities, businesses of all sizes, different levels of governments and international agencies must play their part in limiting the worst effects of climate change.
Some trends we expect following this report include:
More substantial and mandatory climate disclosure: The IPCC report will boost the momentum behind a push for more robust climate change disclosure and accountability from the global business community. This will likely evolve to include mandatory, regulated climate financial disclosure from corporations.
Revisions in climate strategy: Changes in climate strategies by businesses, investors, and governments on mitigating and managing climate risks will be necessary. These changes will likely reflect aggressive carbon targets and initiatives to achieve them, newer decarbonization and clean energy-focused projects, and updated risk-based analysis mechanisms from the investor community. Governments may revise policies and commitments with the COP 26 UN Climate Change Conference in Glasgow coming up in November.
The effects of climate change are far reaching, impacting biodiversity, water security, community resilience and public health. Effective solutions require inclusive and collaborative engagement.