Dynamic, hope-inducing, but too soon to claim victory: Torbjorn Caesar’s takeaways from COP28

I have recently touched down for a business trip to China following a whirlwind week in Dubai at COP28. And as I write this, great news has broken through from COP, with an agreement reached that calls for a move away from fossil fuels for the first time. This alone makes this COP different to previous editions.

But there are other reasons why this COP was unique, relating to the scale and energy on show at COP28. This has been fantastic.

The private sector mobilised for climate action

Never has a COP summit been so well attended and the fact that the business community has turned out in such numbers is hugely positive. Actis led from the front in this regard, bringing a strong team to Dubai to represent the sustainable infrastructure agenda.

Since Glasgow, we’ve seen the private sector increasingly show-up for COP, with real intent to get business done. Investors globally now recognise what Actis has been saying for years – that the climate transition represents an incredible investment opportunity. The transition is the predominant investment theme of our time and COP28 offered the opportunity to accelerate private and public capital investments into the businesses driving the transition and decarbonising the global economy.

At COP28, business meant business and came to get deals done. And this is critical, because we need to unlock climate finance, particularly in the growth markets Actis operates in – this is what we work to do every minute of every day. When it comes to this and the conversations I’ve been having on the ground in Dubai with other senior figures from the political and business world, this has been a COP of real substance.

The genuine commitment I’ve seen from the private sector to investing in sustainable finance and putting money to work in the climate transition is brilliant. And this should only continue as the investment case for such solutions becomes ever-more compelling, with new technologies scaling to commercial viability with every passing year, helping the drive toward net zero and sustainability more widely.

Taking a holistic view on climate change

For several editions of COP, the focus has been on accelerating decarbonisation and the transition to net zero – quite rightly. While this remains front of mind, it’s a positive development that more and more stakeholders are thinking holistically about climate change, not only working to avoid it but take climate risks, adaptation and resilience into account as well as considering loss and damage.

COP28 delivered significant progress on this. The debates have increasingly focused on these factors and one of the landmark achievements of this COP has been the agreement reached by national governments to launch a loss and damage fund for countries worst affected by climate change. This is a historic agreement and, while its funding pledges will need to be followed and built on, it offers real hope.

The landmark Global Decarbonisation Accelerator agreement secured at COP28 is also great cause for optimism. This saw more than 100 countries sign up to an action plan designed to put the global economy back on track with the 1.5C pathway of the Paris Climate Agreement by tripling renewable generation capacity to a minimum 11,000GW and doubling the average rate of energy efficiency improvements by 2030. Such targets are absolutely achievable with the right alignment of policies and investment, as we’ve seen in countries like India, so governments must now work with businesses and NGOs to make this happen.

Finishing the job

Although the tremendous dynamism and action I’ve personally witnessed at COP fills me with hope, perhaps the greatest relief has been the news of an agreement reached on the morning of 13 December (the day after COP had officially ended).

The investment community, and indeed the world, needed countries to come to an agreement that represents genuine progress on climate change – and it looks like this agreement goes in the right direction. Like most international agreements it is imperfect and has required compromise but it does call on all countries to move away from fossil fuels for the first time. It’s a good step and gives the world something to build on further but it’s too soon to claim victory.

A strong agreement at UN level trickles down to better government policies to accelerate the transition and therefore more investments into the climate solutions that deliver it. This is particularly true in the growth markets Actis operates in, where 85% of the world’s population lives, where the sun shines and wind blows most, and where the transition can have the greatest impact on future emissions. Actis is playing its part and will continue to do so. Let’s hope the world’s governments do likewise.