Irish businesses need to wake up to climate risk reality, COP26 event told

Achieving net-zero emissions is not just about government policy, it is equally about business "doing it itself", according to Mike Hayes, global head of renewables with KPMG.

Ireland had scaled up its climate ambitions "but now it's really about action", he said at an event organised by the British-Irish Chamber of Commerce on the COP26 climate summit next November – Tuesday's event focused on the private sector's role in achieving carbon neutrality.

The UK, in contrast, was by far the best country globally on this agenda, Mr Hayes believes. This was indicated by its embracing of offshore energy and new technologies including green hydrogen in particular. This was being catalysed by the deployment of industrial clusters.

“The big game changer” was the mandatory introduction of climate-related financial disclosures (TCFDs) for public companies to improve and increase reporting of climate-related financial information, Mr Hayes said.

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As a consequence, listed companies have no choice but to think about climate risk. Irish companies needed to wake up to that reality, he said at the online event organised in partnership with Instinctif Partners and the Department for International Trade at the British embassy in Dublin.

A key element of COP26 was implementing "an all-of-society approach" in fully adopting the Paris Agreement, especially by states, cities and businesses, said Nick Baker, deputy director of engagement at the COP26 unit in the UK cabinet office.

‘Key asks’

People often related more to the actions of business in addressing climate change “rather than the abstract notion of national determined contributions” made by states, he added.

The “key asks of business”, Mr Baker said were committing to “net-zero” emissions ambitions by 2050 or earlier; putting in place a short-to-medium term (over five to 10 years) in pursuit of net zero, and signing up to science-based targets (SBTs) backed by independent monitoring of progress, he said.

Already more than 3,000 major businesses, cities and universities globally have joined the COP26 “race to zero” alliances.

The UK, as COP26 hosts, had a range of campaigns in place with a view to reducing emissions. These included clean transport and adoption of electric vehicles, moving away from coal by increasing renewables in power generation and securing increased “green finance” to tackle climate change through technology and funding to increase resilience in countries facing the inevitable consequences of global warming.

Scaled-up finance and improved accessibility to it, especially by vulnerable developing countries, was required, Mr Baker said. Increased funding for disaster response including flood protection was also being pursued, and greater deployment of nature-based solutions, notably in response to deforestation and addressing where this links to beef, coffee and palm oil production, he added.

Science-based targets

Companies were increasingly ensuring their operations were consistent with a scenario of containing temperature rise to 1.5 degrees, confirmed Olwen Smith of the Science Based Targets Initiative In the build-up to COP26, more than 1,500 major companies – representing 20 per cent of global capitalisation – had committed to science-based targets, she added.

Sinéad Hickey, head of sustainability with John Sisk & Son, said it had signed up to SBTs in recognition of the scale of the climate crisis. While “it’s challenging, especially in getting your head around ‘scope 3 emissions’ [arising from supply chains], validation and verification is very important for us”, she said.

Her advice to companies was to act now. “SBTs are not easy. Don’t set targets without milestones and a roadmap. Don’t greenwash. Credibility is critical. And report annually,” she added – it was okay not to meet a target but how it is going to be met should be spelled out.

Ireland's climate envoy, Dr Sinéad Walsh, said a good COP26 outcome would be giving voice to poorer disadvantaged countries and ensuring their representatives were present to contribute to negotiations, and for the Paris pact promise of $100 billion a year for climate-vulnerable countries to be finally nailed down. The recent G7 summit "did not resolve the issue", she added.

While Ireland had the second most ambitious decarbonisation plan in the world, “which can sound very nice”, the reason was not doing enough to date, she added.

While the COP process was often an opportunity for forming alliances and shared learning, it was important that decarbonisation worked in localised circumstances taking into account particular circumstances in a country while ensuring climate justice was also part of the mix, Dr Walsh said.