Business leaders must lead the fight against climate change

COP26 showed that climate change is a project too big for any one government: business leaders must take the lead

Business leaders must lead the fight against climate change
Credit: Pixabay

COP26, the 2021 UN Climate Change Conference, ended with a disappointing outcome, to put it mildly. However, history shows that corporations can better organise and carry out tasks too big for one person. Or even one government. Here are a few thoughts about a way forward to get us out of the mess we found ourselves in.

The outcome of COP 26

At COP26 197 parties agreed to the “Glasgow Climate Pact”. There were some achievements. Countries committed themselves to further accelerating their decarbonisation plans. And to strengthen their emissions-reduction targets for 2030 by next year. (Rather than in 2025 as per the five-year schedule set out under the Paris agreement.)

Developed countries increased funding for adaptation in developing countries. Rules to create a framework for a global carbon market got approved. The need to reduce global greenhouse-gas emissions by 45% by 2030 got recognised. “Not the stuff of triumph; but not a trainwreck, either” argues the Economist.

I think COP26 ultimately showed that a country government, whatever the system (democratic, communist and anything in between), cannot do the job when it comes to global issues. Business leaders must lead the fight against climate change.

The most trusted institution

When the government is absent, people expect business to step in and fill the void, according to the Edelman Trust Barometer (2021). This shows that there are high expectations of business to address societal challenges. They bring CEOs new demands to focus on these challenges with the same rigour, thoughtfulness, and energy used to deliver on profits.

The study shows that people trust business the most among the four institutions in scope (Business, NGOs, Government and Media) and they see business as the only one both ethical and competent. But it also shows that no leader is trusted to do what is right – [large business] CEOs’ credibility is at all-time lows.

I do not expect all businesses to join the fight. Some like coal, oil and gas pure-plays cannot. European energy firms seem to genuinely reposition as renewables providers. I welcome this but I will keep an eye on their next steps. I believe that most businesses will join and bring the change needed.

Final thoughts

At COP26 major governments (apart from the EU perhaps) have disappointed, even if the expectations were low. Now, business leaders must lead the fight against climate change. Not only the ones in charge of larger businesses but also the entrepreneurs chasing their dreams.

This is the time for the many Steve Jobs out there (starting up or growing large businesses) to come up with visions that inspire people around the world and lead them to a new, sustainable lifestyle, with honest, positive messages. I count on the younger ones, in particular.


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Mauro Tortone

View posts by Mauro Tortone
Mauro advises financial services, technology and mobility businesses and leads the Strategy & Finance practice. His expertise is in strategic change, capital markets and more. Mauro has over 25 years of experience working with banks such as UBS and Deutsche Bank, smaller financials, fintechs and others across Europe, the US and Asia. He sat on the CISI Corporate Finance Forum Committee for ten years and is passionate about sustainability.
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