Illustration by Mia Clement
COP26 is now less than three months away. Scores of world leaders will fly in for the start, and officials from 196 countries will spend two weeks in high-pressure negotiations aimed at setting a new path to a safer climate. COVID-19 has refocused priorities and caused individuals and governments alike to pay closer attention to the environment. As many countries look to rebuild their economies in the wake of the pandemic, there has been a significant emphasis on ‘building back better’ through a green recovery. Floods across Europe and China, wildfires in the US, killer heatwaves stretching into northern latitudes, and extreme weather across the planet give a glimpse into what is at stake. Scientists warn that unless global greenhouse gas emissions are halved in the next decade, temperatures will rise by more than 1.5oC, and the extreme heat, droughts and floods seen in recent weeks will rapidly become the norm rather than the exception with devastating consequences. John Kerry, the United States Special Presidential Envoy for Climate, warned in his landmark speech at Kew Gardens this week: “COP26 in Glasgow [is] a pivotal moment for the world to come together to meet and master the climate challenge … in little more than 100 days, we can save the next hundred years.”
Climate Change and COP26 – Michael Freeman
The International Energy Agency forecast this week that the world’s annual carbon output would reach record levels in 2023, on current trends, because governments are failing to pursue green energy. Emissions at that level would put the 1.5oC goal all but out of reach.
The IPCC (Intergovernmental Panel on Climate Change) forecasts that the planet’s temperature will increase by between 2.5° and 10° Fahrenheit (roughly equivalent to a range of 1.4° and 5.6° Celsius) over the next century. The Met Office projects that, in 50 years, winters will be between 1 and 4.5°C warmer, and summers between 1 and 6°C warmer in the UK alone. Our target, however, as agreed upon in the Paris Agreement of 2015 at COP21 by 196 countries, is to limit the Earth’s temperature increase to below 2° Celsius (ideally to 1.5°) above pre-industrial levels. But since the Industrial Revolution, Earth’s average temperature has risen by 1°C, leaving a margin of only 0.5°.
The figures indicate that we are set to fail this collective target, and the consequences of failure are catastrophic. According to NASA, the sea levels will rise 1-8ft by 2100 and will undoubtedly continue to increase after that, with sea levels taking time to respond to the warming atmospheric conditions. If the increase in temperature levels should extend as far as 2°, a third of the world’s population will be regularly exposed to severe heat, a detriment to health and a threat to life.
This puts the world at a crossroads, making this Conference of the Parties (COP26) in Glasgow, starting on 1st November 2021, of paramount importance. If we are to limit the temperature increase to manageable levels, Alok Sharma, COP President-Designate, writes in the guide to COP26 that, by the second half of the century, we need to produce less carbon than we take out of the atmosphere, thus reaching ‘net zero’ carbon emissions. Achieving this means halving emissions over the next decade. With clean energy now cheaper than fossil fuels in most countries, it should be easier than ever to reduce further damage to the environment. To facilitate this process, the UK government has pledged to halt the sale of new petrol and diesel vehicles by 2030. But we don’t damage the environment simply by emitting carbon. By exploiting land, either destroying it outright through urbanisation or deforestation or failing to afford it due to maintenance and care, we remove a terrain’s natural ability to act as a carbon sink.
It is clear that immediate and decisive action is necessary. Reassuringly, 192 member states of the UN Framework Convention on Climate Change (UNFCC) adopted the Kyoto Protocol in 1997 at COP3, which ‘legally binds developed country Parties to emission reduction targets.’ This legal obligation to the environment was reinforced with the Paris Agreement and by other organisations individually setting their own targets. For example, according to the European Environment Agency (EEA), ‘the EU has set a binding target to cut emissions in the EU territory by 2030 to levels at least 40 % below those in 1990.’
COP26, then, promises to be an important event indeed, with not only pressured negotiations taking place, but also an attempt to integrate environmental awareness into social consciousness through workshops, music, and exhibitions, alongside the endorsement of such public figures as David Attenborough as People’s Advocate. This is a critical step. If we are truly to make a concerted effort to tackle global warming, informed climate conscience must be a factor in daily decisions for us all.
Climate Change and Biodiversity – Mia Clement
UN unveils plan to halt biodiversity loss. The plan states that “urgent political action” is needed “globally, regionally and nationally to transform economic, social and financial models so that the trends that have exacerbated biodiversity loss will stabilise in the next ten years and allow for the recovery of natural ecosystems in the following 20 years”.
The document notes that biodiversity loss will need to be halted by 2030 and a net-positive impact delivered thereafter. The draft plan targets a tenfold reduction in extinction rates and a halving of the risk of species extinctions by 2030.
Biodiversity is the most complex feature of our planet and it is the most vital. “Without biodiversity, there is no future for humanity,” says Prof David Macdonald, at Oxford University. The term was coined in 1985 – a contraction of “biological diversity” – but the huge global biodiversity losses now becoming apparent represent a crisis equalling – or quite possibly surpassing – climate change. More formally, biodiversity is comprised of several levels, starting with genes, then individual species, then communities of creatures and finally entire ecosystems, such as forests or coral reefs, where life interplays with the physical environment. These myriad interactions have made Earth habitable for billions of years.
Biodiversity loss can lead to global warming through the removal of natural carbon sinks, while changes in climate create conditions for further ecosystem decline. This relationship does however also provide an opportunity for climate mitigation efforts through nature-based solutions, a key element in achieving net-zero emissions by 2050 and achieving the objectives of the Paris Agreement.
There is ample evidence that climate change affects biodiversity. According to the Millennium Ecosystem Assessment, climate change is likely to become one of the most significant drivers of biodiversity loss by the end of the century. Climate change is already forcing biodiversity to adapt either through shifting habitat, changing life cycles, or the development of new physical traits. Conserving natural terrestrial, freshwater and marine ecosystems and restoring degraded ecosystems (including their genetic and species diversity) is essential for the overall goals of both the Convention on Biological Diversity and the United Nations Framework Convention on Climate Change because ecosystems play a key role in the global carbon cycle and in adapting to climate change, while also providing a wide range of ecosystem services that are essential for human well-being and the achievement of the Millennium Development Goals. Biodiversity can support efforts to reduce the negative effects of climate change. Conserved or restored habitats can remove carbon dioxide from the atmosphere, thus helping to address climate change by storing carbon (for example, reducing emissions from deforestation and forest degradation). Moreover, conserving intact ecosystems, such as mangroves, for example, can help reduce the disastrous impacts of climate change such as flooding and storm surges.
Ecosystem-based adaptation, which integrates the use of biodiversity and ecosystem services into an overall adaptation strategy, can be cost-effective and generate social, economic and cultural co-benefits and contribute to the conservation of biodiversity. Conservation and management strategies that maintain and restore biodiversity can be expected to reduce some of the negative impacts from climate change; however, there are rates and magnitudes of climate change for which natural adaptation will become increasingly difficult. Ecosystem-based adaptation uses biodiversity and ecosystem services in an overall adaptation strategy. It includes the sustainable management, conservation and restoration of ecosystems to provide services that help people adapt to the adverse effects of climate change.
The Finance of Climate Change – Duarte Amaro
As scientists continue to reinforce the severity of climate change, the potential disruption and financial implications have come to the forefront.
The risks posed by climate change are no longer regarded by financial institutions purely as reputation risks, dealt with through the lens of corporate social responsibility (CSR). Instead, climate risk has become a financial risk and, according to management consultancy Oliver Wyman, “institutions need to integrate climate risk into their financial risk management frameworks”.
Climate change’s impact on the financial system takes place through two main channels. Physical risks include damage to property, infrastructure and land resulting from climate change: for example, the effects of increasingly frequent floods or wildfires. On the other hand, transition risks arise from changes in policy, technology and consumer sentiment as the economy adjusts to a lower-emissions paradigm. Financial institutions exposed to firms with business models at odds with a low-carbon economy will incur transition risks. Compared to those of clean energy companies, for example, the share prices of US coal mining companies have been underperforming, harming their stockholders.
According to the European Central Bank, about a third of the eurozone banking system credit exposures to non-financial companies (NFCs) are to companies subject to high or increasing physical risk. Exposures to manufacturing firms, in particular, represent a major source of transition risk in banks’ corporate loan portfolios as their level of indirect emissions make them especially vulnerable to changes in consumer preferences. Non-banks, on the other hand, invest around €1.6 trillion in securities issued by high emitters – about 30% of their portfolios.
These risks are shocks to the economy, but financial-system vulnerabilities may amplify their negative effect in a cascade of consequences. A possible concentration of physical risks among a few, more vulnerable banks could have wider implications for the financial system. In addition, investors have limited information regarding the climate exposures of financial institutions and NFCs; as such, asset prices may not fully reflect their underlying climate risk. When prices rapidly adjust after unexpected realisations of these risks, financial stability may be threatened.
Because of this, prudential regulators have begun to incorporate climate risks into their stress tests of insurance firms. According to an Oliver Wyman survey of 45 global financial institutions, around 18% perform climate scenario analysis and/or climate stress testing, with about a quarter of the surveyed institutions currently working on integrating climate scenario analysis. But the exact timing and magnitudes of future climate outcomes remain uncertain, and accurately measuring climate risks is still difficult. It is partly to remedy this that US President Joe Biden recently issued an Executive Order on Climate-Related Financial Risk, aiming to “advance consistent, clear, intelligible, comparable, and accurate disclosure of climate-related financial risk […], including both physical and transition risks”.
Climate change, however, represents risk as much as opportunity. The necessary global investments required for addressing climate change are estimated in the trillions of US dollars, and most of these will be intermediated through the financial system. It can mobilise the resources needed for investments in climate mitigation and adaptation, addressing both physical and transition risks.
The Geopolitics of Climate Change – Chris Conway
Climate change poses a number of collateral threats to humanity. Perhaps the major one is forced migration. Migration was a defining issue in the major political events of the 2010s, such as Brexit, or Trump’s election on the promise of building The Wall.
The migrations these movements responded to were sizeable. 2015, which the UN Refugee Agency calls ‘the year of Europe’s refugee crisis’, saw more than 911,000 estimated arrivals on European shores.
Yet these would be dwarfed by the climate-fueled migrations currently being projected. Central American migration may serve as the canary in the coal mine. Mexico saw dramatic social tension as a result of central American migration in 2018-19. In Ciudad Hidalgo, tensions between locals and immigrants resulted in a 45% jump in armed robberies and 15% in murders. Where northern Mexican states experienced GDP growth as high as 11%, the southern Mexican state of Chiapas, facing the new waves, experienced a 3% drop. These changes occurred due to a migration of hundreds of thousands, 728,000 in 2016 (the year of Trump’s election). Climate change threatens different levels of migration altogether. One model (albeit at the higher end) estimates that in the 2080s, 6.7 million Mexicans alone could be on the move. These social fissures will threaten to produce dramatic political realignments far beyond which we saw in the mid-2010s.
Then we turn to the more important issue of life within the critically affected areas, such as Central America, South Asia or Central Africa. The World Bank has estimated that more than 140 million people will be internally displaced owing to climate-related reasons by 2050, accelerating stress upon national infrastructure, starting new conflicts, exacerbating others, and continuing the cycle of forced emigration.
Resource conflicts also threaten to proliferate. Many wars already can be traced back to climate-related issues, such as the drought which intensified Arab-black rivalries into full-scale war in Darfur from 2003. Available evidence shows that climate change will not supplant existing rivalries – and potentially encourage the building of new alignments or loyalties – but rather exacerbate them. A pair of studies from 2013 found that a single deviation point away from average in temperature and rainfall – less than half the predicted change for some geographical regions by 2050 – led to a rise of 14% in civil conflict. States with poor infrastructure and governance will struggle to prevent and mitigate these patterns. These might very well sink into the status of failed states, exacerbating global inequalities and stunting development in areas with bright potential, such as Nigeria or the Nile basin.
Climate causes remain subject to the ability of states to engage with the issue, and to cooperate or compete. China is now responsible for more greenhouse gas emissions than the entire developed world. That said, Chinese figures continue to drag their feet over climate policy and challenge any American “climate crusade” as hypocrisy.
Governments are alive to the issue: just last year, US President Biden’s National Security Advisor called climate change an ‘urgent national security priority’. However, it is unlikely we will see humanity truly pull together on climate change – a global phenomenon requiring a global response. A salient point is often raised by developing nations when Western countries push them to curb emissions and cut reliance on fossil fuels: who are the Western moralisers – responsible for half of all carbon emissions since 1850 – to turn around now and dictate how they develop?
Divorcing climate policy from international rivalries and encouraging climate cooperation across geopolitical fault lines will require Herculean effort. It is a challenge that has to be overcome if humanity is to successfully mitigate the effects of global climate change. If there is to be one overriding goal for our diplomats of tomorrow, this is it.
The effects of climate change are as alarming as they are diverse – and we’ve covered but a speck of the potential impacts. Threatening biodiversity, destabilising our financial system or proliferating conflict across the world are just three of the many disconcerting consequences of climate change. Witnessing the increase in the frequency and brutality of floods, wildfires, and heatwaves, it should come as no surprise that limiting the increase in the Earth’s temperature to 2º Celsius above pre-industrial levels is crucial. As an assembly of world leaders from 194 countries, COP26 is one of the few moments where global action can be taken. It truly is direly needed.