Welcome to the first issue of “Global Sustainability Agenda” – a newsletter coming out weekly on Sundays to present the summary of stories and discussions about ESG, corporate sustainability, energy transition, business net zero, and the path forward for businesses who want to pioneer a more sustainable reality for themselves.
This newsletter aims to equip business leaders, board members, and sustainability executives with the most recent information yet necessary knowledge to drive corporate decisions toward an economically, environmentally, and socially sustainable future.
In this section, I bring the weekly climate change events, which are shaping the future of our planet, and the global leaders’ agenda toward a more sustainable economy to address climate change impacts. In the business context, this translates into risks to supply chains, unexpected investments, access to capital, governance, and others.
So, what happened this week?
China will impose tighter standards on voluntary carbon credits as it revives its long-stalled offsets market. New China Certified Emissions Reduction credits, or CCERs — which reward activities that help avoid or remove the release of greenhouse gases — may be issued later this year as the Ministry of Ecology and Environment gets new legal powers. (Bloomberg)
Carbon offsets have recently been under scrutiny for their legitimacy and efficacy, resulting in a credibility crisis for the market. Issues surrounding verification mechanisms and a lack of trust have significantly impacted the market. (Financial Times).
In this section, I discuss the potential consequences of Global Sustainability Reality to businesses and the path forward, including corporate strategies, business model innovations, ESG, and signals from the market that can help shape your company’s sustainability agenda.
Here is a summary of useful content that can shape your company’s or board’s discussions and allow you to evaluate what is best for your business in the context of sustainability.
Many companies, including tech giant Apple, are championing their carbon-neutral products, but there’s rising skepticism about the authenticity of such claims. Notable instances, like a recent investigation published by The Guardian revealing 90% of rainforest carbon offsets were worthless, and Delta Air Lines facing a lawsuit for questionable carbon offsetting programs, underline the problem. (Financial Times)
Offsetting has been hailed as a fix for runaway emissions and climate change—but according to studies the market’s largest firm sold millions of credits for carbon reductions that weren’t real (The New Yorker).
More than 50,000 companies must start assessing the impact of their operations on the environment from January after EU lawmakers overcame rightwing opposition to pave the way for the reporting requirements that will also catch multinational companies (FinancialTimes).
Regulatory bodies and governments are urged to treat Carbon Markets not merely as a marketing compliance issue but as a serious market that requires robust regulation similar to financial markets. The need for a well-resourced oversight body is paramount to restore trust in carbon offsets.
Imagine a world where third-party organisations took sole responsibility for auditing and verifying a company’s financial statements, with no official oversight or legal repercussions for foul play.
Would investors feel comfortable in such an environment? Most likely not, as the risk of misinformation would be far too high, undermining trust and severely compromising the efficient allocation of capital.
Similarly, without rigorous regulation the carbon offset market will face a severe risk of lack of credibility.
Carbon offsets are still a great oppoutnity to combat climate impacts, but they must be well regulated. Implementing such reforms is crucial for the global sustainability agenda and it needs to be done immediately, otherwise the path toward a net-zero economy will remain a dream.
Beatriz Canamary is a consultant in Sustainable and Resilient Business, Doctor and Professor in Business, Civil Engineer, specialized in Mergers and Acquisitions from the Harvard Business School, and mom of triplets. Today she is dedicated to the effective application of the UN Sustainable Development Goals in Multinationals.
She is an ESG enthusiast and makes it possible to carry out sustainable projects, such as energy transition and net-zero carbon emissions. She has +15 years of expertise in large infrastructure projects.
Member of the World Economic Forum, Academy of International Business and Academy of Economics and Finance.
