Why Leaders Should Care about COP26

If you haven’t had a chance to read Nick Kristof’s last column, “A Farewell to Readers, with Hope,” I highly recommend it. The New York Times Pulitzer-prize winning journalist, who also happens to be an Oregon farmer with 2M Twitter followers, is stepping down to run for Governor of his home state. Lesson #2, that prompted his decision to run, was, “We largely know how to improve well-being at home and abroad. What we lack is the political will.”

He is correct on so many fronts, from poverty alleviation to fighting addiction to the climate crisis. The solutions exist. And yes, the political will is absolutely part of the problem. But what’s behind political will is what citizens, and even more influentially, political donors from interest groups to corporations, want or don’t want. And that is where things get messy.

However, I’ve watched a climate movement gain momentum over the last 11+ years that does seem to be aligning, finally, for real change. What is leading to this increased political will, however imperfect and maddeningly slow, is a fascinating mix of inspiring global activism, primarily by young people, and business leaders, recognizing the significant risks and opportunities that climate change poses, adding their support.

This momentum is why every business leader should pay some attention to COP26, the annual UN Climate Change conference that kicks off tomorrow in Glasgow. Described as “part negotiation, part showcase, part three-ring spectacle,” it’s where government climate negotiators from around the world come together to try to agree on everything from emissions reductions targets to funds for adaptation and mitigation solutions. What they agree on, or not, ultimately sets guidance for what companies will have to do. In advice for what every business leader should know about COP26, McKinsey describes this year’s conference as a pivotal moment.

Leading up to this event have been a dizzying array of announcements from corporations and governments, primarily announcing Net Zero commitments or accelerating timeframes for previous announcements. Prior to this month, about 21% of the world’s 2,000 largest businesses had made Net Zero commitments. This month alone nearly 90 new companies have signed onto the Climate Pledge of Net Zero by 2040 including Salesforce, HP and Procter & Gamble. What was also announced, by SBTi, were much needed new standards for what Net Zero actually means.

What is causing companies to engage so much more now? I saw a fascinating chart this week that surveyed companies on why they are adopting sustainability programs. Number one reason on the list was corporate reputation. Also high on the list were shareholder expectations, customer expectations, managing risk, innovation/business opportunities, and attracting and retaining talent. As WeSpire’s research shows, employees want their companies to be more sustainable and they are increasingly vocal about it. Soon if a company doesn’t have a Net Zero commitment, they will be seen as behind by all their key stakeholders.

That’s not to say that companies are always consistent when it comes to climate. I’ve seen the government relations arm, often through membership in certain associations, actively lobbying against what the company actually needs to hit their climate goals. Many US companies with ambitious climate commitments have stayed silent, or are even seen as obstructing, a budget bill in Congress with ambitious climate components.

So we will see what happens over the next two weeks at COP26, but as Joel Makower, Editor of GreenBiz, hypothesized, “As usual, much of the heavy lift will fall to businesses, responsible for the lion's share of the problem and possessing the means and motivation to fix it. How companies respond to the post-COP moment could be defining — for them, their shareholders, customers and the rest of us.”

Right now, like Kristof, I have hope.