Will COP26 make any difference?

As it’s COP26 time, I’m delighted to have a column from Jeff Scott, a co-founder of rewired.earth.

Will COP26 change anything?

I have said a lot about ESG recently and there’s a whole lot more about to swamp the media as COP26 began on Sunday for a 2-week jamboree. The question is, will it make a real difference?

We will have some worthy oratory from global leaders and the unveiling of a $100 billion UN fund to ‘save the world’, all of which should be applauded. But as the detractors will rightly point out a) this is still more words than action 2) it wouldn’t cover the build cost of HS2, let alone save the world.

The issue is Goverments are firefighting the symptoms, but we have a systemic problem, the market is broken. …and people have lost trust.

We need markets to work effectively as they are the most powerful force on the planet for innovation and growth. But to do this they need a reliable, consistent way to measure what individuals want, i.e., to put a value on our values, and directly link it to the way that companies produce goods or governments prioritise projects.

Without global coordination companies are defining their own ESG metrics, the more they do this the more confusing the picture will become and the less trust it creates. There is increasingly no confidence, comparability, consistency, or completeness in the available data, so investors and consumers real requirements are unlikely to be met.

The interconnected nature of everything we do, and the sheer scale of change required to save the planet seems daunting, almost impossible. What we need is a different level of collaboration and thinking to solve this different type of problem.

I came across the work being done by rewired.earth (see attachment) and had a eureka moment…

They have set out a framework which is able to capture what people care about and effectively create the strong ‘demand’ signal that markets need.

Link this to a clear, auditable framework which works at an individual, corporate and country level and we have a functioning market. Treating ESG data in the same way as financial data is essential (IFRS took 50 years to get a common standard, driven by globalisation to enable consistent, auditable measurement of company accounts) … but we don’t have 50 yrs. So, let’s use what is universally accepted, the 17 SDG’s and the business pillars from the World Economic Forum to create a new framework.

Just imagine a world where:

• What people really care about is clear, can be measured and does not need filtering by politicians or corporate entities
• Moral sentiments don't need to replace market sentiments because there is no difference between what the people of the world value and what the market rewards.
• Individuals can directly assess the behaviours and actions of countries and companies against their stated values.
• We don't need to rely on a £100bn global fund to solve all the world’s problems, because the market is leading the way
• ESG ceases to be seen as a business constraint for companies using an alphabet soup of non-comparable metrics.
• People can easily assess the products they buy against what they care about... and can track their own impact on the world in a simple, consistent way.
• Measurement is fact based and auditable, with no competitive advantage (or wasted energy/ resources) on defining the measures.
• Countries and companies are rewarded for saving the planet not destroying it.

By not competing on what should be measured, but focusing on what should be done, by using technology and AI as a global leveller, maybe, just maybe we can change a catastrophic existential risk into one of the greatest opportunities of a lifetime... a true democratisation of sustainability.

Agreeing the rewired.earth framework at COP26, now that would be something that made a real difference.