Business Calls on COP28

    Stockholm (NordSIP) – With COP28 in Dubai rapidly approaching, various stakeholders are in a hurry to formulate a clear message to the heads of state and governments attending the upcoming negotiations. This week, an unprecedented gathering of more than 130 companies, collectively representing nearly USD 1 trillion in global annual revenues, joined the choir of voices urging the delegates to set targets and timelines for phasing down and out unabated fossil fuel use and ensure that there are policies in place enabling the rapid scaling of clean energy.

    “We call on all parties attending COP28 to seek outcomes that will lay the groundwork to transform the global energy system towards a full phaseout of unabated fossil fuels and halve emissions this decade,” write the companies in an open letter coordinated by the We Mean Business Coalition, a non-profit pushing for more climate action globally, and its partners through the Fossil to Clean campaign. Notable among the many major signatories are several Nordic companies, such as IKEA, Volvo Cars, Scania Group, Alfa Laval, Fortum, AstraZeneca, Electrolux Group, Ørsted, Elekta, VELUX, and YIT Oyj.

    We can’t do it alone

    “Our businesses are feeling the impacts and cost of increasing extreme weather events resulting from climate change,” write the companies. “We have an important role to play in sending a clear signal about our future energy use, which is rapidly becoming cleaner through renewables.” The signatories note that while they are taking action and working toward phasing out their use of fossil fuels, it is impossible for businesses alone to make this transition securely or efficiently. That is why they are asking heads of state to set policies that hasten the deployment of renewable energy.

    However, the letter is not aimed just at policymakers. The companies also seek the collaboration of financial institutions to ensure that capital is being allocated to accelerate the clean energy transition. The outreach of the signatories includes even fossil fuel producers, urging them to set science-based, net-zero targets and to develop and publish credible transition plans.

    Mind the Global South

    The letter also calls for supporting countries in the Global South in diversifying their energy systems and developing 1.5°C-aligned economic pathways. Crucial for this to happen is “the provision both of finance that does not exacerbate unsustainable sovereign debt, and of capacity-building for just transition planning,” note the signatories.

    This is indeed an important call to make, as evidence seems to point to the opposite development. According, for instance, to a recent report by ActionAid and Profundo, major international banks have provided some USD 3.2 trillion in loans and underwriting to the fossil fuel industry to expand operations in the global south between 2016 and 2022.


    The admirable initiative of the 130+ companies formulating and signing the letter has attracted mostly positive reactions.

    The only catch seems to be the multiple mention of the qualifier “unabated” when applied to phasing out fossil fuel use. Including this important word in a deal means opening up loopholes for fossil fuel production to continue. It implies that power plants, factories, and other industrial facilities can keep relying on coal, oil, or gas as long as their use is paired with controversial new technologies for capturing CO2 emissions that have yet to prove effective at scale.

    Image courtesy of Antonios Ntoumas from Pixabay
    Julia Axelsson, CAIA
    Julia Axelsson, CAIA
    Julia has accumulated experience in asset management for more than 20 years in Stockholm and Beijing, in portfolio management, asset allocation, fund selection and risk management. In December 2020, she completed a program in Sustainability Studies at the University of Linköping. Julia speaks Mandarin, Bulgarian, Hindi, Russian, Swedish, Urdu and English. She holds a Master in Indology from Sofia University and has completed studies in Economics at both Stockholm University and Stockholm School of Economics.

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