Companies at COP27: clean air is a catalyst for climate action

Progress by global political leaders and international organisations on fossil fuel use at COP27 was disappointing, but news about progress on air pollution from corporate leaders gathered at Sharm El-Sheikh brings cause for cautious optimism.

“We don’t have any time to waste. Our window for action is rapidly closing, and we cannot let national governments off the hook”, noted Michael Bloomberg in the first days of the recent UN Climate Conference (COP27). In a joint opinion piece with European Climate Foundation’s Laurence Tubiana, the UN Special Envoy and former mayor of New York City recalled: “Back in 2017, when […] Trump’s administration moved to pull the federal government out of the Paris Climate Agreement, a broad coalition of U.S. cities, states and businesses stepped up to say: We are still in.”

Fast forward to today and non-state actors, such as city leaders, businesses and civil society, are still showing leadership beyond that of nation states. City mayors are committing to climate targets and backing them up with implementation. On the other hand, businesses have been strong on commitments but have recently been criticised for their rigour – or lack thereof. So, are businesses still part of the coalition that is stepping up, in contrast to the slow progress made by governments?

The We Mean Business Coalition articulates why businesses commitments are needed: “the potential benefits of bold climate action [for the corporate sector] are significant, while the risks associated with inaction are cause for great concern.”

The economic case for acting on climate change is strong. The Global Commission on the Economy and Climate report showed that decarbonisation creates jobs and unlocks new opportunities. Gross domestic product (GDP) and carbon emissions are no longer seen as inextricably linked.  Scientists and academics have demonstrated this de-coupling with examples of thriving economies associated with declining emissions.

Businesses also see value in communicating the co-benefits of reducing emissions – not least that many climate solutions also reduce air pollution. With most cities exceeding World Health Organization air quality guidelines, pollution is experienced first-hand by employees and customers, wherever they are. Almost everyone can grasp where air pollution comes from, knows that breathing in pollution is unhealthy and understands that it is possible to reduce air pollution almost overnight with concerted action, especially since COVID-19 lockdowns showcased how clear the air can be.

According to the Confederation of British Industry (CBI), in the United Kingdom alone, it would be possible to prevent 17,000 premature deaths each year and for businesses to benefit by £1.6bn annually if the air quality met the WHO guidelines.

From sustainable growth in Africa’s megacities to jobs and industry in India, research shows how tackling air pollution produces enormous benefits for the climate, economies and people simultaneously.

But thinking and action on climate and air pollution are still too siloed. Dirty air is closely linked to climate change. Both are mainly caused by burning fossil fuels and share some of the same solutions, so cleaning our air is one of the most immediate ways to protect the planet.

One of the most encouraging sessions at COP27 was a panel of business leaders who are part of the corporate Alliance for Clean Air. Leaders from Inter IKEA Group, pharmaceutical company GSK, Google and shipping company Maersk discussed how – and why – to take action on air pollution, reflecting on a year of building their understanding of air pollution emissions across their value chains and how this work complements their climate strategies.

The 16 major multinationals that have joined the Alliance for Clean Air are the first movers, adopting measures to reduce air pollution even in the absence of regulatory pressure to do so. They are also starting to measure their progress. These trailblazing companies have invested in developing a clear, quantified inventory of emissions. Measuring air pollution emissions at this scale is new. The data is not easy to face but these businesses have acknowledged that you can’t manage what you can’t measure.

Their work has been made possible by a first-of-its-kind practical guide on how to measure air pollution across corporate value chains, which was launched at COP27, having been developed by the Stockholm Environment Institute (SEI), Climate and Clean Air Coalition (CCAC) and Inter IKEA Group. Reporting air pollution emissions will enable increased transparency and accountability, and help focus action. This corporate ‘airing of dirty laundry’, as one corporate executive on the COP27 panel described it, is also an opportunity to encourage more businesses to face and address their air pollution footprint.

For those businesses that need help making the decision to address dirty air, the Clean Air Fund partnered with the World Economic Forum and Accenture to produce a new business action toolkit. This framework provides companies with everything they need to know to make the business case for clean air, including how to integrate clean air into existing climate and environmental, social and governance (ESG) strategies.

These tools for measuring and reporting on air pollution are part of a wider movement to increase scrutiny and, ultimately, real action. For example, the International Organization for Standardization has introduced new target-setting guidelines and a UN expert group has produced recommendations to stamp out greenwashing and encourage meaningful change.

Businesses that are wondering whether all this voluntary effort is worth it would be wise to pay heed to regulations coming down the tracks. In parallel to COP27, the European Parliament voted to bring in mandatory air pollution reporting for businesses larger than 500 people by 2024 and for businesses larger than 250 people by 2025.

Beyond driving transformation in their own industries, businesses can use their wide-ranging influence to accelerate action on climate and air pollution by reinforcing an ambition loop between business and policymakers. Where voluntary action from businesses gives evidence and confidence to lawmakers to create regulation, regulatory certainties propel more businesses to invest in clean air, and the ensuing reforms support increased ambition from governments to accelerate the transition to clean energy and transport.

The collective influence of business is powerful. When asked if keeping warming at 1.5°C was possible, John Kerry, Special Presidential Envoy for Climate from the US State Department, replied: “I believe it is, but the only way to do it, is to massively bring the private sector to the table.”

By working together, businesses – along with government and civil society – have the power to make real change. By working on air quality and climate change mitigation in parallel, they can catalyse fairer, cleaner growth and prosperity around the world.

The views expressed in this #CriticalThinking article reflect those of the author(s) and not of Friends of Europe.