The latest insights from the We Mean Business coalition

Signals of Change – December 2024

COP29 is behind us, but the outcomes of the summit will resonate into the future. The final texts marked a turning point on climate finance: the New Collective Quantified Goal on Climate Finance (NCQG) of ‘at least’ $300bn a year was a modest step forward, and many developing countries were unhappy with the deal, but the inclusion of an additional $1 trillion target to scale up private sector investments by 2035 offers a bold signal that climate finance will scale to meet the challenge of the climate crisis. However, the lack of explicit commitments on fossil fuels was a failure of leadership. The onus now rests with individual countries to go home and put this in their new NDCs to ensure they send strong signals on how their policies will accelerate the clean energy transition and attract greater private sector investments.

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Final texts aside, we saw many examples of business and government progress towards tackling the climate in Baku – as outlined in our COP signals special – and beyond this year.

From groundbreaking corporate partnerships in clean energy and supply chain decarbonization, to ambitious new national climate commitments and landmark laws, here are some of the positive signals of change from 2024 towards a more sustainable future…

A JUST TRANSITION FROM FOSSIL FUELS TO CLEAN SOLUTIONS

The momentum of the clean energy transition is unstoppable, and we saw examples of business action, innovation and collaboration – and enabling government policy – in support of the shift from the fossil fuel era across all sectors.

In March, a change in US tax policy under the Inflation Reduction Act (IRA) promised to provide a substantial boost to renewable energy projects. A new tax credit transferability mechanism enabled companies to transfer their tax credits to other entities. The change is estimated to have generated $7 to $9 billion of funding for renewable projects over six months and could reach $83 billion by 2031.

In June, Google launched a first-of-its-kind clean energy partnership with NV Energy, centered around the implementation of its Clean Transition Tariff (CTT) in support of using carbon-free energy 24/7 by 2030. The new model empowers large energy consumers to invest in emerging clean technologies, and sparked a collaboration between NV Energy and Fervo Energy to bring 115 MW of enhanced geothermal power to Nevada’s grid.

Investment into a sustainable built environment is changing the way we heat, cool and power buildings. In November, IKEA pledged to invest $1.6 billion towards retrofitting 150 units with energy-efficiency upgrades, in line with the company’s aim to reduce its climate footprint from operations by 85% by 2030.  Meanwhile, in August, construction company Multiplex implemented cutting-edge sustainability measures in its $1 billion Canberra Hospital redevelopment, creating Australia’s first fully-electric hospital building.

Green materials are the bedrock of sustainable construction, and 2024 brought a surge of innovation and investment to this sector. In April, Swedish steelmaker SSAB announced it would invest €4.5 billion into building a fossil-free steel mill. Meanwhile, in Namibia, the HyIron-Oshivela project is set to begin production by the end of the year, utilising innovative ‘Iron-to-Hydrogen’ technology powered by renewable energy to decarbonise steel production.

The cement and concrete sectors are similarly advancing. In June, the UN’s industrial development body partnered with the Global Cement and Concrete Association to support the decarbonization of the sectors across the globe, with a strong focus on the Global South.

Moving to transport, the year saw significant growth in the electric vehicle sector, with China rapidly gaining global market share through its export of affordable and high-quality electric vehicles (EVs).

This boom in EV production is contributing to a shift in China’s emissions trajectory, with experts now cautiously optimistic that the country may reach its emissions peak by 2025, as it continues to scale up its green energy and EV production.

LATEST FROM THE COALITION

Read our key insights from the past month, including:

• Highlights from the We Mean Business Coalition pavilion at COP29
• We Mean Business Coalition welcomes ICVCM approval of three REDD+ methodologies for VCM to accelerate credible nature investment
• For Patagonia, phasing out fossil fuels means “getting the oil off our backs”

PROTECTING AND RESTORING NATURE

One of the biggest stories for nature came in June, with the EU’s landmark Nature Restoration Law entered into force. The historic legislation aims to reverse biodiversity loss, mandating the restoration of at least 20% of the EU’s land and sea by the end of the decade.

The growing recognition of carbon markets as a tool for climate action is spurring investment in nature-based solutions. In May, tech giants Google, Meta, Microsoft, and Salesforce launched the Symbiosis Coalition, committing to purchase up to 20 million tons of  high-quality nature-based carbon credits. In the same month, the Biden administration outlined new guidelines defining high-integrity offsets, to ensure projects deliver genuine emission reduction

The recently concluded UN Biodiversity Conference (COP16) in Cali, Colombia, saw significant progress for Indigenous Peoples and local communities, as well as people of African descent, who were recognized as key drivers of nature conservation efforts. Delegates agreed to establish a subsidiary body that will include Indigenous Peoples and local communities in future decisions on nature conservation. Additionally, the conference introduced a new global fund for conservation efforts. The Cali Fund is expected to raise $1 billion annually by requiring corporations to share a portion of the profits they generate from genetic data derived from nature.

The ambitious decisions were spurred in part by increasing business calls for action. Ahead of the conference, more than 130 companies, including major firms like Danone, H&M Group, and Unilever, called on governments to adopt strong strong policies on nature protection and restoration.

POLICY PROGRESS TOWARDS NET ZERO ECONOMIES

During COP29, COP30 host Brazil upped its climate ambition, with a new NDC commitment to reduce its greenhouse gas emissions by 59% – 67% by 2035, relative to 2005 levels. The target represents a reduction of 850 million to 1.05 billion tons of carbon dioxide equivalent by 2035. The UK also committed to an ambitious new NDC, pledging to reduce its emissions by 81% by 2035, based on 1990 levels. This goal aligns the country with a pathway towards net zero by 2050.

During the conference, Mexico committed to achieving a net zero economy by 2050, marking a fresh bid by the country’s new president to more aggressively confront the climate crisis. The declaration means that among the world’s 15-largest emitters there’s now just one — Iran — that has yet to commit to a net zero target.

DECARBONIZING GLOBAL SUPPLY CHAINSs

In a major milestone for supply chain action this year, US retail giant Walmart achieved its goal of eliminating 1 gigaton of supply chain emissions six years ahead of its 2030 target. The initiative, known as Project Gigaton, engaged over 5,900 suppliers in efforts to cut emissions through measures like improving packaging, optimizing energy use, and reducing waste.

In June, British supermarket Lidl partnered with WWF on a five-year supply chain program to enhance conservation and biodiversity across 31 countries, aiming to halve the environmental impact of its food products. The initiative focuses on improving supply chain traceability, responsible sourcing of key materials, and eliminating deforestation while encouraging suppliers to adopt science-based targets.

Meanwhile, in July, Google announced plans to push its largest hardware manufacturing suppliers to commit to 100% renewable energy by 2029 through its Renewable Energy Addendum, as part of its broader 2030 goals to reach net zero emissions across its operations and value chain.

FINANCE: REGULATION AND STANDARDSF

Early in the year, China’s major stock exchanges, including the Shanghai Stock Exchange, Shenzhen Stock Exchange, and Beijing Stock Exchange, announced new sustainability reporting guidelines for listed companies. The rules require hundreds of the country’s largest and dual-listed firms to disclose on a broad range of ESG topics, starting in 2026, and include reporting on Scope 3 value chain greenhouse gas emissions.

Following a lengthy legislative process, the European Council adopted the Corporate Sustainability Due Diligence Directive (CSDDD) in May, requiring large companies to establish risk-based systems to monitor and mitigate environmental and social impacts. The directive was hailed as a crucial tool for holding companies accountable as we transition towards a more sustainable and just economy.

In the same month, the IFRS Foundation reported that more than 50% of the global economy, covering 20 jurisdictions and representing nearly 55% of global GDP, are adopting or aligning with ISSB disclosure standards, marking significant progress toward a consistent global framework for corporate disclosures.

Finally, last month the International Auditing and Assurance Standards Board launched the International Standard on Sustainability Assurance 5000 (ISSA 5000). The standard aligns with major sustainability frameworks like the EU’s CSRD, the ISSB and the GRI. It aims to strengthen stakeholder confidence in ESG reporting and standardise reporting practices globally.

DEEP DIVE:

Read our long-form analysis of the COP29 outcomes across key themes, including what they mean and what’s next on the road to COP30.

Read the deep dive analysis

COMPANIES TAKING ACTIONc

Over 18,200 companies are taking action through Coalition partner initiatives. See all companies who committed in the past month on the We Mean Business Coalition website. Companies setting their ambition for net zero include:

• 9,462 companies working to cut their emissions in line with science through SBTi
• 8,788 small and medium-sized enterprises working to cut emissions with the SME Climate Hub
• 526 companies who have now signed the Climate Pledge, to reach net zero by 2040

Meanwhile, companies are driving down emissions through the following demand-side initiatives:

• 130 companies are accelerating the transition to electric vehicles with EV100, and 5 companies are kickstarting the transition to zero-emission medium- and heavy-duty vehicles with EV100+
• 129 companies are committed to improving their energy efficiency through EP100
• 336 companies have committed to 100% renewable energy with RE100
• 39 companies have joined ConcreteZero to create a market for net zero concrete
• 45 companies have committed to SteelZero to create a market for net zero steel

EVENTS

Davos – 20 – 24 January

CERA Week – 10 – 14 March

COP30 – 10 – 21 November

G20 – 22 – 23 November

CAREERS

Various posts at BSR Various posts at CDP

Various posts at Ceres Various postsat CLG Europe (CISL)

Various postsat Climate Group

Various postsat WBCSD

Various postsat SBTi