COP29 and making your organisation green without going into the red
In November, nearly 200 world leaders and 30,000 delegates came together at the ‘finance COP’ in Baku, Azerbaijan.
The outcomes of COP29 highlight the challenges ahead and the opportunities for companies to align their strategies with a rapidly changing regulatory and economic landscape. At the heart of every sustainability transformation is a finance challenge: How do you turn your organisation green without going into the red?
A new era of collaboration
Sustainability and finance teams don’t often work together, but COP29 alongside regulatory shifts such as the EU Sustainable Finance Framework, made up of the Corporate Sustainability Reporting Directive (CSRD), the Sustainable Finance Disclosure (SFDR) and the EU Taxonomy have pushed them to do so.
For many businesses, this marks the first time these teams will cooperate to align financial and non-financial reporting. For finance teams, this means delving into the details of sustainability initiatives and understanding how these efforts can drive overall business success.
By joining forces, sustainability and finance teams can streamline data collection, improve transparency, and create a resilient business. The benefits extend to annual reports, which can now present a cohesive narrative of financial performance and sustainability achievements.
The carbon market
In recent years, the carbon credit market has faced intense scrutiny, with questions about its legitimacy and scandals undermining confidence in its effectiveness.1 After nearly a decade of efforts, COP29 has fully operationalised Article 6 of the Paris Agreement, making country-to-country trading and a carbon crediting mechanism functional. These new rules establish clear frameworks for countries to generate, trade, and register carbon credits, enhancing collaboration and driving climate action.
This marks a significant step forward, offering businesses new opportunities to meet emissions targets by supporting renewable energy projects, forest protection, and other decarbonisation initiatives in developing countries. Companies can also integrate carbon markets into their broader sustainability strategies, which will help them comply with regulations and gain a competitive advantage in the low-carbon economy.
1. https://www.theguardian.com/environment/2024/nov/24/cop29s-new-carbon-market-rules-offer-hope-after-scandal-and-deadlock
The return on investment of sustainability
Sustainability teams have often been viewed as cost centres, but this perception is changing. COP29 has reinforced the business case for sustainability, highlighting the return on investment of green initiatives. From improved energy efficiency to enhanced brand reputation, sustainability efforts are driving measurable benefits that contribute directly to the bottom line.
Businesses are beginning to recognise that sustainability is not just about meeting emissions targets but also about building climate resilience and demonstrating to stakeholders that the company has the foresight and adaptability to thrive in a rapidly changing world.
This shift is critical for businesses aiming to attract investors, with BlackRock prioritising ‘transition investing which aims to invest more in businesses’ that can demonstrate their role in creating a low-carbon future.2
2. https://www.blackrock.com/corporate/sustainability/low-carbon-transition
Navigating the transition
The discussions at COP29 underscored that the climate transition is about more than just cutting emissions—it’s about building trust, ensuring accountability, and unlocking opportunities to create a thriving future for both people and the planet. Frameworks such as the CSRD and the EU Taxonomy are potent tools for driving transformative financial changes within businesses. By integrating financial and sustainability reporting, companies can develop cohesive strategies to address climate risks and seize opportunities, positioning themselves at the forefront of this critical transition.
At Gather, we specialise in helping companies navigate this transition. Whether you’re seasoned in sustainability reporting or just starting, our expertise in CSRD implementation and double materiality will help you stay ahead.
Get in touch:
To learn more about how we can support your journey, reach out to Katy Fuller, Senior Sustainability Consultant, at katy@gather.london