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Bold measures to close the climate action gap

March 4, 2024

The Alliance for CEO Climate Leaders, a CEO-led community facilitated by the World Economic Forum that is committed to accelerating the net-zero transition, released a new report calling on businesses and governments to shift from incremental to systemic actions to meet climate goals.

According to the analysis, while individual climate action has increased, collectively the sum is not sufficient to reach the level of systemic change needed. There is a 600-plus gigaton gap in national emissions reduction ambition and policy that needs to be closed to limit global warming to 1.5°C. As such, stronger government action is needed. Meanwhile, looking at CDP data for the 1,000 largest companies globally, likely well over 10% of global emissions are in the supply chains of those companies– showing the dramatic systems impact that the world’s largest companies could have.

“The first UN global stocktake and the first part of this report have highlighted a large climate action gap that we are not on track to close,” said Pim Valdre, Head of Climate Ambition Initiatives at the World Economic Forum. “We need to urgently shift into delivery mode, focusing on immediate actions with outsized impacts. Enabling these actions calls for public-private action to drive the right policies, technologies and financial solutions needed to achieve a system-wide transformation.”

Private-sector action

According to the report, companies can and should drive systemic impact beyond their internal initiatives. The paper highlights five actions with the potential for dramatic impact:

  1. Accelerate supplier decarbonization: according to CDP data, likely well over 10% of global emissions are in the supply chains of the 1,000 largest companies globally.
  2. Enable customers to make greener choices: reducing the first 50% of many products’ emissions can be achieved with an end-price impact of under 1%.
  3. Drive change with peers in their industry, especially in supply chain ‘pinch points’: 10 players or less control more than 40% of many key markets.
  4. Engage in cross-industry partnerships, especially large-scale buying groups: mobilizing less than 10% of the 1,000 largest companies’ Capex and purchases could close the climate funding gap.
  5. Advocate and support bolder policies: according to InfluenceMap, the advocacy of 95% of global companies is today either misaligned with the Paris goals or sending mixed signals.

Government action

Governments have a large responsibility to deploy mitigation solutions in a just and socially acceptable way. The report highlights other five priorities to help close the 600-plus gigaton emissions gap:

  1. Move up net-zero targets to 2050 or earlier, increase near-term targets, and raise financial and technical support from higher-income to lower-income nations.
  2. Recognize and put a material price on carbon.
  3. Double financing and incentives and make public procurement green.
  4. Remove obstacles such as permitting lead times, supply chain bottlenecks, skill gaps and social distrust.
  5. If progress remains too slow, consider more drastic measures, such as hard technology bans, or massive adaptation and removal investments.

Source: World Economic Forum