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The Road from Glasgow

Blog by Jessica Fries, Executive Chairman, A4S


COP26 has not solved the climate crisis, but significant steps have been taken in the right direction. We now need to look at how we can turn ambitions into actions, and actions into progress towards 1.5°C. As David Blood, Founding Partner of Generation Investment Management, said in one of our A4S@COP broadcasts, “what ultimately matters is not the road to Glasgow, but the road from Glasgow.” It is clear that finance is going to play a significant role in choosing the right path.

Firstly, we need to be honest about the gap that remains. According to Climate Action Tracker, “with all target pledges, including those made in Glasgow, global greenhouse gas emissions in 2030 will still be around twice as high as necessary for the 1.5°C limit”.[1] This means we are not on course to avoid catastrophic climate change[2], which scientific consensus has underlined means limiting the increase in global average temperatures to 1.5°C above preindustrial levels.[3] Every fraction of a degree above this level increases the risks and the negative impacts faced. Additionally, many of the commitments are focused on 2050. Setting out interim milestones for 2025 and 2030 is critical. The agreement from COP26 is to come back next year to revisit and strengthen 2030 climate plans to align them better with the 1.5°C ambitions.

IT’S ALL ABOUT the plumbing

Although we need to continue to raise ambition and deliver on the commitments already made, COP26 also achieved real progress in terms of the underlying systems that will be key to limiting global heating. Over US$130 trillion of private capital is now aligned to net zero emissions by 2050 as part of the Glasgow Financial Alliance for Net Zero (GFANZ), a consortium of more than 450 banks, asset managers and insurers. Speaking at the announcement Mark Carney said, "We now have the essential plumbing in place to move climate change from the fringes to the forefront of finance so that every financial decision takes climate change into account."[4] Alongside this news, the UK has announced that it will make the publication of transition plans mandatory for all asset managers, regulated asset owners and listed companies. These plans will be key to assess whether net zero commitments are backed up by action.

Another essential piece of plumbing has been the establishment of the IFRS Foundation’s International Sustainability Standards Board (ISSB). For A4S, and many in our network, this is something we have been working towards for a long time. It is a significant milestone towards an accounting and financial system that can provide the foundation for a resilient and sustainable economy. For the ISSB to be a success, A4S has set out five key things it must achieve.

Other notable news has included pledges on methane[5], deforestation[6] and the first ever mention of coal in a COP agreement. Recognizing the challenges to reaching consensus among all countries involved in the official UN process, many of the key announcements have been formed out of ‘high ambition’ coalitions, frequently bringing together public and private sectors alongside NGOs, civil society and others to achieve progress. This multistakeholder collaboration will be key to rapidly scaling up ambition, innovation and action over the coming years.

What’s next

The final deal at Glasgow requested countries to “revisit and strengthen” 2030 targets by the end of 2022. That means there will be plenty of updates to look out for, both in the private sector and on the international stage, in the run up to COP27 (to be held in Egypt next November).

Over the next year we also expect further mandatory financial disclosures, such as the UK’s Sustainability Disclosure Requirements which were announced ahead of COP, and the EU’s Corporate Sustainability Reporting Directive. In the US, Securities and Exchange Commission (SEC) Chair Gary Gensler has “asked SEC staff to develop a mandatory climate risk disclosure rule proposal for the Commission’s consideration”.[7] The SEC staff have been asked to consider a variety of qualitative and quantitative information about climate that would help investors make decisions.[8] The proposed disclosure rule is expected to be released in early 2022.[9]

For each of us, we can look at our own role and ask what more we can do to go from commitment to action – in our own organizations and by influencing others around us.  What are you going to do now and through the business cycle to take action? How can you integrate and improve your carbon budgeting within your financial budgeting? How can you complete the scenario analysis required to report on your climate related financial disclosures? How will you account for financed emissions, and align investment strategies with a 1.5°C pathway? How do you support action which will enable a just transition? And how can you increase resilience in the face of the climate shocks which will continue to grow even if rapid action is taken?

As HRH The Prince of Wales said during COP26, in his video message to the Finance for the Future Awards, “Unless we can unlock private sector resource, innovation and finance, with the public sector setting a framework of incentives and regulation, we simply do not stand a chance of solving the existential crises we have engineered for ourselves over the years.”

We’ll be talking about all of this and more at the A4S Summit on the 29th November. Join us, free and online, to see how finance can take the right road from Glasgow.


[1] https://climateactiontracker.org/press/Glasgows-one-degree-2030-credibility-gap-net-zeros-lip-service-to-climate-action/

[2] https://climate.nasa.gov/news/2865/a-degree-of-concern-why-global-temperatures-matter/

[3] https://www.ipcc.ch/sr15/

[4] https://www.investmentweek.co.uk/news/4039644/cop26-finance-sector-report-essential-plumbing-tackle-climate-change

[5] https://www.bbc.co.uk/news/world-59137828

[6] https://www.bbc.co.uk/news/science-environment-59088498

[7] https://www.sec.gov/news/speech/gensler-pri-2021-07-28

[8] https://www.sec.gov/news/speech/gensler-pri-2021-07-28

[9] https://www.cfodive.com/news/sec-asks-companies-details-impact-climate-change/607096/

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The A4S Summit 2021

Following the UN Climate Conference (COP26), the A4S Summit 2021, now in its 15th year, will act as a springboard for action for the finance community. The event will cover practical actions that the finance community is taking, as well as focus on the remaining challenges in addressing environmental and social risks and opportunities.


Our aim in glasgow was to bring finance to COP26, and COP26 to the finance community. Watch our broadcasts, read our blogs and download our guidance.


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