After the opening two days of COP27 – which were focused on the High Level Segment (HLS) dedicated to Heads of State and Government – today, November 9, was the first day of the ‘main COP’ with the opening of negotiations on official texts and agreements. Reports are that the opening phases of the talks are positive. Appropriately, given tensions earlier this week over financing for loss and damage, today was billed as Finance Day.
Highlights from COP 27: Financing Takes Center Stage
Yesterday, November 8th, was the second day of the ‘High Level Segment for Heads of State and Government’ with a focus on their speeches and declarations. The real business of COP will begin in earnest today when most of the senior politicians have departed.
Financing for Climate Loss and Damage in Vulnerable Countries
Climate loss and damage is quickly emerging as the key point of contention at this COP and foreshadows a more tense meeting than last year’s in Glasgow. This issue has been moving up the agenda and recent extreme climate events have increased the perceived urgency around this topic, particularly for vulnerable countries.
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What to Expect from COP 27
COP 27 began in Sharm el Sheikh, Egypt, yesterday. It begins inauspiciously, set against the global impacts of Russia’s invasion of Ukraine and the resulting food and energy insecurity and dramatic price rises which have pushed climate change down domestic political agendas across the world and increased demand for new sources of fossil fuel to reduce reliance on Russian gas. By the same token, the Russian aggression creates a lever that presents COP 27 with a rare, perhaps unique, opportunity to accelerate the energy transition.
Furthermore, since the effects of climate change are non-discriminatory, the need to tackle it is a genuine global need: a visionary take on COP 27 is that it could offer a ‘safe haven’ for international dialogue and collaboration where world leaders can find effective pathways forward on food, energy, nature and security. However, the augurs are not positive . . .
Billed as the ‘Implementation COP’ it was designed to require countries to improve their Nationally Determined Contributions (NDC) to reducing climate-change inducing emissions. However, the tussle over the agenda, which began at 1300 on Saturday and did not conclude until midday on Sunday, suggests that the alternative name for this COP – The African COP – is more appropriate and that the focus and key to its success lies elsewhere.…
International Sustainability Standards Board Updates: Progress Towards A Global Baseline
In October 2022, the International Sustainability Standards Board (“ISSB”) met to discuss comments received and future work pertaining to the ISSB’s proposed disclosure standards for Disclosure of Sustainability-related Financial Information (“Draft S1”) and Climate-related Disclosures (“Draft S2”).
The ISSB’s reconsideration of topics addressed in its proposed disclosure standards provides insight into the progress the ISSB is making towards the development of a global baseline of sustainability-related standards. Additionally, the ISSB’s clarification of certain proposed disclosure standards might also inform the key debates that jurisdictions worldwide are deliberating as they consider and finalize their mandatory climate-related disclosure requirements. Below we summarize the ISSB’s background; key topics discussed during the October meetings; and the ISSB’s “next steps” with respect to the finalization of the Drafts.…
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European Reporting Standards for the “S” in ESG: EFRAG’s New CSRD Disclosure Requirements for Workers and Human Rights Take Shape
On March 3 and 14, 2022, the European Financial Reporting Advisory Group (“EFRAG”) published its most recent set of Working Papers on the future of the EU’s European Sustainability Reporting Standards (“ESRS”). The ESRS will establish dozens of sustainability-related disclosure requirements that will be mandatory for thousands of EU companies under the Corporate Sustainability Reporting Directive (“CSRD”) (see our blog on the CSRD as background). Companies subject to the CSRD will be required to include these disclosures in their annual reports, and these disclosures will need to be audited. Importantly, this is the first time EFRAG has provided significant detail regarding reporting standards for topics that fall under the “S” pillar of the ESG (environmental, social, and governance) framework. The European Commission is currently aiming to have the CSRD and ESRS apply from January 2023, with initial reports due in 2024, and EFRAG will hold public consultations on its draft reporting standards in the coming months.
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Contractors Have an Opportunity to Help Shape ESG Requirements
Addressing climate change has been a priority for President Biden since his first day in office. On December 8, 2021, President Biden continued that focus by issuing Executive Order (EO) 14057, Catalyzing Clean Energy Industries and Jobs Through Federal Sustainability, which includes a number of requirements directed at introducing sustainability to federal acquisitions.
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ESG & Sustainability Reporting Developments: Climate Disclosure Prototypes
ESG and sustainability disclosure and reporting requirements for listed and non-listed companies are rapidly taking shape. As announced at COP26, there is now an International Sustainability Standards Board (“ISSB”) tasked with encouraging global uptake of ESG reporting standards. In the EU, the European Financial Reporting Advisory Group (“EFRAG”) is the body tasked with developing mandatory sustainability and ESG reporting standards under the EU’s Corporate Sustainability Reporting Directive (“CSRD”). Both the ISSB and EFRAG have each recently published ESG and sustainability disclosure and reporting “prototypes”. These prototypes are important pieces to an emergent reporting regime that is very likely to become critical commercially—if not mandatory—for many companies. There are also encouraging signs that what has until recently been a relatively disjointed set of standards, is beginning to come together under a more harmonized agenda and institutions.
This blog presents an overview of some of the detailed climate-related disclosure and reporting metrics covered by the ISSB and EFRAG climate prototypes, and highlights critical considerations for companies as more detailed and mandatory ESG and sustainability reporting frameworks begin to take shape.…
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Vying for America’s Future through Electric Vehicles
This is the twenty-second in our series on “the ABCs of the AJP”
The single largest expenditure in President Biden’s original proposal for his American Jobs Plan is a $174 billion investment to promote electric vehicles (EVs). This considerable sum reflects the fact that increasing the number of EVs on the road in the United States would advance a number of key administration priorities, as described below.
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Using Carrots and Sticks to Unleash the Potential for Clean Utilities
This is the twenty-first in our series, “The ABCs of the AJP.”
President Biden’s American Jobs Plan (AJP) sets an ambitious goal of “achieving 100 percent carbon-free electricity by 2035.” To accomplish this, the AJP proposes significant investments in grid modernization, transmission infrastructure, offshore wind, and energy storage, as detailed by our prior posts. Whether these investments – carrots, if you will – will be sufficient to drive down emissions in all states and achieve the 2035 target, in the absence of an enforceable clean electricity standard (CES), remains uncertain. Equally uncertain is the pathway for Congress to enact a CES.
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Tackling Transportation, Traffic, and Transit Troubles
This is the twentieth in our series, “The ABCs of the AJP.”
As discussed in an earlier post, the American Jobs Plan adopts an expansive definition of “infrastructure” to address systemic inequities and benefit society as a whole. However, the AJP also addresses what is typically called “core infrastructure” by proposing substantial investments to repair and modernize our nation’s roads, highways, bridges, airports, ports, and railways. As with other aspects of the AJP, the President’s investments seek to address climate and sustainability concerns and the creation of American jobs by, among other things, using sustainable and innovative building materials that are made in America.
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