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Leaders in the Middle East need a climate reality check. Here’s what they expect at COP27

Discussions around climate are heating up. Here’s how the region’s organizations aim to achieve net-zero targets in the coming years enabling a transition to a non-oil dependent economy.

Leaders in the Middle East need a climate reality check. Here’s what they expect at COP27
[Source photo: Anvita Gupta/Fast Company Middle East]

Climate chaos – the term used by the UN Secretary-General in the October briefing to raise a clarion call for the dire environmental conditions facing the earth – will be addressed at the climate change conference COP27 in Egypt. As things stand,  no country is spared by the impact of climate change: a third of Pakistan was flooded, Europe recorded its hottest summer in 500 years, the Philippines is in a vulnerable spot, and frequent hurricanes are the most costly weather disasters for the US.

COP27, taking place from November 6 to 18, will address the “loss and damage”, which refers to the larger theme of climate justice, given that some countries have recorded profits by burning fossil fuels at the cost of others. The Secretary-General had reaffirmed that “loss and damage” would be the focal point of discussions.

While many countries in the MENA region are way above ideal carbon offsets, several enterprises have made ambitious environmental promises to accelerate net-zero targets. In many ways, COP27 will present an opportunity to pick up the reins from COP26, where the most ambitious international agreement – the Glasgow Climate Pact – was signed. 

The ensuing deliberations in Sharm el-Sheikh will impact not just our immediate tomorrow but the future of humanity. We asked a few leaders who will attend COP27 about their aims and goals from COP27. 

“Sustainability will be a player in the Middle East’s GDP over the next two years because the state of the green economy and its growth trajectory is about saving the planet in an accelerated way. Growing the GDP is great but growing the green GDP (GrDP) is even better. You see, the Dubai Stock Exchange and the Saudi Stock Exchange have ESG rating systems, and companies entering the green space receive a lot more funding, which are great signs of the road ahead,” says Dina Storey, Partner, Strategy& Middle East.

BETTER LATE THAN NEVER 

Despite the critics calling any debate about green energy an attempt at greenwashing,  major announcements have branched out of the region so heavily dependent on oil. Leaders are tackling climate change by enabling a relook at the economic and energy mix. For a water-scarce region with abundant energy from fossil fuels, the challenge of scaling up clean energy development while reducing fossil emissions to meet growing energy demands will dominate the debates at COP27.  

“The time to act is now, but progress is hindered by a lack of expertise or not knowing where to start. Their challenge is to make ESG a true business driver while delivering ROI. Ultimately, we want to help turn sustainability ambition into action. At COP27, organizational leaders must recognize sustainability as a core element of their business strategy, while identifying the right advisory partners who support them through an ESG strategy that spans operations and culture,” said Saad Toma, GM, IBM Middle East & Africa.

Despite the push for sustainability, fossil-fuel dependent industries are under mounting pressure due to the mandatory ESG policies, which have risen in prominence for investors and become industry standards.

“We see businesses experiencing mounting pressure across their stakeholders to be transparent and accountable for reporting on their progress against environmental commitments. This includes their ESG disclosures and climate-related financial risks. An important issue at COP27 is how organizations can best establish an ESG data foundation to operationalize sustainability goals and increase transparency. Data-driven intelligence is vital to reducing the cost, time, and burden of ESG reporting so that organizations can focus on delivering ESG strategic outcomes,” Toma adds. 

Mounting environmental concerns in the Middle East warming at twice the global average poses serious speedbumps to sustainable development in the region and signals the urgency for a green energy pivot. 

“With the MENA region hosting the next two climate change summits, we see an opportunity to increase support for regenerative agriculture, which can address adaptation and mitigation, leading to the improvement of livelihoods and a more resilient food supply. This is a key focus area for PepsiCo,”  says Eugene Willemsen, CEO, PepsiCo, Africa, Middle East, South Asia. 

Additionally, as the case for green transition becomes stronger, Willemsen adds, “There is an urgent need to prioritize the energy crisis by unlocking Purchase Power Agreements (PPAs) and forging collaborations for increased investments in green innovation. We are also looking at creating a more thriving ecosystem for regional startups and entrepreneurs focused on sustainability through dedicated initiatives.” 

Creating a sustainable ecosystem is not ambitious, it’s the way forward to fool-proof the system. The eventual implementation of the GrDP for policy and business would ensure all stakeholders understand the major pollutants when creating policies while analyzing the true cost of their operations. 

“We would like this year’s COP to address solutions for building a workable and resilient model for the energy transition. It is important to build a model that can absorb external shocks and is agile in the face of uncertainties. It must be pragmatic and solid enough to reduce carbon emissions and make a real impact across the energy landscape in the region,” said Walid Sheta, President, Middle East and Africa at Schneider Electric.

“We’d also like to see a strengthened focus on ‘industrial sustainability’ in the manufacturing sector and a renewed focus on the circular economy,” Sheta adds.

To achieve a sustainable and progressive downstream industry, he suggests a few targets for manufacturers – implement core production reconfigurations to improve product design, minimize waste, reduce resource consumption and expand supply security – to mitigate the high costs and labor-intensive requirements of integrating these new capabilities.

Meanwhile, green and smart mobility provider Alstom, which recently set up its headquarters in Saudi Arabia, sees the emissions by the transportation industry as a big opportunity for the industry to create an impact.

“With COP27’s focus on implementation, Alstom’s goal is to demonstrate that every increase in a modal share to public transport will bring better access to opportunities, reduced congestion, increased safety, and improved air quality,” said Andrew DeLeone, President, Alstom, AMECA. 

Rail is placed to be the backbone of sustainable mobility. “However, to achieve this, a modal shift is required for passengers and freight to rail, the lowest emission mass transport mode”, he adds.

According to the IEA net-zero scenario, a modal rail shift must grow by 50% by 2030 to achieve net-zero in the transport sector by 2050. “This will require a commitment by both the public and private sector to create sufficient and convenient public transport for residents coupled with the implementation of policies to incentivize the reduction of carbon emissions and congestion,” DeLeone said. “Alstom’s aim is for carbon neutrality in transport and more social equity and inclusion by increasing the availability and efficiency of public transport.”

SUSTAINABLE COMMITMENTS TO A GREEN FUTURE 

The path to net-zero emissions may seem far-fetched for big enterprises with equally hefty carbon footprints. An undisputed fact on the road ahead is that rapid action and industry-wide innovation are core to true transformation. 

“At IBM, we believe technology is a critical enabler to meet ESG targets internally and externally. IBM has a track record of setting precedents with environmental commitments for over 50 years, and we continue to lead the charge through research, advocacy, and partnerships,” said Toma.

In 2022, the enterprise unveiled IBM Impact, a new framework for the company and ESG work reflective of its aspiration to create a more sustainable, equitable, and ethical future. Through initiatives such as its net-zero GHG emissions by 2030 commitment, IBM hopes to promote environmental justice programs like the IBM Sustainability Accelerator, enabling organizations and communities to tackle environmental issues. 

Willemsen says PepsiCo is looking to engage with around 250,000 people in livelihood improvement programs across its potato agriculture supply chain in AMESA by 2030; it avoided using five billion liters of water in 2021 through expanded use of technology, like drip irrigation, and introducing recycled plastic bottles across ten AMESA countries by 2023. “We are eager to lead by example and support accelerated progress towards creating new solutions to overcome climate change,” he says. 

Another key player that agrees with Willemsen’s 360-approach to sustainability is Sheta, “We have accelerated the transformation towards becoming the most agile, innovative, planet and customer-centric supply chain. We operate over 50 zero-CO2 sites and will reach 150 in 2025 by capitalizing on solar solutions as a prime source of electricity, including the elimination of fossil-based material handling equipment.”

The road to green mobility is rife with hurdles. Yet, Alstom, DeLeone says, is focused on electrifying the Middle East’s fleet. “Alstom is the only rail player today that offers the entire scope of low emission rail technologies, including hydrogen trains, battery trains and electrification.”

In terms of immediate green plans, DeLeone says, “We will reduce the energy consumption of Alstom’s passenger transport solutions by 25% per passenger kilometer by 2025, compared to 2014. A big part of supporting our partners lies in localizing our approach, which includes tailored solutions, financing support, developing local capability, and supporting the growth of the rail ecosystem.” 

For climate change to stop, there will need to be climate action which means all stakeholders get a seat at the table. The coming days will indicate if COP27 is another far-fetched ambition or a pragmatic step for an agreement on a mechanism averting loss and damage and a viable solution to the food, water, and energy crisis which is expected to worsen over the years without any clear action on the ground. 

ABOUT THE AUTHOR

Rachel Clare McGrath Dawson is a Correspondent at Fast Company Middle East who writes on tech, design, and culture. More

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