What to Expect from COP29

As we look toward COP29, happening from November 11-22, 2024 in Baku, Azerbaijan, the stakes are higher than last year’s COP28. This year nations and businesses worldwide will come together under the theme Enhancing Ambition and Enabling Action. COP29 will challenge both governments and the private sector to accelerate progress and meet global climate commitments.

Nigar Arpadarai, UN Climate Change High-Level Champion for COP29, has emphasized the essential role of the private sector in climate action alongside government initiatives. As the private sector becomes more involved in delivering large-scale climate solutions, here are the key themes expected to dominate the agenda at COP29 and their implications for businesses.

1. Climate Finance and the New Collective Quantified Goal (NCQG)

COP29 is being called the “Finance COP” as negotiations for a new climate finance goal will dominate the agenda. The New Collective Quantified Goal will build on the outcomes of the Global Stocktake agreed at COP28. The top priority is to agree on a fair and ambitious NCQG, replacing the previous $100 billion per year commitment from 2009 that was only recently met.

Key Points:

• The negotiations are expected to address both the quantity and quality of financial support needed.
• The European Union, currently the largest contributor, seeks to expand the contributor base by involving recently wealthier countries.
• The NCQG aims to enhance funding accessibility for developing nations and align contributions with their urgent needs.

What It Means for Businesses:

• Companies should prepare to adjust their strategies to capitalize on opportunities in climate finance and clean energy investments.
• The operationalization of the Loss and Damage Fund may also be part of NCQG discussions, increasing the importance of private sector involvement in funding climate resilience.

2. Investing in New Technologies and Clean Energy Connectivity

Accelerating the transition to renewable energy sources is crucial for achieving net-zero emissions by 2050. COP29 will focus on eliminating fossil fuel subsidies, redirecting investments toward clean energy, and advancing zero-emission technologies such as clean hydrogen.

Key Points:

• Zero-emission technologies like clean hydrogen will play a significant role.
• Cross-country green infrastructure development will be explored to promote resilient sustainable energy systems.

What It Means for Businesses:

• Early investors in green energy initiatives will gain a competitive advantage in securing funding and capturing market share.
• COP29 offers a platform for energy producers and investors to collaborate across sectors and geographies, creating new business models and market opportunities.

3. Mitigation

COP29 will put the spotlight on integrating non-carbon dioxide emissions into Nationally Determined Contributions (NDCs), which are due to be updated shortly after the conference. Key sectors such as agriculture, waste management and methane reduction will take center stage, as countries work to address all greenhouse gases alongside CO₂.

Key Points:

• Countries are expected to update and strengthen their NDCs to align with the 1.5ºC target.
• A Methane and Non-CO₂ Greenhouse Gases Summit, co-organized by the U.S. and China, will push nations to commit to reducing methane and other non-CO₂ emissions.

What It Means for Businesses:

• Industries like agriculture, waste management and energy will face increased scrutiny over non-CO₂ emissions.
• Companies will need to adopt innovative solutions and reporting practices to remain competitive.

4. Adaptation Strategies

As climate impacts worsen, adaptation will be a central topic at COP29. The conference will prioritize National Adaptation Plans (NAPs) and push for greater financial support to help vulnerable countries prepare for climate risks.

Key Points:

• COP29 will emphasize the need to double adaptation finance by 2025 so vulnerable countries have resources for climate resilience.
• There is increased urgency to balance funding between adaptation and mitigation.

What It Means for Businesses:

• New opportunities will emerge in sectors such as infrastructure, construction and resilience projects.

5. Nature-Based Solutions

Integrating nature into climate action will also be a key theme at COP29. Nature-based solutions (NbS) are being recognized for their ability to mitigate climate change while promoting biodiversity and enhancing resilience.

Key Points:

• Solutions include protection and restoration of ecosystems such as forests, wetlands and mangroves.
• NbS address both carbon reduction and climate resilience while safeguarding biodiversity.

What It Means for Businesses:

• Corporations that integrate NbS into sustainability plans can support climate goals and enhance environmental impact.
• Companies that adopt NbS may position themselves as leaders in corporate responsibility.

6. Focus on Small Businesses

There is a growing recognition of the role small businesses in climate action, as small businesses represent nearly 90% of all businesses globally and generate about 70% of global jobs.

Key Points:

• COP29 will include initiatives to increase access to resources and tools for small enterprises to adopt sustainable practices.
• The aim is to help small businesses integrate climate resilience into business models.

What It Means for Businesses:

• Large corporations can partner with small businesses to uplift supply chain sustainability.
• Supporting small business climate efforts enhances supply chain robustness and reputation.

Conclusion

The overall goal of COP conferences remains strengthening global cooperation to address climate change and pushing public and private sectors to increase their commitments under the Paris Agreement. At COP29 countries will be expected to show greater responsibility and accountability, with renewed focus on sector-specific strategies and inclusion of small businesses in climate action.

For the private sector engaging with these developments is crucial. Companies must demonstrate transparency in capital allocation and align investment decisions with global climate goals to thrive in a low-carbon economy.

STRIVE by STX will host an informative webinar on Wednesday, November 27 to help businesses understand COP29 outcomes and their corporate implications. If you cannot attend we will publish a key takeaways report. Stay connected with us for insights on how COP29 will shape climate action.

Interested or have any questions?