The REP Wrap: COP29 sees deal on international carbon markets
Negotiators have finalised a deal on the development of an international carbon market today. After nearly a decade of wrangling, governments signed off on Articles 6.2 and 6.4 of the Paris Agreement at COP29, meaning there are now rules for how to coordinate global emissions trading and carbon offsetting to support countries in meeting their climate commitments. A new finance deal was also approved at the climate summit in Baku today, including an agreement to provide $300bn annually to developing nations by 2035.
Meanwhile, European Council signed-off on the creation of a regulatory framework for permanent carbon removals, carbon farming and carbon storage in products. The CRCF Regulation will be voluntary, but is intended to set a ‘gold standard’ for carbon removal and soil emission reduction activities in Europe. As part of the rules, the EU will create a public platform that registers all certified credits/assets along with their audits and compliance records.
Member States have refused European Parliament’s request to reopen negotiations on the EU Deforestation Regulation. During a Council meeting this week, they said they were only prepared to discuss the possibility of delaying the implementation of the law – something the European Commission has proposed – but not Parliament’s additional desire to reduce its scope and application. Parliament is reportedly blocking the proposed compromise.
Primark, Chanel, Decathlon and Lacoste are among a group to have created rules for climate transition plans in the fashion industry. The ACT Fashion (Luxury, Mass, Premium) methodology, coordinated by Paris Good Fashion, is based on existing guidance known as ACT, which was sponsored by the French Government. It received 180 responses during public consultation and was then road-tested by 12 companies to see if it worked in practice.
Gary Gensler has announced he will step down as the head of the US Securities and Exchange Commission on the day of Donald Trump’s January inauguration. Trump has said he will sack Gensler, under whose leadership the financial regulator has softened rules for shareholders wanting to file ESG-related resolutions, and tried to introduce climate disclosure requirements for companies.
More than a quarter of UK companies have acknowledged there is evidence of modern slavery in their operations or supply chains, according to this year’s CCLA Modern Slavery Benchmark. The initiative, backed by institutional investors, assessed 110 large British companies and concluded that 30 of them have “either found evidence of modern slavery in their supply chains, or indicators that some sort of forced labour was taking place”. It said the number was up on last year’s assessment, suggesting that companies are being more thorough in their investigations, but that they aren’t addressing the problem properly.
The OECD has published recommendations on how businesses should address the climate crisis, based on the environmental section of its existing Guidelines for Multinational Enterprises on Responsible Business Conduct. The report addresses target-setting, climate adaptation strategies and how companies can contribute to the just transition.