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COP28 Insights: What Canadian Businesses Need to Know

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Introduction:

COP28 in Dubai marked a historic shift in the global climate conversation, notably addressing the role of fossil fuels in climate change for the first time. We explore the key outcomes of COP28 and their implications for Canadian businesses, with a focus on the evolving landscape of ESG reporting and climate legislation.

Key Takeaways from COP28:

Historic Acknowledgment of Fossil Fuels and Balancing Interests: COP28 explicitly addressed the need to transition away from fossil fuels for the first time, marking a significant shift in global climate policy. This development reflects a delicate balance between the ambitions of island nations that are impacted by climate change the most and the oil-producing and fossil fuel economies, with a focus on transitioning energy systems in a just and equitable manner, aiming for net zero by 2050.

Significant Climate Financing Commitments:  At COP28, a major financial pledge was made towards global climate solutions, totaling $30 billion. In addition, multilateral banks committed to adopting principles for nature-positive finance, promising to allocate $100 billion by 2027 for such initiatives. This includes approximately $2.7 billion specifically earmarked for nature-based solutions. These commitments represent a substantial increase in funding for climate action, underscoring the urgent global need for substantial financial resources to effectively combat climate change. 

Nature-Based Solutions and Biodiversity: COP28 saw a breakthrough in nature protection, with significant finance allocated towards nature-based solutions. The inclusion of oceans and blue carbon in many countries’ NDCs(National Determined Contributions) and initiatives focused on mangrove conservation underscore the importance of biodiversity in climate action.

Stalled Progress on Carbon Markets: COP28 witnessed a significant impasse regarding Article 6.4 of the Paris Agreement, a crucial element for advancing international carbon markets. This article was anticipated to establish a new mechanism for trading greenhouse gas (GHG) emission reductions between countries, under the supervision of the Conference of Parties. The failure to reach a consensus on Article 6.4 creates uncertainty that can hinder the establishment of a clear framework and incentives for countries and businesses to invest in emission reduction projects. 

Methane Emissions and Oil and Gas Decarbonization: The Oil and Gas Decarbonisation Charter (OGDC) saw fifty leading companies, including major oil and gas players, commit to net-zero operations by 2050. This voluntary commitment includes pledges to eliminate routine flaring and achieve near-zero methane emissions by the end of the decade.

Key Takeaways for Canada from COP28:

The outcomes of COP28 herald significant changes for Canadian businesses, particularly in light of Canada’s commitment to sustainable practices and climate action. Here’s what Canadian businesses can expect:

Increased Focus on Renewable Energy and Resource-Intensive Sectors: Beyond the oil and gas industry, other resource-intensive sectors like mining, forestry, and manufacturing will also feel the impact of COP28. These sectors must pivot towards more sustainable practices, exploring renewable energy sources and reducing their environmental footprint to align with the Canadian climate goals in line with Canada’s position on COP 28. 

Enhanced ESG Reporting Requirements: This global agreement will fast-track ESG disclosure requirements, making comprehensive sustainability reporting a norm for Canadian businesses. With the Canadian Sustainability Standards Board (CSSB) working closely with the ISSB, the adoption of IFRS S1 and S2 standards in Canada is expected to accelerate. The growing emphasis on ESG in the US market further underscores the need for Canadian companies to enhance their ESG reporting to meet investor expectations.

Navigating New Regulatory Landscapes: The acceptance of COP28’s outcomes will likely lead to new and accelarate current legislative changes at both federal and provincial levels in Canada. Businesses should prepare for potential regulations such as a more extensive and steeper carbon tax, covering all provinces. Staying informed and adaptable to these regulatory shifts will be crucial for maintaining compliance, protecting the bottom line, and seizing opportunities in a changing market.

Opportunities in Nature-Based Solutions: COP28’s focus on halting deforestation and promoting biodiversity presents new opportunities for sectors like agriculture and forestry. Embracing and incorporating nature-based solutions into business operations and strategy can open new revenue and financing options and access to emerging markets centered around environmental conservation and sustainability for Canadian businesses.

Expert Guidance for a Smooth Transition: As Canadian businesses navigate these changes, expert guidance becomes invaluable. YellowYellow, with its specialized ESG consulting services, is well-positioned to assist businesses in adapting to these new requirements. Our team can help you with GHG quantification, ESG reporting, and aligning your business strategy with the latest sustainability standards, ensuring you not only comply with new regulations but also thrive in a sustainable future. Book your consultation with us here: https://calendly.com/lisa-annabel

Sources :

1. Image credit: Kiara Worth | UN Climate Change, https://unfccc.int/news/cop28-agreement-signals-beginning-of-the-end-of-the-fossil-fuel-era

2. BCG, This Is What Has Been Agreed at COP28 So Far. What Happens Next? https://www.bcg.com/publications/2023/this-is-what-has-been-agreed-at-cop28-so-far  

3. COP28 key takeaways : https://www.woodmac.com/news/the-edge/cop28-key-takeaways/

4. Global Canopy insights: https://globalcanopy.org/insights/insight/for-the-first-time-halting-and-reversing-deforestation-makes-it-into-the-final-text-of-a-cop-deal/

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Jeff Garcia-Seminario

AssociateSenior Associate, Social Impact
Jeff brings global experience in leading corporate social responsibility (CSR) and community engagement projects in the extractive sector.   Jeff excels in stakeholder mapping, community engagement, and conflict resolution.   Applying his private and public sector experiences, Jeff can bridge cultural and historical divides between extractive industries and their communities.  His areas of focus include food security, sustainable procurement, and good governance. Most recently, Jeff contributed to the development of an ESG strategy for a multi-national company.  
Jeff’s native language is Spanish. He enjoys morning runs in the neighboring parks. 

Kaitlyn D'Lima

Associate

Kaitlyn D’Lima holds both a Bachelor of Business Administration and a Master of Science and Sustainability Management degree from the University of Toronto.   She is also trained in greenhouse gas (GHG) accounting.

She brings extensive experience in sustainability and business transformational projects. She is known for her ability to execute projects of any size with both urgency and accuracy.   Kaitlyn has a natural talent for improving stakeholder engagement. She’s a real trailblazer when it comes to benchmarking and research.

Kaitlyn is a runner who participates in outdoor adventure races.

Arun Balu Pazhayannur

Advisor

Arun B Pazhayannur holds a degree in mechanical engineering and is a Chartered Accountant. He also has an MBA from the Ivey Business School at the University of Western Ontario. Along with his academic achievements, he has a thorough knowledge of Environmental, Social and Governance (ESG) principles, which he incorporates into his consulting work. 

Arun is well-known for his leadership abilities as well as his strong skills in data analysis, financial modeling, and operations management. He has been recognized for his ability to identify practical solutions and deliver value to clients ranging from banks to payment companies to software providers. Arun is also a past President of Toastmasters Club. 

In his free time, Arun enjoys scuba diving.In his spare time, Arun likes to scuba dive. 

Gregory Donovan

Senior Advisor

Gregory  Donovan is a Chartered Accountant. He is a Fundamentals of Sustainable Accounting (FSA) Credential Holder.  He obtained an Honours in Business Adminstrations (HBA) from the Ivey Business School (Western University) and a Master or Laws (LLM) from the London School of Economics. Gregory is the CEO of Avondale Private Capital, a sustainable finance firm focused on energy transition finance and carbon markets.  He has presented on these topics at conferences in Canada, the US and UK.  

Greg participates in the occasional triathlon and loves to go skiing and sailing with his two young children.

Margaux Loptson

Associate & US Operations Lead

Margaux Loptson holds a Bachelor of Arts (Psychology) and a Bachelor of Arts (Criminology) from Pennsylvania State University. In addition, she holds several research certifications, including Ethical Conduct for Research Involving Humans. 

She has been an essential player in AI-powered teaching and learning projects as a User Experience (UX) lead.  Margaux is known for applying her design thinking, problem-solving and analytical skills to make a positive impact. She is a native French speaker. 

Margaux is a fitness enthusiast who can be found hiking around Central Park in NYC.

Ritika Jain

Associate / Responsible Supply Chain Lead

Ritika Jain holds a Masters in Environmental Sciences, Policy and Management from Lund University (Sweden)  and a Bachelor of Technology from Indraprastha University (India). As a lifelong learner, she is pursuing a Graduate Diploma in Corporate Social Responsibility and Sustainability at the University of Toronto.

Ritika is a recycling and responsible supply chain specialist.  Through her work, she collaborates with organizations to implement circular economy focused policies to ensure compliance with regulations.  

Her proficiency in data analytics and with the Global Reporting Initiative (GRI) enable her to manage complex sustainability data. Ritika also volunteers with the UN Sustainable Development Solutions Network, engaging with youth to drive positive change.  

Ritika is a native Hindi speaker.  She is a certified hiking leader who enjoys travelling.

Jonathan Spence

Associate & Western Canada Operations Lead

Jonathan Spence holds an Honours Bachelor of Integrated Sciences (Earth and Environmental Sciences) from McMaster University and has his certification in Geographic Information Sciences from the ESRI Canada Center of Excellence at McMaster University. Jonathan worked as a research analyst in the environment and sustainability group for a TSX listed company.  

He is pursuing his Ph.D. in Earth and Atmospheric Sciences at the University of Alberta, where he is researching the development of carbon capture techniques and their applications to the mining industry.  Jonathan is focused on helping companies to minimize their carbon footprint while supporting their economic growth.   

Jonathan is an avid water polo player and coach. He plays for the local National Championship League team. 

Gurnoor Gandhi

VP Business Development & Strategic Partnerships

Gurnoor Gandhi holds an MBA from Ivey Business School (Western University) and a postgraduate diploma in Maritime Energy Management (Sweden). Gurnoor brings experience with sustainability frameworks including TCFD, GRI, and CDP and is pursuing FSA credential (SASB). 

Gurnoor has global leadership experience in the shipping industry managing assets worth millions of dollars on the high seas and has led diverse teams worked in Monaco, Singapore, and India. Most recently, he led organizational development and client partnerships at CARD, a non-profit focused on rural development and renewable energy.

Gurnoor brings a blend of technical and leadership skills. He applied his knowledge of greenhouse gas accounting and carbon capture to support clients with niche energy transition projects. He is known for putting his problem-solving, stakeholder management, and project management skills to work to help firms expedite their ESG Journey. 

Gurnoor is a certified BMW adventure motorcyclist who finds off-road rides rejuvenating for body and spirit.  He enjoys hiking with his family.

Lisa-Annabel Ellis

Founder & CEO

Lisa Annabel Ellis holds an Honours Bachelor of Science (Environmental Science) from the University of Toronto and an MBA from the Ivey Business School (Western University). She is a certified Project Manager Professional (PMP) with a Six Sigma Green Belt. Lisa is a Fundamentals of Sustainable Accounting (FSA) Level II Candidate. Applying her deep expertise in business and operational strategies, she has led award-winning transformational initiatives.

Drawing on her well-rounded science and finance expertise, she launched YellowYellow to help clients advance their sustainability practices. As an advocate of transparency and good governance, she partners with clients to understand their risks and opportunities to generate superior long-term value. Stakeholders across the value chain recognize the impact of this effort. She has been called upon to be a keynote speaker and lecturer.

Lisa is an advanced scuba diver who enjoys most water-related sports.