As we stand on the brink of COP28 (November 30 to December 12, 2023), Everest Group’s technology service provider clients and industry leaders are poised to play a pivotal role in advancing the goals set forth by the Paris Agreement. In this blog, we bring you insights from Everest Group’s sustainability analysts on their hopes and expectations for this crucial global event.
As the world anticipates COP28, Everest Group’s insights shed light on the evolving sustainability landscape. Nothing could underpin the importance more than the fact that the first Global Stocktake (GST) of the implementation of the Paris Agreement will conclude at COP28, the mid-point in the implementation of the 2030 Agenda for Sustainable Development and its SDGs, including Goal 13 (climate action). We will explore key expectations that underscore the crucial role of technology service providers in meeting the objectives of the Paris Agreement, which we hope will be central in the COP28 deliberations.
As a reminder, there was a broad global consensus that COP28 will focus on four significant paradigm shifts:
- Fast-tracking the energy transition and slashing emissions before 2030
- Transforming climate finance, by delivering on old promises and setting the framework for a new deal on finance
- Putting nature, people, lives, and livelihoods at the heart of climate action
- Mobilizing for the most inclusive COP ever
With this context, we look forward to progress on five key topics:
- Digital transformation for sustainability:
The role of digital transformation in achieving sustainability goals is critical. Our research highlights the transformative power of technology in reducing carbon footprints, enhancing energy efficiency, and driving sustainable practices across sectors as diverse as oil & gas, banking & finance, and manufacturing.
This US$50 billion+ market also has a profound impact on sustainability beyond operational efficiency. In the realm of supply chain management, advanced technologies such as blockchain enable transparent and traceable sourcing, ensuring ethical practices and minimizing environmental impact. The integration of smart grids and renewable energy solutions empowers organizations to embrace cleaner, more sustainable energy sources. Additionally, data-driven insights derived from advanced analytics not only optimize resource allocation but also inform strategic decision-making for long-term sustainability. As businesses navigate a rapidly changing landscape, the fusion of digital innovation and sustainability becomes an integral strategy for fostering resilience and creating a paradigm where economic growth and environmental stewardship coalesce for a more sustainable future.
While optimization-driven engagements have continued to be the major theme, with almost one-third of the deals signed in 2023 (YTD), decarbonization and ESG data monitoring and reporting have also gained a lot of traction for the buyer side.
- Emerging technologies and climate action:
The intersection of emerging technologies and climate action is paramount. Insights emphasize the potential of artificial intelligence (AI), blockchain, and other cutting-edge technologies in creating innovative solutions for climate change mitigation. These technologies facilitate real-time monitoring, enabling swift responses to environmental shifts. AI-driven predictive models enhance climate resilience, while blockchain ensures transparent carbon trading.
Generative AI has been the talk of the town lately, and providers have not shied away from experimenting with gen AI use cases in sustainability either. The most common use cases are around rapid design, prototyping, and automation and streamlining of manual processes. There is immense potential in these emerging use cases to transform the way we look at sustainability engagements.
- Resilient and sustainable business models:
Integrating sustainability into business models must be the way of the future. Our research emphasizes the need for resilient and sustainable business models that align with environmental objectives, paving the way for discussions on these models at COP28.
Sustainability-driven innovation in product development helps enterprises increase market responsiveness and differentiated brand value. Products marketed as sustainable now hold a 17.0% market share, with significant growth during the pandemic, as per the NYU Stern Sustainable Market Index.
- Collaboration and ecosystem partnerships:
Collaboration is fundamental in scaling up sustainable initiatives. We have seen the importance of ecosystem partnerships, bringing together governments, businesses, and technology service providers to drive collective action.
This is a theme prominent not just at an enterprise level, but also at an international level. For example, the EU pledged €12 million in grants to support Kenya’s green hydrogen industry.
- Regulatory framework convergence:
We anticipate significant implications for the evolving regulatory frameworks surrounding sustainability.
Standardizing environmental guidelines aids businesses in navigating complex landscapes and investors in making decisions based on transparent and comparable disclosures. Industry associations like the International Council on Mining and Metals, the World Gold Council, the Copper Mark, and the Mining Association of Canada are moving to develop a responsible mining code to define one minimum global standard for the industry’s environmental impact, human rights, and due diligence.
The discussions at COP28 are expected to influence how governments, industry consortia, and businesses approach environmental goals, potentially shaping more streamlined regulations and standards.
Everest Group is cautiously optimistic
The negotiations will likely provide a platform for technology service providers to contribute their expertise in navigating the complex interplay between sustainability and technology. As Everest Group’s areas of research align with the ongoing discussions, we anticipate a nuanced understanding of how regulatory changes may impact the adoption of digital solutions, emerging technologies, and sustainable business practices.
COP28 represents a crucial juncture in the global pursuit for sustainability, and Everest Group’s research positions technology service providers at the forefront of this transformative journey. As the negotiations unfold, the impact on regulatory frameworks and the collaborative efforts of governments, businesses, and technology providers will shape the trajectory towards achieving the goals set by the Paris Agreement. Everest Group remains committed to providing insights that navigate the evolving landscape of sustainability, guiding organizations toward a more resilient and environmentally conscious future. To discuss further reach out to Rita Soni, Principal Analyst, Sustainability Research and Impact Sourcing, [email protected], Arpita Dwivedi, Practice Director, Sustainability and Talent, [email protected], Ambika Kini, Senior Analyst, Sustainability Technology and Services, [email protected], or Meenakshi Narayanan, Senior Analyst, Sustainability Technology and Services, [email protected].
Don’t miss our LinkedIn Live session, Building a Sustainable Future: Reflections on COP28 and Insights for 2024.