Welcome Remarks delivered by UNDP Philippines Resident Representative Titon Mitra at the 2nd Annual National Business Climate Action Summit on 21 November 2019
Secretary Manuel de Guzman, Central Bank Governor Dr. Benjamin Diokno, Commissioner Rachel Herrera, distinguished representatives from government, private sector, ladies and gentlemen, good morning. Welcome to the Second Annual National Business Climate Action Summit.
It is a privilege and pleasure to have worked with the Philippines government and specifically the Climate Change Commission (CCC), to enhance private sector collaboration on climate action. We in UNDP have a long and productive history of working with the CCC in this regard. We supported the processes leading to the Manila Declaration five years ago, involving the commitment of the 7 major conglomerates to Climate Action. UNDP provided technical assistance leading to and during the negotiations on CoP 21, now known as the Paris Agreement. We have since then worked with the CCC on numerous policy papers on climate action. We helped develop indicators, measures and a data base to capture government and private sector climate action efforts. We also helped to build national capacity to access climate finance. On that note, let me congratulate the CCC for securing its very first Green Climate Fund project, approved only last week.
I also want to welcome delegates from Bhutan who are participating in this Forum and are in the Philippines to learn about effective approaches to Climate action collaboration.
I was reflecting on the idea that perhaps 2019 marks a major turning point in the narrative on global warming. For almost two decades we have been talking about climate change and the words imply to some extent an incremental process or a trend in the making. But I do think this year, the narrative has fundamentally shifted to a recognition that we are now facing a climate emergency – take the Extinction Rebellion, student climate strikes and the Sunrise Movement and their power to mobilize millions across the globe as an example.
The notion of climate emergency really hit home to me in a very personal way last week. In Australia, temperatures edged close to 400 C in spring!! Metropolitan Sydney for the first time in its two hundred year plus history, declared a “catastrophic risk of fire”. The suburb I live in metropolitan Sydney was aerially bombed with fire retardants to stem fires that were burning out of control. Millions of hectares, of productive land, livestock and wildlife were destroyed. Smoke caused air pollution levels to soar such that they were on par with New Delhi in the worst of winter. That scene has also played out this year in the US, in South America, and Europe – including Siberia!! Polar ice caps are melting before our eyes. Hurricanes and typhoons lash shores across the globe. This now appears to be the new normal.
My reflections are not entirely anecdotal. Over 11,000 scientists – not just climate scientists but from a range of disciplines and from 153 countries recently said clearly and unequivocally that the world faces a climate emergency. Their observations are radical in nature. They do not shy away from calling out population, income growth, and the consequent production and consumption patterns – as the key drivers of today’s climate emergency. They call for fossil fuels – coal and oil – to remain in the ground – NEVER to be burned to generate energy. They want a major shift in what we consume asking for a move from the heavy foot print of meat production to mostly plant-based food, along with the adoption of agricultural practices that increases the amount of carbon the soil absorbs. Perhaps most radically they ask that we no longer measure national wealth and growth in terms of production alone, but also factor in measures for sustainability and inequality.
Their headline is simple: The climate crisis has arrived and is accelerating faster than most scientists expected.
And from the perspective of the private sector, these observations should be a cause for concern. Our natural resources are under unprecedented pressure as a billion people enter the global middle class demanding more of everything. This admittedly creates a bigger consumer base but at the same time will rapidly diminish or add cost to your raw material and energy base – not all of which you can pass on to your customers. Radical transparency is opening up operations and supply chains to public scrutiny. You will be increasingly judged on how and what you produce. Extreme weather is breaking records all over the planet – affecting millions of people and costing you, the private sector dearly.
The scope of the global risk is mind boggling. Nearly one third of the world’s economic output comes from countries facing ‘high’ to ‘extreme’ risks from the impacts of climate change – this of course includes the Philippines. This translates into USD 44 trillion of the global economy at risk by 2025.
So, against this backdrop, it is very timely and opportune to revisit the Manila Declaration, which was the private sector commitment – your commitment – to invest in technologies, operations and processes that will contribute to effective climate action.
Over the last five years since signing the declaration, we have come some way. We have seen an increase in the voluntary adoption of sustainability reports by the major conglomerates. The SEC now formally requires sustainability reporting for publicly listed companies. The BSP has launched green banking initiatives. Local banks have issued green bonds and developed green financing frameworks. UNDP is supporting the CCC to establish the Climate Investment Network that will track green investments and match green capital to bankable projects. Some conglomerates have taken the decision to invest only in renewables. Two successive reports by UNDP and PBE called ‘Transformational Business” show increasing investments in the SDGs, many of which are directly related to climate action. In the first report in 2017, 75 companies reported 139 initiatives worth PHP 41 billion. In our 2019 report (yet to be finalized), 160 companies reported 399 initiatives worth PHP 232 billion. These are entirely voluntary reports and therefore are unlikely to capture the full breadth of effort to date.
There is now an incredible opportunity to manage risk, do good and do well. Richard Bronson said, “tackling climate change is one of the greatest wealth generating opportunities of our generation.” Those of you who are the first movers in terms of innovation and new business models stand to make a lot of money.
Recently, UNDP completed a study calculating the economic prize in the SDGs looking at 4 “hot spots” all relevant to climate action: smart cities; food and agriculture; sustainable energy; and circular economy. In those 4 areas, there is an estimated $82 billion in economic opportunity and 4.4 million jobs by 2030.
And there is more good news. Global climate finance is looking for bankable projects in these areas. The International Development Finance Club will mobilize $1 trillion in clean energy funding by 2025. The European Investment Bank will unlock a similar amount - $1.1 trillion – in climate action investment. 130 banks representing 1/3 of the global banking system will align their investments with the Paris Agreement. A group of the world’s largest asset owners responsible for directing over $2 trillion in capital recently committed to move to carbon-neutral investment portfolios by 2050. Conversely, the European Investment Bank just this week declared that it will no longer finance investments in fossil fuels from 2021.
If you agree with me that we are facing a climate emergency and we can do good and do well in response, then what up until now we call green business or sustainability efforts, can no longer be a side department or niche business – we need this to be core business.
Ladies and gentlemen, we need to do much more and with more urgency.
Perhaps it’s time to revisit the Manila Declaration to make more specific commitments. Of course, we need Government to send very clear market signals. A big step in that direction would be the finalization of the National Determined Contributions that will be the specific and detailed statement of intent on mitigation and adaptation. That would certainly allow companies to set quantifiable goals linked to those commitments.
It really is time now for radical collaboration and innovation building on the impressive steps you have already taken.
Thank you. [E]