2021 could be considered the year when climate and sustainability entered the mainstream. Extreme weather disrupted millions of lives: from snowstorms in Spain and sandstorms in China to floods in Germany and wildfires in southern Europe, the past year provided further evidence of the intensifying effects of climate change. The latest report by the Intergovernmental Panel on Climate Change (IPCC) signalled a “code red” for humanity, according to UN secretary-general António Guterres.
High-level climate and biodiversity negotiations ended on a mixed note. While the importance of protecting biodiversity and investing in nature has been rising on the global agenda, the latest UN Biodiversity Conference (COP15) was postponed in 2020 because of the pandemic. The first part of a rescheduled conference took place virtually in October 2021, with the second due to be held in China in April/May 2022 as a face-to-face gathering, leaving critical action on these topics significantly delayed.
Despite frantic dealmaking and a slew of exuberant announcements, climate negotiations at COP26 didn’t culminate in a clear path towards mitigating the climate emergency. Progress on pledges in areas such as deforestation and methane reductions was tempered by a lack of advances in other critical areas, such as clear commitments to deliver the promised US$100bn per year in adaptation funding to climate-vulnerable countries, or establishing a robust loss and damage mechanism to help developing economies repair and recover from extreme weather events and vanishing coastlines.
A damning Climate Action Tracker report published during COP26 found that current national commitments could lead to global warming of 2.4°C by 2100, well above the 1.5°C target. Tough decisions have been delayed further: the final COP26 declaration urges countries to revise their emissions targets in 2022, but leaves the “how” up to them.
So what are the prospects for 2022? And in particular, where do we see critical progress emerging in the five key areas of Economist Impact’s Sustainability Project?
Net-Zero & Energy
Resilience & Adaptation
Circular Economies
Ecosystems & Resources
Social Sustainability
A year of implementation
For each of these five areas the focus will be on starting to implement the pledges and announcements made by governments and businesses at global conferences, in reports and in press releases.
On Net-Zero & Energy, 2022 will see countries stepping up their plans—so-called nationally determined contributions (NDCs)—to bring them in closer alignment with the Paris climate accord. Meanwhile companies are also under increased pressure to reach net-zero emissions by 2050. A major milestone in boosting corporate sustainability disclosure in global capital markets is the creation of the International Sustainability Standards Board (ISSB). As of January 1st, Emmanuel Faber, former CEO of Danone, will serve as ISSB chair. ISSB will develop the IFRS Sustainability Disclosure Standards as a “global baseline of disclosure requirements designed to give investors high-quality, globally comparable sustainability information”. These developments will combat corporate greenwashing and increase emphasis on sustainability reporting, leading to real-world improvements in economic, social and environmental impact.
Resilience & Adaptation will remain high on the global agenda. The latest UNEP Adaptation Gap Report found that “further ambition is needed to progress in national-level adaptation planning, finance and implementation worldwide”. Adaptation finance will be crucial in 2022, as will progress on the so-called Global Goal on Adaptation (GGA). Established under the Paris agreement, the GGA aims to create an adaptation equivalent to the global mitigation goal of limiting global temperatures to 1.5°C above pre-industrial levels. Encouraging indications come from the host of COP27, Egypt, which has said that it wants the next COP to focus on resilience and adaptation.
The building of Circular Economies around the world will accelerate in 2022 as tipping points for mass-market adoption of low-carbon solutions in areas such as cement, chemicals and steel come closer this decade. The EU is a leader in this regard, with the implementation of its circular economy action plan accelerating in 2022. The need to build a circular economy for plastics will remain a priority. Some countries and regions have started to address the issue of single-use plastic through legislation, with high-profile bans slated for 2022 in various countries, including Canada, France, India and Scotland. The US is also moving in this direction with the Break Free From Plastic Pollution Act. In addition to legislation, advanced technological solutions to integrate plastics into the circular economy will continue to gain momentum in 2022—from the first advanced chemical recycling facility for polystyrene in Europe to the first home electrical goods made from recycled ocean plastics.
The progress on biodiversity seen in 2021 will continue in 2022 as the regeneration of Ecosystems & Resources comes to the fore at the second part of the COP15 biodiversity conference in April/May. Progress is expected in all three key areas: land, forests and the ocean. On land, food sustainability and food security will remain high on the agenda, building on the momentum created by the first ever UN Food Systems Summit. Forests were a winner at COP26 amid a major global deforestation pledge. COP26 affirmed that ocean action is climate action, and 2022 will see further advances in areas such as sustainable aquaculture and blue carbon. These topics will be explored at the World Ocean Summit and the UN Ocean Conference in Lisbon. Biodiversity finance will also see further attention in 2022 as the joint Study Group on Biodiversity and Financial Stability publishes its full report. Meanwhile demand for minerals will remain high because of the ongoing proliferation of batteries, electronics and clean-energy infrastructure, underscoring the need for sustainable mining practices and secure supply chains.
Trust will be a cross-cutting theme of 2022—a major component of The Sustainability Project’s Social Sustainability pillar. A recent Edelman Trust Barometer revealed a profound lack of trust in governments, business and media when it comes to climate action. The theme of the World Economic Forum’s annual meeting in Davos, “Working Together, Restoring Trust”, will be at the heart of the global agenda during the year. Trust in institutions—including to engage in meaningful action on climate and sustainability—will be tested again at major elections in 2022, notably presidential and legislative elections in France, and mid-term elections in the US. On the corporate side, trust will continue to become an increasingly central issue in stakeholder relations, with the role of chief trust officer or its equivalent becoming more prominent in corporate decision-making.
We are hopeful that 2022 will continue to build further momentum during this urgent decade to ensure decision-makers turn commitments into action. To help that happen, policymakers, business leaders and communities can tap into The Sustainability Project as a platform for engagement, analysis and debate, convening and engaging global stakeholders with the power to effect real change in challenging times.
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