COP28 in the UAE offers a “pivotal and unmissable” opportunity to correct course and accelerate global climate action, Ahmed Abdelaal, Group CEO of Dubai-based bank Mashreq told Zawya.
“Unless the nations’ representatives present in Dubai right now truly commit to taking more transformative climate action and adopt stronger policies, the world will witness the devastating reality of global temperatures soaring between 2.5C and 2.9C in the next few years,” he said in response to questions from Zawya.
COP28 is particularly relevant and will be of true historical significance among COPs, since Dubai will soon become the place where the world’s first-ever Paris Agreement’s Global Stocktake concludes, Abdelaal said.
The decisions made at COP28 will formalise guidance and commitments for countries in developing their future climate actions from 2024 onwards.
The summit is crucial for achieving net zero targets set by the Paris Agreement, although potential alternatives to COPs exist, such as regional agreements or industry-specific efforts, Abdelaal said COPs continue to be an important platform for global consensus.
Mashreq and other UAE banks play a pivotal role in advancing national emissions targets and the Paris Agreement’s goal of limiting global warming to 1.5 degrees Celsius, he said.
“We align our financial resources with the Paris Agreement’s goals and actively create funding structures to support emissions reduction projects. Collaboration with clients and policymakers is also essential in achieving a net-zero emissions future.”
Regional corporations face challenges such as limited awareness of net-zero concepts, affordable clean energy sources and technologies and financial constraints.
In the banking industry, challenges include the rapid pace of technological advancements, a limited track record, and a lack of clear international standards, hindering the bankability of projects needed for decarbonisation.
Moreover, the lack of clear and detailed international standards can hamper the bankability of projects needed to decarbonise economies.
“Project finance is essential to moving this sector forward, but regulatory and policy improvements must keep pace if project finance benefits are to be fully realised,” he said.
COPs have undeniably played a vital role in raising global awareness about climate concerns and promoting international cooperation.
They have been instrumental in advancing the goals of the United Nations Framework Convention on Climate Change (UNFCCC). However, there are valid concerns about the slow pace of negotiations and the need for more ambitious promises.
“It is essential to recognise that COP meetings are fundamental to the global climate governance framework,” the CEO said.
COPs are critical for the success of international collective efforts against climate change. Discussions about alternatives or modifications to the COP process would likely take place within the international community and the UNFCCC itself as part of broader conversations.
Other corporate challenges include the availability of reliable and standardised data on sustainability and ESG factors.
“Without a consistent framework for reporting and measuring ESG performance, it becomes difficult for companies to collect and analyse data effectively,” Abdelaal said.
Additionally, the lack of integration between different data sources and systems can hinder the capture of continuous and real-time data. And, ensuring data accuracy and completeness can be a challenge, as it requires robust data management processes and systems.
Mashreq has committed to reach a goal of providing $30 billion in sustainable financing by 2030.
Partnerships with initiatives such as Science-Based Targets solidify its position in industry sustainability, Abedelaal said, adding that collaborations, such as the “Notice Nature” wildlife mapping initiative and the climate banking platform with Visa and ecolytiq, demonstrate Mashreq’s active contribution to the UAE’s green agenda and broader sustainability objectives.
“We are actively collaborating with the UAE to achieve its net zero target through a range of initiatives and partnerships,” he added.
“By supporting the UAE government’s green agenda and contributing to broader sustainability objectives, Mashreq is actively promoting a greener future.”
The bank is dedicated to spearheading the region’s sustainability journey and playing a pivotal role in achieving the UAE’s net-zero target by 2050, he concluded.
(Reporting by Imogen Lillywhite; editing by Seban Scaria)