Encouraging Developments & Forward Momentum

By Matthew Bishop

A mix of gridlock and optimism landed on Manhattan’s streets last week as political, business, and civil society leaders from around the world arrived for the annual deliberations at the United Nations General Assembly (UNGA) and Climate Week. While the progress discussed in these meetings has not exactly been fast, I was encouraged that, unlike on New York’s roads, there was some genuine forward momentum. This was especially true of the private-sector-led conversations. The more politicians in the room and the closer I got to UN HQ, however, the gloomier the mood felt.

Eight years into the 15-year period for achieving the 2030 UN Sustainable Development Goals, the rallying cry for the week was “Winning the Second Half.” This implicitly recognizes that progress has been so slow that there is little chance of achieving the SDGs on time. (Indeed, my colleagues at the Social Progress Imperative, which I co-founded, calculate that, on current trends, they won’t be achieved this century.) Some at the UN HQ feel things are so bad it is time to ditch the goals. Still, for believers, the challenge for the remaining seven years is to demonstrate clear momentum in the right direction — in soccer terms, enough to turn a 3-0 halftime deficit into an honorable 3-2 defeat that will give hope for future contests in the post-2030 years.

Talk of the Town: Nature Markets, Institutional Buy-In, Energy

With the private sector increasingly moving beyond slogans to detailed discussions of how to drive progress on the SDGs, several key takeaways emerged.

• Creating and Investing in “Nature Markets”: One key topic threading through the event was the need to develop new — and adapt old — financial instruments to help direct private capital to initiatives that preserve and strengthen the natural world, especially those aspects of nature that can sustainably underpin human economic activity. I was especially encouraged by the presence of leaders from Indigenous peoples around the world with a clear sense of how nature markets might finance their efforts to steward nature and thus fight back against capitalism’s traditional penchant for extracting value by destroying nature. One crucial practical topic much discussed was what to learn from the widespread greenwashing in existing green bond and carbon credit markets to ensure that expanded nature markets really do strengthen nature.
• Change at the World Bank: In various appearances, incoming president and ex-MasterCard CEO Ajay Banga made a good first impression, signaling a determination to reform and turbocharge the role of the Bank, particularly as a catalyst of investment in a sustainable, inclusive post-carbon economy. It will require lots of hard work to make that a reality, but it’s a good start.
• Funding the Energy Transition: The most surprising thing I heard was from a Department of Energy official involved in distributing billions of dollars of Inflation Reduction Act (IRA) money to the energy transition. According to them, lots of money is being left on the table because so many investors don’t seem to have made the effort to understand the details of what is being offered. If reading the IRA itself may be too daunting, there are handy guides from the likes of McKinsey and Goldman Sachs, the official advised.

Optimism and Concerns Over Political Impacts

The complex political climate is a factor in sustainability efforts across the globe, driving reactions ranging from optimism and determination to concern.

• Inflation Reduction Act Impacts: The stimulative effect of America’s Inflation Reduction Act and the response it has triggered from the European Union has created a positive mood around renewable energy. Former Vice President Al Gore was more upbeat than I have ever heard him about the inevitability of the transition to a post-carbon economy (though still warning that it is not yet moving fast enough, especially given the growing evidence that climate change is having some nasty irreversible effects).
• Anti-ESG Effects: Due to a political backlash against “woke capitalism,” big business leaders may be toning down their public championing of ESG and the SDGs. But those I talked with privately insisted that they are continuing to change how they do business to align with climate targets and the SDGs. If anything, the backlash seems to have strengthened their determination even as it has silenced their corporate tongues.
• U.S. Presidency: In my conversations, I encountered plenty of optimism, at least until I mentioned the looming U.S. presidential election, now widely viewed as the most significant risk factor facing the world in the next year or so.

Tech Shows Up in a Big Way

The tech innovation world was more involved in the citywide event than in previous years.

• Exploring Green Tech Solutions: Loads of green tech companies brought real solutions ranging from ways to suck carbon out of the atmosphere and bury it deep underground to satellite-based systems to monitor carbon emissions accurately at the source. At a time when the world is worrying about the existential threat of Artificial Intelligence, several entrepreneurs have developed AI for Good products they believe can accelerate progress on the SDGs.

Lingering Questions over COP28

Next, world leaders will turn their attention to the upcoming COP 28 meeting in the United Arab Emirates. There is not much optimism about this, especially given that the head of the Gulf State’s oil operations is playing the leading role. Still, as various people in New York observed this week, while the UAE may be allergic to the idea of a post-carbon economy, its leaders also want their COP to be seen as a success. And they can afford to throw a vast amount of money at something. What, I wonder, will be the lucky winner of the multi-billion-dollar COP lottery?