The theme for the 2024 World Economic Forum in Davos is “Rebuilding Trust,” a timely choice given the pledge that 190 nations made at last year’s UN climate conference (COP28) a few months ago to transition away from fossil fuels. The gathering at Davos is an opportunity for the government leaders and powerhouses in business and culture in attendance to take on the challenge of delivering this promise of a clean energy transition. The World Economic Forum is putting its stated goal of driving trust and accountability to the test, and the world is watching.
Like many in the environmental NGO community, I was disappointed that COP28 did not deliver a more decisive call for a full phase-out of oil, gas and coal. The language from the COP agreement still leaves ample room for those with fossil fuel interests to dither and make excuses. Nonetheless, this is a historic commitment and the first time the COP officially acknowledged that burning fossil fuels is at the heart of the climate crisis. This agreement is a positive affirmation of the parties' commitment to the energy transition, but at best it's a milestone, not an outcome. Now that countries have publicly pledged to decouple their economies from fossil fuels, triple renewable energy and double energy efficiency investment, the natural question is whether the parties are going to follow through on their promises.
The shortcoming of the Paris Agreement is that there is no enforcement mechanism. No United Nations body can prohibit a country from expanding its use of fossil fuels or penalize it for failing to meet its COP commitments. This is why it’s critical for the leaders of finance, industry and civic society at Davos to hold countries accountable. One way for them to do that is through the process of Nationally Determined Contributions (NDCs), whereby individual countries proclaim their carbon emission reduction goals and establish action plans for delivering on them.
Business leaders must weigh in on what is included in their country’s NDC and commit to making major, immediate course corrections. After all, companies account for a large percentage of global carbon emissions. They must lead the way by walking the talk on transparency, consistency and accountability for their carbon emissions. Efforts like the global nonprofit “Fossil to Clean” campaign, which aims to drive the necessary business and policy action to cut emissions in half by 2030, represent a good start.
It is said that trust may be had where we find the marriage of word and deed. If the World Economic Forum means to "rebuild trust" on the world stage, leaders across every sector of society must reject equivocation and excuses, take up the yoke of change, and start pulling. Who among the many movers and shakers at Davos will lead the way?
Of course, businesses can’t do it alone; government policy is needed to create the enabling conditions for lasting, large-scale change. The first and most concrete action that countries can take to prove the seriousness of their intentions is to eliminate fossil fuel subsidies. The time has come to rein in public financing for the production and use of fossil fuels. Countries must invest those subsidies into clean energy infrastructure. The International Monetary Fund has stated that governments spent a whopping $1.3 trillion last year in "explicit" fossil fuel subsidies by undercharging for the cost of supplying fossil fuels to consumers and businesses. If "implicit" subsidies from local air pollution, health costs and damage from climate change are included, that number rises to a record $7 trillion. Removing fuel subsidies can be tricky, but countries can design their NDCs to create new fiscal systems that allocate a portion of increased revenues to compensating vulnerable households for any subsequent rise in energy prices.
With the trillions from subsidy savings, we can begin to change how we generate energy, improve how we distribute it, reduce how much of it we use, and reinvent how we manage the processes around every aspect of our energy economy. The same goes for transportation, agriculture and the built environment.
From Davos until the world meets again for COP29 in November, the inquiry we need to make at every gathering of world leaders is this—can we trust you to undertake the actions to execute on all the promises to transition away from fossil fuels? Will you be transparent with us about what steps you are taking to triple renewables and double our efforts around energy efficiency? The 60% emissions reduction that must be achieved in the next round of NDCs is a significant undertaking. Goals like these require large scale plans that deliver maximum benefits in a small amount of time. And we need to do this while still making every effort to minimize negative impacts to communities and to nature. These are big tasks that require a big commitment of cash and resources. We know we can redistribute the money we currently spend supporting the fossil fuel economy—if we have the strength of our convictions to demand it.
It is said that trust may be had where we find the marriage of word and deed. If the World Economic Forum means to "rebuild trust" on the world stage, leaders across every sector of society must reject equivocation and excuses, take up the yoke of change, and start pulling. Who among the many movers and shakers at Davos will lead the way?
