Despite landmark deals, work must be done to ensure emerging markets get back on track with climate fixing efforts after pandemic hurdle.
It is crucial that we stop deforestation as it’s the woodlands and forests provide the planet with vital breathable air and clean water.
Ingrid Kukuljan Head of Impact & Sustainable Investing
The commitment to end the destruction of the world’s forests by 2030 made at the recent COP26 United Nations climate summit in Glasgow is a pivotal moment in the battle against climate change, that’s the view of Ingrid Kukuljan, head of impact and sustainability at Federated Hermes.
‘So far, the most important thing that happened was the deforestation pledge,’ she says. ‘It is crucial that we stop deforestation as it’s the woodlands and forests provide the planet with vital breathable air and clean water.’
The international business of Federated Hermes, led by CEO Saker Nusseibeh was present at the World Leaders Summit and spoke passionately on the topic saying: ‘Forests provide two crucial things; first they are carbon sinks, they are also source of biodiversity. If you listened to the work of the scientists at the Natural History Museum in London you would be terrified.’
‘The rate at which we are destroying biodiversity on earth is actually bringing us to clear and present danger. It is therefore incumbent on all of us to save the future.’
‘So what are we doing about it? I sit here today as one of thirty firms that represent in total $8.7 trillion of assets under management and we have committed to eliminate commodity driven deforestation from our portfolios by 2025.’
The deforestation commitment will focus on cattle products, palm oil, soy, and pulp and paper production, and Federated Hermes have pledged to publicly disclose risks in portfolios, deepen engagement and increase investment in nature-based solutions over the next four years.
However despite this public progress, the pandemic has undoubtedly put a dent in achieving the climate-savings targets of COP26. ‘It’s already delayed the achievement of the sustainable development goals where we are facing a $2.5tn (£1.86tn) annual financing gap,’ Kukuljan notes.
Adding that the virus has had a negative impact on climate-fixing efforts by poorer countries, with many sustainability projects getting postponed owing to the economic shutdowns brought on by lockdowns internationally as the pandemic took hold.
‘The pandemic definitely put the emerging markets behind, and we need emerging markets to act to achieve our climate goals,’ she says.
That need for every country to pitch in is partly because many less affluent countries still rely heavily on fossil fuels such as coal and other non-renewable resources to produce electricity.
However for Kukuljan, the global publicity blitz surrounding the event and growing public support should go some way to help bring about the necessary change.
‘COP has brought awareness to the masses of the huge risks that we are facing as a society,’ she says. ‘There is a concerted effort to make changes that are needed for ourselves and future generations.’
The summit, which attracted close to 40,000 delegates from across the globe, could be bringing the change that environmentalists have wanted for decades. ‘I’m confident that there will be lasting impact after COP26,’ she says.
Of course, mass media coverage alone does not guarantee that anything will change. As is so often the case, creating a sustainable climate-friendly future will require everyone to pitch in. ‘The change has to start from us,’ Kukuljan says.
