The 27th edition of the Conference of the Parties (COP27) ended on Sunday 20 November 2022 in the seaside resort of Sharm El-Sheikh (Egypt). While some are talking about the historic progress made with the creation of a “loss and damage” fund, for many, this umpteenth COP is just a reminder of the inability of world leaders to agree on how to solve the climate issue.
Ineffectiveness of COPs
Since 1995, with a first edition in Berlin, 27 COPs have taken place. While the participants regularly welcome the agreements reached (including the Paris agreements in 2015), the concrete effect of these conferences on climate change is not as effective as we may think. Between 1995 and 2021, global greenhouse gas emissions increased by 58% and the holding of the various COPs does not seem to have influenced this trend.
As for previous agreements, their effectiveness is relative. For example, at the latest COP, the major breakthrough was the creation of a “loss and damage” fund to help the countries most vulnerable to climate change. From a symbolic point of view, this is an important step forward as it means that developed countries are acknowledging their responsibility in the climate crisis. However, from a practical point of view, the way this fund will be financed has still not been determined.
Finally, it is also possible to note that even after 27 conferences on climate change, there is still no agreement to phase down the use of fossil fuels, which is a major cause of greenhouse gas emissions and therefore of climate change.
The need to take action
In 2021, the concentration of CO2 in the atmosphere reached 414.7 parts per million (ppm), which is above the planetary boundary of 350 ppm. As a reminder, planetary boundaries are thresholds that must not be exceeded on a global scale in order for humanity to live in a safe ecosystem. On the nine global limits identified, six have already been exceeded with certainty in 2022 (one has not been quantified). They relate to climate change, biodiversity, disruption of biochemical cycles of nitrogen and phosphorus, land use change, chemical pollution and freshwater use.
Faced with this observation, the ineffectiveness of the COPs is all the more frightening and many citizens wonder what they can do about it. Without hoping to solve the problem through individual actions (the causes of the problem are above all structural), it is common to want to “do one’s part”. This raises the question of the global levers for action.
Finance as a lever for action
There are many ways to take action in the fight against climate change. For example, you can start by taking five minutes to calculate your carbon footprint by answering the ADEME (The French Agency for Ecological Transition) questionnaire (nosgestesclimat.fr) and see what actions you can take. The average carbon footprint of French people is 10 tons per year per inhabitant. It should be reduced to 2 tons per year per inhabitant to comply with the Paris agreements.
However, as this type of questionnaire focuses on consumption habits, it is common to forget that it is also possible to have an impact through our investments. It is therefore advisable to find out about the companies in which our money is invested in order to favor those that have a positive impact on the environment, which is what we call sustainable finance.
At Neuroprofiler, we try to activate this lever by enabling financial institutions to better understand their clients’ ESG investment objectives. Thanks to our ESG questionnaire, we can assess investors’ ESG preferences in an accurate and user-friendly way. Our ESG preference assessment module complies with the latest published regulations while using all the levers of cognitive science to make this assessment accurate and fun.