What to expect at COP28

The world’s transition to net-zero carbon emissions is not moving fast enough. So says a UN assessment of collective progress at the halfway point—seven years after the Paris Agreement and seven years before the agreement’s 2030 deadline. A report on the assessment, which will say that the world is on a trajectory that falls far short of the Paris Agreement’s global-warming-reduction goal, is to be a cornerstone of the COP28 conference.

From November 30 to December 12, 70,000 public- and private-sector leaders, nongovernmental organizations, activists, and others will gather in Dubai for COP28, more formally called the 2023 Conference of the Parties of the UN Framework Convention on Climate Change (UNFCCC). Four themes for the event have been announced: fast-tracking the energy transition, transforming finance, inclusiveness, and putting nature, people, lives, and livelihoods at the heart of climate action.

During a McKinsey Live webinar, senior partners Daniel Pacthod and Cindy Levy discussed business leaders’ perspectives on whether COP28 could help shift the climate transition from aspiration and planning to bold action and real progress.

They outlined the principal topics that are at top of mind for private-sector leaders as the conference is about to begin:

1. Releasing the innovation required for new climate technologies that will support a greatly accelerated transition
2. Decarbonizing high-emissions sectors to reduce emissions while also reducing costs
3. Deploying the capital needed to fund the massive capital reallocation the transition requires
4. How the world can get on a path to an orderly transition

Moving the transition closer to the right trajectory will require any company’s navigations to result in carbon-emissions reduction, affordability, security, and competitiveness. In that context, it’s time for leaders to play offense on the net-zero transition. Three of the concrete way companies can do so include:

1. Enterprises of all kinds can build decarbonizing into their business models, invest in technology and create “decarbonization excellence” for the long run.
2. Accelerate the deployment of capital and other resources with a private-equity mindset while simultaneously decarbonizing hard-to-abate assets. Manufacture and design products and financial plans to reduce both costs and carbon.
3. Form coalitions within and across industries to address problems that individual institutions cannot solve. Build a new kind of partnership and ecosystem muscle for faster and more effective collaboration.
4. The benefits and burdens of making the climate transition inclusive—that is, taking account of its impact on jobs, energy affordability, economic competitiveness, and health outcomes—vary across the world. Inclusion poses a massive economic challenge that requires quantified metrics and better planning.
5. Embed net nature-positive in your value creation plans. It is no longer enough to be net-zero carbon emissions. Forward-thinking leaders are looking to invest now in nature capital.

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McKinsey will broadcast live from COP28, focusing each of 12 days on a different theme that’s integral to navigating and winning the net-zero transition; see the schedule and register here.

In addition, look for an upcoming report on the McKinsey Global Institute’s latest research, An affordable, reliable, competitive path to net zero, which will be available on McKinsey.com. Watch “Conversations on COP28” and review McKinsey’s COP Insights page.