Policy Taskforce to Drive Government Action on Net Zero
Appointments signal growing momentum behind UN-sponsored efforts to promote policy consistency and support non-state actors’ commitments.
The recently-confirmed members of a taskforce created to increase the quality and consistency of private sector net zero pledges are targeting COP29 for their assessment of enabling environments in Group of 20 (G20) countries.
The Taskforce on Net Zero Policy will play a pivotal role in ensuring policymakers effectively enable a collaborative and just transition which supports the decarbonisation plans of investors and companies around the world, according to Margarita Pirovska, Director of Global Policy at the UN-convened Principles for Responsible Investment (PRI), which is providing its secretariat.
“This is the time for action,” Pirovska told ESG Investor. “The taskforce wants to draw all governments’ attention to and drive action on net zero policy.”
Last week, the taskforce announced the constituents of its board of trustees, as well as members of a technical expert group drawn from fields including change mitigation and climate adaptation, and corporate and financial regulation. The board of trustees includes Catherine McKenna, former Canadian environment minister, Eric Usher, Head of the UN Environment Programme Finance Initiative, and Klaas Knot, Chair of the Financial Stability Board.
Launched at COP28, the taskforce is a direct response to 2022’s ‘Integrity Matters’ report from the High-level Expert Group (HLEG) on the Net Zero Emissions Commitments of Non-state Entities, which was led by McKenna. The report included a recommendation to accelerate the road to regulation through the formation of an enabling policy environment for non-state actors.
The taskforce aims to ensure the credibility and accountability of 1.5°C-aligned net zero emissions commitments by non-state actors by driving policymakers to adopt robust and ambitious policies.
“The work of the taskforce will be instrumental to facilitate effective non-state entities’ action and net zero policy coherence,” said Co-chair Andrea Meza Murillo. “The transition to inclusive net zero economies and societies requires comprehensive approaches, consideration of different sectors, and robust policy and legal frameworks to avoid greenwashing, and to achieve climate-nature-land-development goals.”
The taskforce plans to publish a global stocktake-style report at COP29, which will map the relevant financial, corporate and real economy policies of G20 countries against the HLEG’s ten recommendations.
“There are a lot of good things happening in different countries on different aspects of net zero policy,” Pirovska said. “We need to outline these and also identify the challenges and the gaps.”
The taskforce will also be looking at the cross-border impacts of policymaking on vulnerable and low-income countries from a just transition perspective.
Net zero policy misalignment
The core objectives of the taskforce are to establish a collaborative space that encourages knowledge sharing and identifying opportunities within regulatory frameworks that support the implementation of the HLEG recommendations. Its work will cover multiple sectors, including financial institutions and corporates.
“PRI signatories are concerned about misaligned net zero policies globally, as well as governments committing to goals and then not driving policy reform fast enough to support those targets, giving contradictory signals to the market,” said Pirovska. “Whether they are an asset owner, asset manager or service provider, they all face this changing world which is undeniably impacted by the transition to net zero.”
As such, it’s crucial that governments embed their net zero goals alongside other targets which will drive an effective transformation of economies in a way that is beneficial to investors and companies, she continued.
“It’s a very complex task ahead, which is why we need the broad partnership that the taskforce enables to empower actors so that, by COP29 in Azerbaijan, we at least have a baseline as to where policy stands and we can figure out what’s next,” Pirovska said.
The taskforce’s expert group is made up of technical experts working in fields relevant to the HLEG recommendations, including corporate and financial regulation. Members will help shape the work of the taskforce by providing guidance, research and analysis.
The expert group includes Nick Robins, Professor in Practice for Sustainable Finance at the LSE Grantham Research Institute on Climate Change and the Environment (LSE GRI), Simon Dikau, Distinguished Policy Fellow on Central Banking and Financial Supervision at LSE GRI, Tom Hale, the Co-director of the Oxford Martin Programme on Net Zero Regulation and Policy, and Thom Wetzer, Director of the Oxford Sustainable Law Programme.
The taskforce board includes Sabine Mauderer, Chair of the Network for Greening the Financial System, Jo Tyndall, Director of Environment at the Organisation for Economic Co-operation and Development, and Jingdong Hua, Vice Chair of the International Sustainability Standards Board.
Investors’ levers
The PRI will be responsible for enabling the work of the taskforce and its newly appointed technical expert group – for instance, by sharing research.
“At the PRI, we have developed substantial sustainable finance and policy expertise,” said Pirovska. “When the HLEG proposed that the PRI should support the implementation of its tenth recommendation, we were more than happy to take on the opportunity.”
Governments signed up to the Paris Agreement are due to submit their updated nationally determined contributions in 2025, following their existing iterations being labelled inadequate at COP28.
Last year, a synthesis report published by the United Nations Framework Convention on Climate Change highlighted the shortcomings of policy action to date.
A 2023 Inevitable Policy Response (IPR) forecast of global climate policies commissioned by the PRI projected that, although temperatures are expected to remain well-below 2°C, they will likely peak between 1.7°C and 1.8°C. The IPR said only 3% of global policies were moving towards a 1.5°C low or no overshoot target.
“Investors have different levers they can pull to support their sustainability-related goals,” said Pirovska. “They can allocate capital to support their beliefs and objectives, but for investors who are committed to net zero, this alone is not enough. Stewardship is vital to make sure that large parts of the economy which are not net zero-aligned are on an effective transition pathway to net zero.”
Even so, engagement with corporates alone is not enough to drive the rapid scale of change necessary, she said.
“Investors also need to clearly support policymakers on this difficult path ahead to figure out what are the good policies that can drive markets effectively to net zero,” Pirovska noted.
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