COP27: EU doubles down on climate ambitions

November 18, 2022

The European Union has told world leaders at the COP27 summit it plans to update its already ambitious emissions-cutting target over the coming year.

The 27-country bloc’s upgraded mission statement will be aligned with the Paris Agreement, a legally binding international treaty on climate change, and is expected to come into effect before the next United Nations summit in New York in September 2023.

The EU - whose members include Germany, the planet’s sixth-biggest carbon polluter - is the world's third biggest polluter behind China and the United States.

But despite its ongoing battle with a crippling energy crisis for its estimated 447 million population, EU climate chief Frans Timmermans told those gathered in Egypt on Tuesday they remain committed to tackling global warming.

Catch up on all the latest developments at COP27:

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Timmermans, who leads the European Commission's work on the European Green Deal and its first European Climate Law, said they would continue to push EU nations to improve upon their nationally determined contributions (NDCs) by cutting emissions further.

The EU already has among the most ambitious climate change policies of major emitters, having committed to cut greenhouse gas emissions 55% by 2030, compared to 1990 levels, and eliminate them completely by 2050.

Without giving details of the new targets, Timmermans said: “The EU stands ready to update our NDC so don't let anybody tell you - here or outside - that the EU is backtracking.”

Timmermans' comments came on the same day the European Financial Reporting Advisory Group, a private association funded by the EU, approved the final version of the European Sustainability Reporting Standards (ESRS). This was well-timed for COP27, where many stakeholders are pushing for more stringent sustainability reporting requirements.

That framework sets out reporting rules on sustainability-related impacts, opportunities and risks under the Corporate Sustainable Reporting Directive (CSRD), which has been adopted by the European Parliament and is expected to be adopted by the EU Council this month.

It will expand the number of companies required to provide sustainability disclosures from 12,000 to more than 50,000, with a requirement for more forensic details on their impacts on the environment, human rights, social standards and sustainability-related risk.

The Timmermans pledge also comes a week after the Net Zero Asset Managers initiative (NZAMI), which was launched two years ago, revealed at COP27 that it has added 21 more members, taking its total to 291 who represent more than $66 trillion in assets under management (AUM).

New signatories including Northern Trust AM and AllianceBernstein have joined the group's commitment to help achieve net zero by 2050.

NZAM partner and Investor Group on Climate Change CEO Stephanie Pfeifer said: “The focus must now be on supporting managers to increase their targets and turning commitments into action.

“We need an emphasis on supporting real world emission reductions – without this, the likelihood of limiting temperature rises to no more than 1.5 degrees becomes more distant.”