Executive
Perspectives
BCG is proud to be the exclusive consultancy partner to COP26

Inside COP26: Kickstartinga decade of delivery
November 2021

BCG Executive
Perspectives

Context

AGENDA

Implications for business leaders

Copyright © 2021 by Boston Consulting Group. All rights reserved. BCG Executive Perspectives updated 15 November 2021 Version 2.0

OVERVIEW

Key wins and remaining challenges

DEEP DIVES
Outcomes in each area and specific implications
Overarching global initiatives

1

~50%

Copyright © 2021 by Boston Consulting Group. All rights reserved. BCG Executive Perspectives updated 15 November 2021 Version 2.0

Going into COP26, the science called for a step-change in approach

Reduction in emissions required by 2030 to limit warming by 1.5 o C by 2100, in line with Paris Agreement aim to limit
average global temperature increase to "well below 2⁰ C" and "pursue efforts for 1.5⁰ C" above preindustrial levels

Warming well underway

Significant risk to human life

High economic cost

1.2oC

2.7oC

800M

~1.7Bn -25%

Current increase in

Warming projected byPeople at risk fromrising sea levels on

People experiencing
severe heatwaves on

global averagetemperatures above
preindustrial levels

2100 with pre-COP26
policies

pre-COP26 trajectory

pre-COP26 2.7oC
trajectory

Source: IPCC As s es sment report 2021; Climate Action Tracker; UNEP Em issions Gap Report 2021; Guardian; National Bureau of Economic Res earch; Clim ate Action Tracker; BCG

Loss in GDP by

2100 on current climate
trajectory2

COP26 faced headwinds: hopes were high but expectations low

Nov
July
ember
19, 202,21
2021

Catastrophic flooding acrossGermany and neighboring countries
left more than 160 people deadYet skepticism remained around achieving progress at COP26
July 23, 20 21‘Nothing left’: A catastrophe in
Madagascar’s famine-hit south

September
Nov ember 20
2, 2021, 2021

Glasgow Climate Summit Faces‘High Risk of Failure,’ U.N. Leader
Says

September
Nov ember10
2,,20212021
Copyright © 2021 by Boston Consulting Group. All rights reserved. BCG Executive Perspectives updated 15 November 2021 Version 2.0

We witnessed major climate disasters in 2021

Pivotal climate summit dogged by
COVID and equity concerns

High hope and demand for change
September 25, 20 21

World's youth take to the streets
again to battle climate change
Sources : Pres s releas es

August 9, 20 21

Global warming will hit 1.5C by
2040, warns IPCC reportAugust 2, 20 21

With Time Ticking Down, Hope Is
Waning for a Climate Deal

September 27, 20 21

Cop26 talks will not fulfil aims of
Paris agreement, key players warn
3

COP26 MADE PROGRESS IN KEY AREAS AGAINST SIGNIFICANT HEADWINDS

Progress madein key areas, butessential to keep
up momentum

90% of world now committed to net zero after pledges from India and others"Paris Rulebook" completed: creation of international carbon market and stricter emissions disclosures"Phasing down" of coal and fossil fuels highlighted for the first time in a COP final agreement
Copyright © 2021 by Boston Consulting Group. All rights reserved. BCG Executive Perspectives updated 15 November 2021 Version 2.0

1
2
3
4

Joint policy commitments on deforestation, methane, and international coal financing

5

Reinv igorated international collaboration: joint US-China declaration on climate collaboration,$8.5 billion Just Energy Transition Partnership for South Africa, etc.

6Priv ate sector mobilization: 5,200+ businesses and approximately 450 financial institutions (40% of
financial assets) committing to science-based net-zero targets

7

Growing priv ate-public collaboration including global initiatives to develop, scale, and deploy thetechnologies required to address hard-to-abate sectors

8
9

Steps toward robust and transparent disclosure and reporting of private sector plans
Agreement for developed countries to double collectiv e funds for adaptation by 2025 1

IMPORTANT TO BUILD MOMENTUM POST-COP 26, INCLUDING:

1
2
3
4

Revisiting national ambitions on mitigation more frequently in the 2020s, accelerating the 'ratchet'
Rapidly developing and implementing just and effectiv e policies to deliver on ambition

Developing robust and transparent priv ate-sector abatement plans and making short-term progress
Formulating effective adaptation plans – which, together with 'loss and damage' likely to dominate
COP27

1. Bas ed on 2019 pledges; Sources: CO P26 announcements , BCG

4

Guinea delegateo n b ehalf o f G77

Launch of the First Movers Coalition
Defo restation pledge

Lo ss & Damage rising up the agenda, with more to do~40,000
delegates“Yo u are deciding whether my generation will get to liv e ina habitable wo rld; you are deciding whether we are wo rthfighting for.... ” - Vinisha Umashankar, 15 from India
India's Net Zero pledge
Civ il society & youth participation

Disappointment felt by much of society

Methane pledge launch

US 's Jo hn Kerry andChina's Xie Zhenhua

Re-invigorated international collaboration

100+
world
leaders

Finance mobilization
Finance secto r m o bilization

Paris Rulebook completeStronger public-private
link
Public-private
co llaboration
End o f co al accelerated, but not definitively

5Engagequicklyand setdirection

Collaborate
with yourecosystem

1

Quickly mov e beyond pledges to action: Start with baselining and ‘de-av eraging’ your emissions across the value chain andby country1, understand what it takes in each stage to align to 1.5oC

2Adapt your assets and operations for a warmer world:
Prepare for impacts relating to loss and damage3

Prepare for dev iations in local transitions, but do not wait to take action
If you pursue consistent global climate ambition, prepare for and navigate challenges locally4

Explore unique opportunities to compete for market share in a low-carbon economy.
Driv e innov ation, leverage new government programs and public-private initiatives

5

Work with policy makers and local governments to set a 'lev el playing field', align advocacy agenda with climate commitments

6

Collaborate with, co-inv est in, and promote incentiv es for players across the v alue chain to adopt climate-friendly practices andsupport early demand signals for clean technologies2

7

Raise awareness and educate the end consumer – to capture value over time (e.g., price premiums)
Engage with and listen to youth actors – to create open and constructive dialogue and secure "social licence” to operate8
Wire
the wholeorganization 9

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Key takeaways for business from COP26: make bold moves, embed theclimate transition, and accelerate change through ecosystems

Build adaptation and resilience into your business plans and operations.

Bring employees on the journey early on: embed climate culture in behaviors, L&D, incentives, and workforce planning
Don't treat climate in 'siloes': (i) set an operating model with consistent sustainability initiatives and targets across divisions, (ii) drivestrong climate accountability and progress tracking; (iii) embed in capital planning practices, financial assumptions, and ROI assessment

1. Cons ider the depth of S cope 1 and 2 emissions, and the breadth of Scope 3 emissions; 2. Especially where there is no current s olution at scale or where infrastructure is critical
S ou rce: COP26 discussions and announcements; BCG experience and analyses

6

Looking ahead | Monitor developments in climate tracking and reporting,carbon markets, voice of civil society, and adaptation

IFRS International Sustainability Standards Board – work on minimum ESG disclosures

Consistent climatetransparency requirements

UK corporate requirements to report net-zero transition plans1 – potential to set precedent

Expect more stringent monitoring

Tightening of SBTi framework2: Increased minimum ambition in corporate target setting to ‘1.5°C’3

Climate policy commitments

EU's Fit for 55 (proposed actions to reach EU's 2030 goal) – including EU Carbon Border Tax proposal

Likely to incentivize curbing emissions,and speed up innovation and deployment

US upcoming legislation (e.g., Build Back Better Act: $500 billion to combat climate change in draft)

Voice of civil society

Civ il society increasingly leading calls for more ambitious climate action such as YOUNGOExpect higher demand for sustainableproducts, climate transparency and circularity

Consumer demand: 23% of consumers say they are buying more sustainable products today (vs 2019)4

Increasing focus on adaptation COP27 Egypt likely to focus on adaptation, resilience, and 'loss and damage' funding
Likely closer scrutiny by stakeholders on
resilience of business operations

Launch of new frameworks for transparency on country, corporate, and supply chain
resilience (such as UN Global Resilience Index, Race to Resilience metrics framework)

1. From 2023; 2. S cience Based Targets initiative (SBTi), the global body enabling businesses to set emissions reduction targets in line with climate s cience; 3. Previously was 'well below 2 oC. 4. Ques tion text: “Which of the following bes t des cribes how much you are doing each of the following
activities today compared with before the CO VID-19 pandemic (i.e., 2019)?” ; BCG CO VID-19 Cons umer Sentiment Survey, May 2021. (N = 4,558, unweighted, repres entative within ~3% of the US census)

7

Copyright © 2021 by Boston Consulting Group. All rights reserved. BCG Executive Perspectives updated 15 November 2021 Version 2.0

Four main areas with direct business impact

BCG Executive
Perspectives

Context and areas of focus

AGENDA

Implications for business leaders

Copyright © 2021 by Boston Consulting Group. All rights reserved. BCG Executive Perspectives updated 15 November 2021 Version 2.0

OVERVIEW

Key wins and remaining challenges

DEEP DIVES
Outcomes in each area and specific implications
Overarching global initiatives

8

Context | Paris Agreement set the goal and framework for mitigation
and adaptation, and was ratified by 196 countries

OUTCOME

Copyright © 2021 by Boston Consulting Group. All rights reserved. BCG Executive Perspectives updated 15 November 2021 Version 2.0

COP26 is the 26th conference of the parties to UNFCCC1 through which the international community seeks to address climate change
At COP21 in Paris, parties agreed to hold the av erage global temperature increase to "well below 2o C", "pursue efforts for 1.5 o C"
(mitigation) and establish a global goal on adaptation. Given developed countries were responsible for approximately 80% 2 of historicalemissions, parties agreed on "common but differentiated responsibilities" for developed and developing countries.

MITIGATION

ADAPTATION

Agreed efforts to reduce emissions globally, inline with best available science—approximately
45% by 2030 and net zero by mid-century

Strategies to enhance adaptive capacity,strengthen resilience, and reduce
vulnerability to climate change

TRACKING

Nationally Determined Contributions (NDCs):
2030 emissions reduction targets and post-2020 climate actions

Each party needs to plan and report on its intent through
NDCs and LTS to the Secretariat on a five-year cycle.
No mechanism forces a country to set specific targets,but each target should go beyond prev ious targets.
Parties agreed to progressively revise NDCs every five years

Long Term Strategies (LTS): Articulate mid-century climate anddevelopment goals

COP26 in Glasgow is the first Conference of the Parties since the first five-year deadline for revisions
1. UN's Framework Convention on Climate Change; 2. Center for Global Development

9

Priorities going into COP26 | Keep 1.5o C within reach via a combination of policy
and private action, with four areas of focus accounting for 50%+ of emissions

Ambition &acceleration

Complete "Paris Rulebook," deliver $100 billion financing to developing countries, accelerate "ratchet"

NaturePolicysupportPrivateactionCopyright © 2021 by Boston Consulting Group. All rights reserved. BCG Executive Perspectives updated 15 November 2021 Version 2.0

Update NDCs to narrow the emission reduction gap to 2030

6% 1

Deforestation |Avoid and reverse
deforestation

Finance |EnergyTransport

~20%1

20%1

Methane |Coal |

Reduce methane emissions

Mobilize private finance via Glasgow
Financial Alliance for Net Zero (GFANZ)

Phase out coal

7% 1

Automotive |Phase out internal
combustion engine

Corporate |Commit to Net Zero, including via Race to Zero

1. Bas ed on ~53 Gt global GHG emissions, 2019; For methane: estimated Co2 equivalent based on: 342 mton/yr and x28 more powerful than CO2 on a 100 year view and 86x in the 20 year view (taking into account their natural degradation in the atmosphere);
Note : Does not represent the position of the UK Presidency; Source: CAIT; IEA; World Energy Outlook; GHG Protocol; BCG analysis

10Outcomes | Overdelivered given the politics and underdelivered given the science

Quick action, transparency, and tangible results are key next steps
Ambition and acceleration | Glasgow deal overdelivered on expectations. Paris Rulebook complete including global carbon

Early COP26 reflections

Rich Lesser, BCG Global Chair:

1 market. 90% of world now committed to net zero (vs 30% in 2019); US-China issued joint declaration on climate collaboration
But limited progress on loss and damage, failure to deliver $100 billion pledge, and still insufficient 2030 commitments

2 Deforestation | 141 governments pledged to reverse deforestation by 2030 - critical to building coalitions and transparency
3 Methane | Strong pledge from 105 governments can facilitate 'quick win' on abatement – important to deploy existing tech
4 Coal | Coal phase-out pledge not signed by major coal emitters, but halting coal funding by 2022 is a positive sign

Michel Frédeau, BCG Centerfor Climate & Sustainability:

5 Auto | Industry commitments in 2021 accelerated shift to EVs2; but major governments did not sign ZEV3 pledge
6 Finance | ~450 financial institutions ($130tn AUM4) committed to net zero; step toward standard ESG reporting
7 Corporate | 5,200+ firms joined Race-to-Zero campaign, now need to shift from commitment to tangible action
Collaboration | A number of global initiatives aim to bridge early demand gap and accelerate tech across high emission
8 sectors(including Glasgow Breakthroughs, First Mover Coalition, Breakthrough Energy Catalyst, Green Public Procurement)
1. NDCs = Nationally Determined Contributions (2030 emissions reduction targets and pos t-2020 climate actions); 2. Electric Vehicles ; 3. ZEV = Zero Em ission Vehicles 4. AUM = as sets under management
Source: CO P26 announcements , BCG analys is and experience11

Copyright © 2021 by Boston Consulting Group. All rights reserved. BCG Executive Perspectives updated 15 November 2021 Version 2.0

Major progress on multiple fronts. Governments increased commitments in some critical areas but fell shortin others. Strong optimism from private sector mobilization and stronger public-private links.

Governments | ~90% of world now committed to net zero and Paris rulebook
now completed, but still a large abatement gap and unmet $100bn pledge

Focus on targeted
investments alongside
MDBs 8 or public funding(e.g., SA transition)

Choose initiatives(among vast number)that can truly drivechange in local
regions and sectors

Determine potential
implications for yourbusiness and identify
source of advantage

Deploy reskilling
programs for workforce
in sectors mostimpacted (like coal)

Pledges & targets+2.1°COp tim istic s cen ario
+1.8°C01.5 °C Co n sistent

-10
-20

2090
2100

4 Just transition+2.4° C

2080

3 Focus on nature

20 30 targets only

20 30
Am bition gap
19-23 GtCO2e

2070

2 Right initiatives+2.5-2.9°C

30

10

1 Investments

Po licies & Actio n

Copyright © 2021 by Boston Consulting Group. All rights reserved. BCG Executive Perspectives updated 15 November 2021 Version 2.0

4020Developed countries agree to double collective adaptation
finance by 20256

Factor in climate
becoming part of tradenegotiations

50

2100 Warming
projections 4

Historical

2060

Request for countries to review and strengthen NDCs 5 in
2022; phase down of coal and phase out of inefficient fossil
fuel subsidies$100 billion funding commitment
was still not delivered – yet theimportance of this was reiterated in
the decision text

60

2050

Completed Paris Rulebook, Article 6's rules oninternational carbon markets and emission disclosures

70

2040

US-China joint declaration to cooperate on methane,
decarbonization, deforestation and energy transition4

Global GHG 2 emissions (GtCO2e/year)42030

Loss and damage: Standalone
fund rejected by developed nations(including US, EU, Australia) – butloss and damage now firmly on COP
agenda2020

India pledged NZ by 2070, 1Gt GHGe2 reduction by 20303

Mid-COP26 analysis showed latest 2030
commitments could deliver 2.4oC trajectory

2010

But two areas fell short

2000~ 90% of world GDP now covered by net zero1

1990

Business implications

Progress made, by large emission
reduction gap remains

1

Action is critical to realize this and further potential

1. Versus 30% in 2019, 2. Green house gas emissions, 3. Along with 50% of 2030 energy from renewables and 45% reduction
2 intensity
in CO by 2030, 4. Encouraging decarbonization, mitigating methane emissions, maximizing benefits of clean energy transition ande liminating global ille gal deforestation, 5. Nationally Determined Contributions (NDCs): 2030 emissions reduction, 6 . From 2019 levels by 2025 targets; 7. Climate Action Tracker November 2021 update; 8. MDB = Multi-development banks ;S ou rce: COP26 announcements, Climate Action Tracker, press releases

12Governments | Despite some progress and commitments at COP26,
adaptation efforts remain underfunded – driving an urgent need to act

COP26: Positive signs from measurement launches and funding pledge

But adaptation still underfunded

UN Race to Resilience metrics framework launched – to measure resilience work progress

Only about $50bn deployed in 2020 (only 8% of
total climate financing2)

Global Resilience Index launched to offer transparency on country, corporate, supply resilience
Dev eloped countries agree to double collective adaptation finance from 2019 levels by 2025

Much lower than required about $180bn pa by
2030

New funding by some developed countries: £290m from the UK; about $15m funding for NAP1

Low priv ate-sector funding for adaptation ($2bn)3

Non-state actors lead the way on loss and damage, Scotland: first subnational fundYet some multilateral v ehicles of concessional
finance set up –Adaptation Fund, ADF4, etc.

1

Across industries

Build into your business operations
Invest in early warning signs to avert
and minimize damage
Work with governments and industry tocodevelop investable adaptation
projects considering investor returns

2 Investors

3 FoodAssess and factor-in vulnerability
and climate impact on operations andsupply chains into business decisions
Leverage emerging frameworks

2

4 Energy

Innovate, such as drought-resistantseeds

Investigate how climate mightchange energy demand

Diversify and insure crops and stock

Build resilient infrastructure andback up electricity capacity

Encourage judicious fertilizer use,
nutrient management, and soil
testing to improve fertility

Copyright © 2021 by Boston Consulting Group. All rights reserved. BCG Executive Perspectives updated 15 November 2021 Version 2.0

Business implications

Some progress, but
still insufficient funding

1

Adaptation and 'loss & damage' expected to be the focus of COP27 in Egypt
1. National Ad aptation Plan Global Network – from Canada, US, Germany, UK, Ireland, 2. e.g., Global Resilience Index, Green Climate Fund’s Adaptation impact indicator; 2. For b oth mitigation and adaptation, 3. In 2020 – from: Climate Policy Initiative - Glob al Landscape of
Climate Finance 2021 report; 4. African Development Fund; S ources: 'Delivering on the $100 billion climate finance commitment and transforming climate finance' – UN; COP26 announcements, National Adaptation Plan Global Network, p ress releases, UNFCCC; Global
Landscape of Climate Finance 2021 – CPI; BCG analyses

13

Deforestation | 141 governments pledge to reverse deforestation –use momentum to build coalitions, transparency, support suppliers
6%of 2019 global emissions– due to loss of natural sink

7% lower forest cov er quality (vs2000)
Rainforests (including Amazon) at
risk of becoming net carbon
source75% of deforestation due toagriculture1

COP26: Strong commitment by states and private sector, but
critical to focus on gross deforestation, action and control next
Public support

Priv ate action

141 countries (91% of forests2) committed toreversing forest loss by 2030 ($19 bn) – but noagreement on gross (preferred) vs net deforestation3

33 FIs (AuM ~9tn)
commit to deforestationfree portfolios by 2025

FACT4: 28 states (75% of trade) to stop forest loss
from ten main commodities by 2030

AFR100: commitment
to restore 127m ha landby 2030

AIM4C 5 ($4 bn) to accelerate agri-innovation

1 Own supply chain

2 Innovate

3 Engage governments

4 Invest

Ensure full transparency
between suppliers andcustomers

Develop plant-based andcultivated meat products

Strengthen regulations withgovernments (e.g. mandatory
due diligence obligations)

Invest in lighthouse projects(including REDD+8 such as
LEAF9 )Engage in collective action
through coalitions, build
system response, to mitigate‘leakage’ issues 7

Invest in restoration projects

Conduct rigorous due
diligence and implement
certifications (RSPO6)

Identify alternatives topalm oil
Expand consumerawareness and marketing

Ensure both carbon
integrity and co-benefits(biodiversity and community)

Forests have potential toreduce carbon globally bymore than 1/3 – we need toapproach this issue with same
seriousness as decarbonization.
Joe Bi den, US Pre sident

Read more on:
Deforestationfree supply
chains, in WWFBCG's report 2021

It is very important to not only
be carbon neutral, but also to
be nature positiv e. We must
act now.
Ivan Duque, President of Colombia

1. Inab ility to improve operations in very segmented supply ch ains with small farmers such as palm oil, beef, s oy and timber companies; 2. Incl. major forest countries: Brazil, Indonesia, Russia, China, Congo, US, UK; 3. Importance of gross deforestationcommitme nt as net deforestation targets equate the value of protecting native forests with th at of planting new ones; 4. FACT = Forest, Agricu lture and Commodity; 5. Agricu ltural Innovation Mission for Climate - joint US-UAE initiative, uniting
p articip ants to accelerate investment and other support for agriculture and food systems innovation; 6. Roundtable of sustainable p alm oil 7. Others continuing to engage in these practices; 8. REDD = Reducing emissions from deforestation and forestd e gradation, 9. LEAF = Lowering emissions by accelerating forest finance . S ources: FAO, CAIT; IEA; World Energy Outlook; GHG Protocol; Glob al Forest Watch; WWF; Forest500, Supply Ch ange, COP26 discussions and announcements; BCG analyses

14

Copyright © 2021 by Boston Consulting Group. All rights reserved. BCG Executive Perspectives updated 15 November 2021 Version 2.0

Business implications

Protecting forests criticalto maintain natural sink2

Methane | Strong pledge from 105 governments can facilitate'quick wins' on abatement - where tech solution already exists
10+years of atmospheric
lifetime (vs CO2: 100+ years)

COP26: 105 governments (50%+ of methane emissions)commit to collectively reduce emissions by 30%+ by 2030 2

28x more powerful than CO2; secondmost abundant human–caused GHG1

Fulfilling the pledge could deliver approx. 1.5Gt GHG1 reduction by 2050

Readily available solutions could reduce
emissions by 45% by 2030

EU: establishing enforcement framework to measure and report2

Most measures can be implemented at
low cost, or even confer savings

1 Energy
Identify and deploy available techfor elimination of venting emissions
and reduction of fugitives
Deploy tech to capture andmonetize "waste” methane

Risk exists not as individually binding pledge – collective only
US: continued efforts to introduce methane fee in spending bill
Canada: 75% oil and gas methane reduction by 20303… but some of the largest methane emitters China (15% of emissions),
Russia (10% ), India (8% ) did not sign the pledge – yet China and US joint
declaration highlighted methane reduction in 2020s4

2 FoodImprove efficiency of agri-practices

3 WasteExplore product portfolio shifts

Optimize upstream processes toreduce/ avoid waste

Given no existing solution, engage crossindustry on enteric fermentation

Deploy tech to capture landfill gas
and wastewater to generate energy

The pledge makes cutting
methane emissions acollectiv e undertaking thatmust be supported by soundscientific basis and a capacity
to monitor emissions,because only what ismeasured gets done.
Ursula von de r Le ye n, Pre sident of the Europe an
Commi ssion

The world now stands
together in stronger
solidarity towards the goal of
cutting methane emissions by
30% by 2030. (…) We now
need to action.
Moon Jae -i n, Pre sident of South Kore a

Across sectors: align with independent monitoring and verification bodies alongside investing in monitoring of own operations
1. Gre e nhouse gases; 2. US also increasingly s tringent regulation; 3. Vs 2012 levels; 4. In the U.S.-Ch ina Joint Glasgow Declaration on Enhancing Climate Action in the 2020s, China highlighted it intends to develop a comprehensive and ambitious
National Action Plan on methane, aiming to achieve a significant effect on methane emissions control and reductions in the 2020s, will cooperate with the US to enhance measurement and jointly research methane emission reduction solutions.
5. Es p ecially away from beef; S ource: Methane tracker 2020; WRI: How methane emissions contribute to climate ch ange, IPCC 2021; UNEP Global Methane Assessment 2021; Bloomberg; 'BCG

15

Copyright © 2021 by Boston Consulting Group. All rights reserved. BCG Executive Perspectives updated 15 November 2021 Version 2.0

Business implications

Methane reduction
can present a quick win

3

Coal | Coal phase-out pledge not signed by major coal emitters, but
recognition and commitment to halt coal funding by 2022 are positive signs
Halt of international fossil fuel financing and cross-country
collaboration projects launched…

… but countries emitting 85%+ coal GHG
did not sign coal phase-out pledge

34 gov ernments (including US, UK, Canada, Italy) to end international publicfinancing (around $24 bn) for fossil fuels by 2022 (following G20 and OECD pledges)

Only 5 out of top 20 power generating countries
committed to phase-out by 2040s (Korea, Indonesia,
Vietnam, Poland, Ukraine)"Accelerate efforts toward phasing down of unabated coal power” and "call for"ending of inefficient fossil fuel subsidies included for the first time in final COP decision yet statement 'watered down’ in final hours ('phase down' vs 'phase out')

Copyright © 2021 by Boston Consulting Group. All rights reserved. BCG Executive Perspectives updated 15 November 2021 Version 2.0

Positive signs butlarge players missing

4

Largest coal users (China3, India, US, Japan, South
Africa, Australia) did not sign pledge

UK-India: Green Grids initiativ e1 to trade renewable energy across borders

Business implications

Just Energy Transition Partnership: $8.5 bn for South Africa coal phase-out2

Investors/Owners

1
Identify commercially
viable solutions (such as
repurposing) to support
early decommissioning

2

Coal owner/operators

Explore technologies andseek regulatory support:
conversion to biomass,
deploy CCS4, ammonia cofiring

Industrials

3
Strengthen focus on
reskilling andredeployment programsfor displaced workers

Power purchasers

45Invest in process design
and tech transition
away from coal-reliant
operations

Adapt decarbonizationplans to regulatory regimes
Push boundaries in lesssupportive regimes

1. UK -Ind ia led Green Grids Initiative – One Sun One World One Grid, endorsed by over 80 countries, to mobilise p olitical will, finance and technical assistance needed to interconnect continents, countries and communities to the very best renewable sources of power
glob ally to ensure no one is left without access to clean energy. 2. France, Germany, UK, US and EU supporting South Africa coal phaseout Just transition; 3. However, China highlighted it will "p hase down coal consumption during the 15th Five Year Plan and make best
e fforts to accelerate this work" in the U.S.-Ch ina Joint Glasgow Declaration on Enhancing Climate Action in the 2020s. 4. Carbon capture and storage. Sources: COP26 announcements, World Energy Outlook; GHG Protocol; Glob al Carbon atlas; Price of Oil, BCG analyses

16

Coal | Climate Pathways study by BCG and NBI played a role in shaping
South Africa's revised NDCs and discussions about $8.5 billion deal
"Decarbonising South Africa’s power system" is a study developed by BCG,
National Business Initiative (NBI), Business Unity South Africa (BUSA), andbusinesses showcasing the pathways to decarbonisation by 2050, building
resilience to the impacts of climate change and ensuring just transition

Securing $8.5 bn forSouth Africa required
an ambitious NDC

Six-step approach taken(power sector)

South Africa improved its
NDC (and target range of2030 emissions) from398-614Mt to 350-420Mt
Co2e before COP26

1 Assess the power sector

3

Identify optimal 2050 powersystem archetypeThe study by BCG and NBI
was one of three key factbases used in informing the
NDC decision

4

Assess last-mile
decarbonization options

5

Define potential net-zero
pathways

starting point

2 Identify the supply gap

Readsummaryof findings
here:

Two phases covered all major sectors
High-level blueprint

Detailed pathways

Priority sectors 1• Power/electricity• Chemicals• Mining

All main sectors
Green finance
Adaptation impact

The results demonstratethat ev en a country withan economy that is
structurally embedded in
an energy intensive
production system can shift.
- BCG, NBI and BUSA study

Strong stakeholder engagement••

100+ industry and policy experts
30+ South Africa's CEOs as champions

key tradeoffs and6 Identify
enablers3
1. 55% of greenhouse emissions; 2. Previous ones + Transport, Metals, Refining, Materials Manufacturing, Agricu lture, Forestry and Other Land Use; 3. Techno-economic (coste mis sions, new-build CAPEX, abatement cost) and socio economic (jobs, GDP, etc.); 4. Renewable energy ; S ource: BCG“This deal (South Africa's
Just Transition $8.5 billiondeal) is the model for how
the EU will support
countries to phase outcoal.”- Frans Timmermans, EU Commission

17

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4

A lot of progress is made pre-COP26 – with EV2 adoption tipping point
in reach (~40m EV sales1,9 by 2030)
EV1 sales expected to ov ertake ICE4 sales by 2030
OEMs with ICE 4 phase-out commitments
Many players investing 30%

represent~27% of global market5- 60% R&D and capex in EV (VW, GM, Ford, Daimler)

Total cost of ownership parity expected by end of 2022 driven by innovation6
Countries with phase-out targets account for ~20% of passenger vehicle market
Yet holistic transition needed (regulation, infrastructure, etc.): e.g.: 7M charging
points now, +100M needed by 20307; risk of battery materials shortage8

At COP26, some large OEMs signed ZEV3 pledge, butother OEMs and major governments missing
Many major OEMs signed the pledge (Ford, GM, MercedesBenz, Jaguar, Volvo, etc.) - others not likely as they see e-fuelopportunity as a viable alternative~30 gov ernments (including UK, Canada) committed to100% ZEV3 sales by 2040 (2035 for leading markets)
But largest auto markets missing (China, US, Japan,
Germany), likely due to focus on ZEV and not wider alternatives

2 Components/battery

Business implications

1 OEMs2
Challenge ev erything: reimagine how to design,build, sell, and use vehicles to significantly lower
purchase price and operating costs
Consider backward integrating to secure supply(such as battery production)
Invest in R&D (batteries' cell chemistry, packassembly) to lower costs

Cooperate with public sector on
charging infrastructure for EVs

Inv est in R&D to develop novel chemistries
and cell components to maximize energy safely

Develop solutions for battery
usage/recycling at vehicle's end-of-life

Focus on building scale and flexibility via
partnerships

Educate the end consumer (ontechnology, cost of ownership, etc.)

Consider software-related services and otherbusiness model innovation

1. Ele ctric Ve h icles - Includes Battery electric vehicle, full e lectrical car, h ybrid EV, plug-hybrid EV and fuel cell EV; 2. OEM=Original equipment manufacturer, 3. ZEV = Zero emission vehicle; 4. ICE = internal combustion engine, 5.Including Audi, Fiat, Volvo – by 2030, GM- b y 2035,
Me rcedes-Benz & Honda – 2040. Other automakers like Ford, Hyundai and Volks wagen have announced regional ICE phase-outs for Europe specifically. 6 . Given falling battery prices (90% since 2010) and lower use cost/km offsetting higher purchase cost; 7. IHS; Transport
Environment; International Council on Clean Transportation; Expert interviews; 8. Cairn Energy Research Advisors: Supply of key metals for battery production is ~30% of 2030 demand; Includes lithium, graphite based on their 2018 supply vs 2030 projected demand in EV space; 9.
Bas ed on OEMs plans and commitments – BloombergNEF; S ources: COP26 discussions and announcements; BCG analyses and experience; CAIT; IEA; BloombergNEF,World Energy Outlook; GHG Protocol

1818

Copyright © 2021 by Boston Consulting Group. All rights reserved. BCG Executive Perspectives updated 15 November 2021 Version 2.0

Industry mov ing forward
outside of COP26

5Auto | Industry commitments in 2021 have accelerated shift to EVs1, withmany large OEMs2 signing ZEV3 pledge - despite major governments missing

6

Finance | ~450 financial institutions with $130 trillion AUM
committed to NZ; major progress on standardized ESG reporting
Financial institutions holding 40% of global financial
assets (~$130tn) committed to net zero (vs $5tn in 2019)

Initial steps toward
standard ESG disclosure

Commitment to net zero not the same as inv esting in climate
initiativ es - major funding gap remains

IFRS's new International
Sustainability Standards Board willdevelop minimum disclosure standards
to meet investors’ information needs2

Ten Multilateral Dev elopment Banks3 pledge to join in to mobilizefinance –funds critical to de-risk private sector investment

No full sector alignment: risk of grey assets falling into the wrong
hands

2 Across industries

Prepare portfolio companies for broader climate and ESG disclosures

Expect better cost of capital for firmsthat are on a path to decarbonization

Factor price of carbon into large capital project planning
Support clients through new lending avenues, like transition finance(oil decarbonization), low-carbon technology (EV4 development financing)
Actively seek 'investable projects', collaborate with wider industry partners
to reduce information gap and transaction costs on smaller-scale projects

COP26: Investing for clean growth
Wendy Woods (BCG) , D olika Banda (ARC),
D avid Auerbach (Sanergy), Bill Winters (SC)UK will require companies to report
net-zero transition plans from 2023

1 Financial institutions (e.g., banks, asset managers)
Catalyze decarbonization of operations by engaging with management

Vinay Shandal, Managing Partner, COP26 D elegate

COP26: Which approach has mostimpact: Divesting or Engaging?
Vinay Shandal (BCG) , Chris James (Engine No. 1)

Seek blended finance fromdevelopment banks to de-risk
Pool projects to de-risk and tackle
smaller scale financing issues

1. CPI, Glob al Landscape of Climate Finance 2021. 2. Initially requirements will ap ply to companies headquartered in Frankfurt, Montreal, London and S an Francisco; 3. African Development Bank, As ian Development Bank, As ian
Infra- s tructure Investment Bank, Eu rope Development Bank, EBRD, European Investment Bank, Inter-American Development Bank Group, Islamic Development Bank, New Development Bank and World Bank; 4. Ele ctric Vehicle;
S ou rce: COP26 discussions and announcements; BCG analyses

19

Copyright © 2021 by Boston Consulting Group. All rights reserved. BCG Executive Perspectives updated 15 November 2021 Version 2.0

Business implications

Big commitments fromthe financial community

COP26 : Next steps for Financial sector

Corporates | Corporates mobilize on climate action with 5,200+
joining Race to Zero ahead of COP26

Business implications

Race-to-Zero campaign

Significant momentum in lead-up to COP26 –commitment to set 1.5oC-aligned science-based targets

Strong corporate involvement across sectors,
especially customer-facing sectors

4,482

5,230

Robust criteria and external validation aims to

3,067
786

995

Dec-19Jun-20ensures credibility and delivers practical change
4 P's framework2: aims to ensure consistency

1,101

PledgeNov -20

Jun-21

Sep-21

Nov -21

Plan
ProceedExpert peer review group

PublishA lot of leaders are hesitant to act
without knowing all facts, but inthis case, the world needs us totake a leap of faith.
Je sper Brodi n, CEO IKEA

At COP26

1

2

3

4

5

Build a granularemissions baseline

Integrate
sustainability KPIs
and dev elop clear
emissions reporting
mechanism

Embed climate
targets across thebusiness and link to
incentives

Modify roles,
responsibilities,
and team structure
to ensure climate
plan permeates
whole organization

Dev elop new
climate champion
roles within highimpact teams (suchas supply chain);reflect in existing roles

Develop (AI-powered)simulation tools to
identify emissions
reduction levers

Speakers: Rich Lesser (BCG), Jesper Brodin (IKEA),
Wendy Clark (Dentsu), Antonia Gawel (WEF)

Sectors hav e reached BreakthroughAmbition (20% of major companies byrevenue within sector committing to NZ1)

18

# of corporates that are members of Race to Zero

COP26-WEF: Business Ambition
for 1.5C - A Call to Action

The largest risk is to nottransform. The customer demand
will change so much faster thanindustrial processes. To be early
will be challenging, but to belate will be devastating.
Anna Borg, CEO Vatte nfall

1. Ne t Ze ro; 2. Pledge: Set an interim target to achieve in the next decade, wh ich reflects maximum effort toward or beyond a fair share of the 50% global reduction in CO2 by 2030 identified in the IPCC Special Report on Global Warming of 1.5˚C. The interim target must be set
with in 12 months from the point of joining the Race to Zero, if not shared already at the time of the pledge. Plan: Within 12 months of joining, explain what actions will b e taken toward achieving both interim and longer-term pledges, especially in the short- to medium-term;
Proceed: Take immediate action toward achieving (net) zero, consistent with delivering interim targets specified; Publish: Commit to report publicly both progress against interim and long-term targets, as well as the actions being taken, at least annually. To the extent possible,
re p ort via platforms th at feed into the UNFCCC Global Climate Action Portal to ensure consistency; Source: UNFCCC Race to Zero; COP26 discussions and announcements; BCG analyses and experience20

Copyright © 2021 by Boston Consulting Group. All rights reserved. BCG Executive Perspectives updated 15 November 2021 Version 2.0

7

"Climate Paths 2.0" co-developed by BCG, with the Federation of German Industries (BDI) and around80 companies and associations. Represents a program proposal of ~20 instruments to enablesectors to achieve climate targets in 2030 and set a course toward GHG1 neutrality in 2045 2

188 Mt CO2e gap (30% of projected 2030
emissions with existing instruments)

Climate Pathways 2.0 proposal offers multidimensional view onlevers, financing, and support needed to bridge gap

Read summaryof findings'Germany: Climate
Paths 2.0' here:

COP26 : BCG-WWF Report Net Zero
Pathways for Malaysia'
Overview of Report recommendations

GHG1 emissions in Germany 1990-2030 (Mt CO 2e)
1,500

1,000

ENERGY626 Mtwith existing
instruments

2019: 810 Mt

438 Mt65% reduction target

500
01990 20152020

Target path2025

18 8 Mt
G ap totarget2030

Current policy pathOv erarchingmeasures

INDUSTRY

TRANSPORTBUILDINGS

make fossil fuels less attractive, rapid infrastructure development

mandatory
renovation
schedules

Industryspecific levers

renewables
attractivenessGov ernment
supportLevers needed (and fiscal burden estimation) to:• Enable the transformation and promote CO2 measures• Limit additional financial burden for private households• Maintain industrial competitiveness for the most heavily affected sectors

carboncontracts

purchaseincentives EVs

1.GHG=Gre e nh ou se gas; 2. Wh ile maintaining growth and employme nt, p rotecting the ind ustrie s economic s tre ngth , and fairly b alancing th e share of cos ts— with ou t d is proportionately b urdening the s tate bu dget.

COP26 : "Delivering to NZ: Movingfrom Commitments to Action"

Speakers: Emma Walmsley (GSK), Noel Quinn (HSBC),
J. Goldman (Breakthrough Energy), Michel Fredeau (BCG)

21

Copyright © 2021 by Boston Consulting Group. All rights reserved. BCG Executive Perspectives updated 15 November 2021 Version 2.0

Collaboration | Strong public-private coordination in a BCG x BDI-developed
proposal on reaching Germany's 2045 GHG neutrality8Collaboration | Four main overarching global initiatives highlighted toaccelerate technological developments across highest emission sectors
Power% of total GHG
emissions, 20191

Initiative

Goal and focus

Glasgow
Breakthroughs

Framework for international public-private coordination,
collaboration, and focus to accelerate innov ation(focus: power, road transport, steel, hydrogen, agriculture)
Private sector platform to pool collective buying tosend a demand signal for emerging tech indecarbonization of high-emitting sectors2

First Movers
Coalition

Green Public
Procurement

Public-private partnership to boost inv estment incritical technologies for net-zero economy, (techscale-up in green hydrogen, SAF, etc.3)
Governmental pledge to leverage public procurement
and large construction projects to stimulate demand
for low-carbon materials such as steel and concrete

Sector-specificinitiatives

Many initiativ es launched to support across COP26
outcomes (non-exhaustive list)

BreakthroughEnergy Catalyst

Industrials

Transport

Agriculture(incl Land use,
Forestry, etc.)(incl. Buildings,
Waste, Fugitive)

17%

18%

(Coal, Gas, Oil)

(Steel, Cement,
Chemicals, etc)

(Road, Shipping,Rail, Air)

30%

18%

17%

• GEA4• Concrete Zero • EV Transition• Green Grids
buyers clubCouncil plan
Initiative – One • Responsible• Aviation Net
Sun One World
Steel
Zero coalition
One Grid

1. S p lit b ased on 2019 emissions (total ~53Gt CO2); 2. E.g. heavy industry, long-distance transportation, CO2 removals; 3. Direct air capture and long duration energy storage; 4. Glob al Energy Alliance for People and Planet;
S ou rce: CAIT; IEA; World Energy Outlook; GHG Protocol; COP26 announcements; BCG analyses

Other• FACT roadmap• Regen10• AIM4C• Africa Green Finance22

Copyright © 2021 by Boston Consulting Group. All rights reserved. BCG Executive Perspectives updated 15 November 2021 Version 2.0

8Glasgow Breakthroughs offers framework for global public-private
commitments to deliver affordable clean technology by 2030

Breakthrough Agenda aims to drive faster innovation, scale, and deployment of clean solutions

42

Governments (70% of global GDP) signed up to coordinate introduction of clean tech to rapidly reduce cost

Goal: Make clean technologies the most affordable and accessible option in emitting sectors globally before 2030
Progress assessed globally by ministers via an annual IEA report in collaboration with IRENA & UN HLCs1 – basedon: capacity increase, R&D, deployment investment, efficiency improvement, cost and affordability, infrastructure
availability

Glasgow Breakthroughs are the first set of global 20 30 goals - anchored in hard-to -abate sectors2
Power

Transport

Steel

Hydrogen

Agriculture

To make clean power them o st affo rdable andreliable option for all
countries

To make zero -em issionv ehicles the new normal
in all regions

To make near-zero
em ission steel thepreferred choice in global
markets

To make affo rdable
renewable and lo w
carbo n hydro gen globally
available

To make clim ate-sm art,
sustainable agriculture
the most attractive andwidely adopted option forfarmers everywhere

We urgently need targeted
breakthrough innov ations
in agriculture to support
farmers’ families andcontribute to sustainable
resilient food systems.
Bill Gates, Bill & Melinda Gates
Foundati on

This is what the future of COP
is all about - catalysing an
innov ativ e ambition loop
between political leadershipand private sector to drive a
resilient zero-carbon future.
Nigel Topping, HLC COP26

Private sector is struggling tofind places to invest – we needprojects of a certain scalethat are missing in places thatneed them most.
We ndy Woods, BCG at COP26:
Inve sti ng for Cle an & Inclusi ve Growth

1. IEA: Inte rnational Energy Agency, IRENA: International Renewable Energy Agency, UN High Level Climate Champions
2. Ad d itional sectors expected to be added at each COP; Source: Glasgow Breakthrough announcement; COP26 discussions and announcements; BCG analyses

23

Copyright © 2021 by Boston Consulting Group. All rights reserved. BCG Executive Perspectives updated 15 November 2021 Version 2.0

8.1

First Movers Coalition (FMC) launched to build and pool early demand forzero-emission goods and services – supporting hard-to-abate industries

Hard-to -abate sectors face early
FMC will facilitate offtake agreements, assemble sectoral 'buyers'
deployment headwinds for NZ1 tech clubs, and pool purchase commitments6 to bridge early-demand gap

COP26: First Movers
Coalition Launch
Speakers: John Kerry, Rich Lesser, Børge
Brende, Sumant Sinha, Kara Hurst, Anna
Borg, Brian Moynihan, Melissa Schoeb

Resources

First Movers
Coalition

Sectors such as industrials, transport faceeconomic barriers on investment:•

High CAPEX cost of new tech2•

Uncertain demand•Not capitalized financial incentive•

Inherent high emissions in operations

Largely a gap
prior to COP265
Capitalrequirements
R&D

Around 80% of emissions can be abated byexisting tech – with half of them needing
deployment and scaling3
Critical to coordinate along the value
chain, create downstream demand4
and willingness to redesign processes

Typically
available
resources

Demonstration

Commercialization

Tech maturity

1 Hard-to-abate goods suppliers 2 Buyers
Gain better understanding of market
needs across your downstream value
chain and willingness to pay

Gain a competitive edge through yoursupply chain by securing early access to
supply of truly net-zero techPartner across your value chain to jointly
remove roadblocks and achieve zeroemission tech at scale

Leverage “FMC-Certified” to raiseawareness and gain premium
Shape FMC design as early members

1. Net zero, 2. CCUS to decarbonize cement cost +80%, ~$1 trillion CAPEX by 2040; Green hydrogen to decarbonize steel: cost +70% & x100-200 more supply needed; 3. Final 20% requires innovation 4. Upstream producers face high abatement
cos t b ut have low EBITDA per tonne CO2; Situation reverse for upstream consumer facing companies; 5. S ome players s tarted operating in the space – e.g. The Climate Group’s S teelZero buyers’ club; 6. The commitments will b e technologyne utral, but they will be stringent enough to target solu tions with the potential to completely decarbonize these sectors rather than only partially reducing emissions through incremental approaches such as efficiency gains. S ource: COP26
announcements; WEF; BCG analysis; IEA World Energy Investment Outlook 2018; HBR 2021, The Green Economy has a resource S carcity Problem

Copyright © 2021 by Boston Consulting Group. All rights reserved. BCG Executive Perspectives updated 15 November 2021 Version 2.0

8.2

We tackle challenges at both
ends: Investing in R&D to
innovating - sending
demand signal loud andclear.
Joe Bi den, US Pre sident

As a coalition of purchasers,
we will be ready to sign up
and purchase technology at apremium, and to help you
hav e the confidence tomake bold inv estments.
Ri ch Le sser, BCG Global Chai r

24

8.3 Breakthrough Energy Catalyst has attracted public sector and corporate

involvement and investment for scaling up of critical Net Zero technologies

Catalyst aims to find, finance, scale andbuy new zero-carbon economy solutions

1

Bring together public and private funds
to address early deployment gap

2

Accelerate commercial v iability andscalability for decarbonization tech3

Help reduce the costs to compete with& replace GHG-emitting counterparts

Aim to deploy $3bn+ in concessional capitalin the next 4 years to catalyse up to $30bn ofinvestments in bringing down clean tech costs
and creating markets for green products in:Long durationenergy storage1

Direct air capture3

Sustainableaviation fuel2

Green hydrogen4

Strong traction after launching in 2021 – large public sector
commitments and strong corporate anchor partners across industries

US DoE5:$1.5bn

EU:

$1bn

UK:

$0.55bn

Started process of identifying first set of projects for investment

Priv ate actors can participate across the v alue chain:• Identify opportunities & submit projects• Make inv estments in decarbonisation technologies• Commitments to purchase the outputs of these projects• Offer perspectives on continued private sector engagement• Prov ide insights on investment and offtake strategies• Help to encourage more companies to join Catalyst

This new partnership willbe critical to unlocking thepotential to find, fund, andscale innovative technology
solutions.
Chri stoph Schweizer, BCG CEO

To scale climate
innov ations we need toreduce the cost difference
between the current and thegreen products - the green
premium.
Bi ll Gate s, BE Catalyst Founde r

1. Long Duration Energy Storage – the storage of energy in a system th at can discharge electricity over time for a duration greater than 8 hours, with a focus on s torage of renewable energy resources 2. S ustainable Aviation Fuel ( the p roductionof low carb on jet fuel (e.g., u sing sustainable feedstocks, power-to-liq uids); 3. Direct Air Capture ( the process of capturing CO2 directly from the ambient air with the end result of reducing overall CO2; 4. Green Hydrogen – the creation ofh yd rogen using methods that limit carbon emissions (e.g., e lectrolysis using renewable energy); 5. Department of Energy0

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COP26 : Bill Gates, Rich Lesser& Judith Wallenstein interview

Green Public Procurement initiative will leverage public procurement tostimulate demand for low carbon materials, such as steel and concrete

Public procurement is key
emission reduction lever

$11tn

$11tn

Global public
procurement spend(13% of global GDP)

$11tn

~15%

Of global GHG
emissions(7.5 GtCO2e)

$11tn
~35%
~35%

Public procurement
share in hard-toabate sectors

IDDI1 launched Green Public Procurement (GPP) government pledge to senda demand signal for low carbon initiatives via public procurement

COP26 : Kick-start Construction
Decarbonisation panel
Speakers: Stefan Sicars (UNIDO), Magali
Anderson (Holcim), Tor Burrows (Grosvenor),
Steve Adler (Mayor, Austin), P amela Liu (BCG)

3-level government pledges (initial members: UK, Germany, India, Canada, UAE)
1Disclosure of embodied
carbon emissions2 in major
public construction
projects by 2025

2

3
Pledge to achiev e net
zero embodied carbon
emissions2 in all publicconstruction by 2050

Pledge to set baseline
and 1.5 o C aligned
reduction targets for2030

Businesses can become first-movers to define standards & benefit
Monitor federal and local gov ernment activity around priority GPP categories and targets,abatement paths and laws
Work with governments to agree a common set of standards for accurate and compatible
data, building on what exists
Become a first mov er to secure and benefit from early contracts
Consider emission targets within tenders to ensure competitiveness

1. Lau nched by IDDI: Industrial Deep Decarbonization Initiative; 2. Embodied carbon means all the CO2 emitted in producing materials . It's estimated from the energy used to extract and transport raw materials as well as emissions frommanu facturing processes.

Need to tackle threebottlenecks: standards,
disclosure framework forcarbon and green public
procurements.
Ste fan Si cars, UNIDO

We are ready as a company,
we are ready as a sector
and we want to go this way.
Magali Ande rson, Holci m26

Copyright © 2021 by Boston Consulting Group. All rights reserved. BCG Executive Perspectives updated 15 November 2021 Version 2.0

8.4

AIM4C

Agricultural Innovation Mission for Climate

IFRS

International financial reporting standards

AUM

Assets under management

IRENA

International Renewable Energy Agency

COP

Conference of the Parties

LEAF

Lowering emissions by accelerating forest finance

ESG

Environment, social and governance

LTSLong Term Strategies

EV

Electric vehicles

NDC

Nationally Determined Contributions

FACT

Forest, agriculture and commodity

NZ

Net zero

GEA

Global Energy Alliance for People and Planet

OEM

Original equipment manufacturer

R&D

Research and development

GFANZ

Glasgow Financial Alliance for Net Zero

REDD

Reducing Emissions from Deforestation and forest Degradation

GHG

Green house gas

RSPORoundtable of sustainable palm oil

GPP

Green Public Procurement

RtZ

Race to Zero

HLC

High level climate

SAF

Sustainable aviation fuel

ICE

Internal combustion engine

UNFCC

UN's Framework Convention on Climate Change

IEA

International Energy Agency

WBCSD

World Business Council for Sustainable Development

ZEV

Zero emission vehicle

Copyright © 2021 by Boston Consulting Group. All rights reserved. BCG Executive Perspectives updated 15 November 2021 Version 2.0

Glossary | Inside COP26: The unexpected wins and remaining challenges

27