Guest Insight | Path to COP31
Eva Cairns, Senior Advisor, GEFI
As COP31 approaches, Eva Cairns shares her perspective on the priorities for investors and what meaningful progress on climate finance and implementation could look like in Antalya.
Every year, thousands of delegates gather over a 2-week period for intense negotiations on climate change to limit global warming. Last year, COP30 was in Brazil and I attended in my former role as Head of Responsible Investment at Scottish Widows – you can read my reflections on the outcomes here: Good COP, bad COP? Reflections on the global climate conference – Scottish Widows Insights Hub
This year, COP31 runs from 9–20 November in Antalya under split Turkish and Australian leadership.
Details on the programme and thematic days can be found here: Programme Overview | COP31 Türkiye. Particularly important for investors will be the Business and Investment Summit on 12-13 November and Finance Day on Friday the 13th (hopefully not a sign of bad luck!).
I will be attending COP31 as senior advisor to the Global Ethical Finance Initiative (GEFI), leveraging my background in climate change and responsible investing to closely watch what is happening on the ground and why it matters to investors.
What sets COP31 part from previous summits?
Three key features to highlight:
A split presidency.
For the first time, two countries share the job. Türkiye hosts the conference and runs the Action Agenda of voluntary targets and partnerships. Australia, working with Pacific island nations, chairs the formal negotiations and drafts the summit's final "cover" decision. It will be interesting to see whether that collaboration will help enhance the process.
A hard geopolitical backdrop.
Delegates arrive amid war in the Middle East, an energy-price shock and a year of climate extremes. The US federal government is absent, having withdrawn its climate plan, so American participation will come through states, cities and companies. As always, Carbon Brief provides an excellent view on who wants what from COP31.
A strong implementation focus.
Arguably, this is not different from the last few COPs that were also positioned as ‘implementation COPs’. But at this point, 155 countries, covering roughly three-quarters of global emissions, have filed updated national climate plans (NDCs) running to 2035. The focus is firmly on delivery rather than new pledges: how national climate plans become regulation, which projects get financed, and where capital is steered next. This is important for investors as it clearly shapes risks and opportunities for private capital allocators.
Are we on track to deliver on the Paris Agreement?
The simple answer is no. Progress to deliver on the goals of the Paris Agreement and keep warming to below 2°C is bleak: According to the latest UN Environment Programme’s (UNEP) latest Emissions Gap Report, the world could warm by 2.8°C this century if current climate policies continue. Even if countries fully implement their current climate pledges, warming could reach 2.6°C. Something investors need to carefully consider when assessing the exposure of their assets to physical risks in this scenario.
What are the core themes investors should watch?
The presidency’s flagship announcement is a “35 by 35” global electrification goal: lifting electricity’s share of global final energy use from just over 20% today to 35% by 2035. It sits alongside other 2035 Action Agenda targets: halving the growth of global waste, cutting building-sector energy intensity by 25%, and raising circular material use to at least 15%. If Australia folds the electrification goal into the negotiated cover decision it will carry more weight than a voluntary pledge and shape investment incentives in grids and transmission, storage and heat pumps.
The Presidency is embracing the focus on ‘AI for Clean Technology’ to advance the energy transition through its launch of the Antalya Pledge on Artificial Intelligence focusing on how AI is designed, procured, powered, deployed, measured and managed in support of climate and sustainable development objectives. A critical topic for investors looking at opportunities and risks related to AI developers and deployers across their global portfolios and its interconnection with climate change.
The WRI Climate Watch NDC tracker shows that 155 countries have submitted updated national climate plans through their NDCs. The new NDCs only really matter for investors once they become laws, subsidies, standards and supervisory expectations. This “transmission” from international commitments to national rules is the key thing for financial institutions to track. COP31 also launches the second global stocktake (GST2), a review of collective progress that concludes in 2028 and will set the tone for the next round of targets.
A new “Climate Implementation Bridge” aims to turn NDCs into investment-ready project portfolios and clear bottlenecks in project preparation and access to finance. The presidency is also encouraging governments and multilateral development banks (MDBs) to standardise regulatory frameworks to reduce legal uncertainty for cross-border investors. The COP31 Business and Investment Summit on 12–13 November will focus on finance-ready projects and enabling partnerships.
Under the Baku to Belém roadmap, the target to scale finance to developing countries to $1.3 trillion a year by 2035 remains a challenge. A first progress update on that goal is due at COP31. Public money is tight. The EU has ruled out new finance pledges in Antalya and wants to focus on delivering existing ones. Several donors are cutting aid, and some MDBs are being pressured to drop climate objectives. At the same time, developing countries are pushing for a clear programme to mobilise finance. For investors, the implication is more demand for blended finance, guarantees and private capital.
Article 6 on carbon markets provides provides the framework for countries to cooperate voluntarily in achieving their NDCs – they are not a formal negotiating item this year, but still prominent. COP31 President-Designate Murat Kurum has named carbon markets as a COP31 objective and a channel for mobilising more than $50bn a year of extra finance for developing economies.
At COP30, delegates failed to secure an agreement on roadmaps to transition away from fossil fuels and halt deforestation. Discussions continued at talks in Santa Marta earlier this year and Brazil has recently published the roadmaps on transitioning away from fossil fuels and on halting deforestation by 2030. These documents set out a menu of policies that countries could act on straight away. It will be interesting to watch how the recommendations set out in these two documents will make it into negotiations and the final cover text. The agreed language matters for stranded-asset risk.
Following a year of climate extremes and disasters, adaptation is also high on the agenda. Countries must refine the 59 indicators agreed at COP30 for the global goal on adaptation. Developing countries want further detail on last year’s pledge to triple adaptation finance. This is a big topic for insurers who will be gathering at the COP31 Global Sustainable Insurance Summit, co-convened by UNEP and the Insurance Association of Türkiye. Resilient infrastructure, water and climate-risk insurance are some of the key angles for investors. Related to the water theme, 105 countries have called for COP31 to put the ocean at the heart of climate action and Türkiye is seeking an Antalya Ocean Declaration on nature-based solutions and marine ecosystems.
Will COP31 shift capital allocation?
In a nutshell, COP31 can shift where private capital is mobilised if the following happens:
- Writing specific sector targets into the negotiated cover decision.
- Producing credible, investment-ready project pipelines.
- Showing clearer routes for private capital to reach emerging markets, through blended finance, MDB reform and Article 6 carbon markets.
As always, the real test comes after delegates return home and success depends on how countries will turn NDCs into domestic policies. That is the transmission investors should track into 2027.
GEFI: The Partner for Action for Financial Market Stakeholders Engaging with COP
GEFI is an UNFCCC Accredited Observer Organisation with extensive experience in building practically-focused COP programmes. Along with traditional finance, our programmes incorporates broader perspectives and themes such as the just transition, blended finance, nature and biodiversity, Islamic finance and the SDGs.