The Impact of COP 29 on Global Climate Action

A recent report from the European Copernicus Climate Change Service revealed that 2024 is on track to be the first year that global temperatures surpass the critical 1.5°C warming threshold set by the Paris Agreement. This reality set the backdrop for COP 29, where world leaders came together to deal with our growing climate emergency. From November  11th to 22nd, representatives from more than 170 countries gathered in Baku, Azerbaijan.  This builds on earlier climate agreements and create new frameworks for climate finance and carbon reduction plans. Though some laudable achievements were noted by observers, many criticisms and setbacks highlighted at this year’s conference. 

Related Insight: Inside COP 29: Early Announcements and Key Negotiations to Watch

Key Agreements and Policies 

Global Financial Commitments and Implementation 

COP 29's biggest achievement centres on a groundbreaking financial pledge. Developed nations committed to providing £238.3 billion annually to support global climate action. This amount shows a major jump from the earlier target of £79.42 billion. The conference created a bold climate financing framework with these major commitments: 

• A total climate financing goal of £238.3 billion annually 

• Multilateral Development Banks plan to give $120 billion yearly climate financing to low and middle-income countries by 2030 

• New UN-backed global carbon market rules that help carbon credit trading 

International reactions to this financial framework remain divided. EU representatives see it as a way to boost private investment. However, representatives from developing nations, especially those from Africa and small island states, worry the funding isn't enough. India's team called the commitment "a paltry sum" and stressed that developed countries need to do more towards climate financing. 

Regional Impact Assessment 

Regional gaps have become a hot topic at climate events with developing nations more likely to be faced with bigger climate challenges than others. Africa alone has significant solar potential owing to its unique climate and geography but gets only 3% of global energy investment. This indicates how unfairly resources are shared across regions. The conference showed how different regions face unique challenges when it comes to climate finance: 

• Small Island Developing States (SIDS) are extremely vulnerable 

• African nations do not get enough climate funding 

• Least Developed Countries (LDCs) need special help 

• Middle-income countries find it hard to work with complex financing systems 

Global Carbon Market Agreement 

COP 29's breakthrough carbon market agreement signals a radical alteration in how the world implements climate policies. The conference wrapped up the Article 6 framework, and experts predict savings of up to £198.5 billion each year as countries put their climate plans into action. The Paris Agreement Trading Mechanism, now in place, sets strong standards for carbon market operations. The policy brings several changes: 

• Enhanced transparency and accountability measures 

• Mandatory environmental and human rights safeguards 

• Strengthened verification processes for emission reductions 

• Implementation of registry systems for carbon credit tracking 

Both countries and companies can now access a centralised UN-supervised carbon market. The framework draws criticism about double-counting risks and community impact safeguards. New provisions tackle these concerns through independent grievance processes and matching adjustments for all authorised carbon credits. 

Achievements at COP 29

• The introduction of detailed carbon market mechanisms stands out as COP29's biggest win. Countries can now use new tools with environmental safeguards and verification processes to reach their climate goals.  

• The Loss and Damage Fund will start financing projects in 2025. The fund has gathered pledges worth more than £579.7 million to help climate-vulnerable nations. 

• China has pledged to take a more prominent role in climate financing. This represents a key achievement that points to better cooperation with Global South countries. Their new approach will boost international teamwork in tackling climate challenges 

• Non-Party stakeholders played a bigger role at the conference. Businesses, climate activists and indigenous campaigners played a prominent role in shaping decisions at this year’s COP. 

Criticisms and Challenges of COP 29 

Despite its achievements, COP 29 was not without significant challenges and criticisms. Azerbaijan’s presidency came under scrutiny early on due to the country's reliance on fossil fuels and concerns over its human rights record, leading some to label the event as "greenwashing" or an attempt to polish the country’s image. Other challenges levelled against the conference included: 

• Criticisms of developed countries withholding climate financing commitment 

• Allegation of corruption amongst COP officials 

• Overrepresentation of corporations in the conference 

Moreover, despite positive discussions around climate finance, there were concerns over the actual delivery of financial commitments, as many developing countries have struggled to access the promised funds. In terms of emissions reductions, there were worries that countries were still not committing to sufficiently ambitious carbon-cutting targets, leaving the world behind in the race to limit global warming. Additionally, disagreements over carbon offset mechanisms and how to ensure accountability in these schemes were persistent issues that prevented full consensus on key actions. 

The Bottom Line

Developing nations and small island states still face unique challenges when they try to put these strategies into action. Their struggles show why the need for targeted support and fair distribution of resources across regions. As the world looks toward COP 30, COP 29 will be remembered for its pivotal role in accelerating climate action, but also for highlighting the gaps that must be addressed to fulfil the promises of the Paris Agreement. To learn more about the agreements and policies from COP 29, how they could shape the business landscape and potentially affect your organisation, book a free consultation with our expert sustainability scientists here.