I was there in Dubai, and heard many people disparage the outcomes as a dismal disappointment, while others claimed them as an historic achievement.

The truth, as I see it, lies somewhere in between. The international agreement that emerged from COP28, and its ramifications for business and society, are far too nuanced to be summed up in a binary declaration of either triumph or tragedy.

Personally, I take a cautiously positive view – primarily due to the appearance of two little f-words in the text of the agreement: 'fossil fuels'.

Progress in global climate negotiations

Climate negotiations are a notoriously fraught exercise in international diplomacy. Almost 200 national governments participate each year in COPs. Each government has its own unique set of economic, political, social and environmental ambitions, needs and challenges. Some countries have totally opposing positions. The use of fossil fuels, and the resulting man-made climate change, threaten the very existence of some nations. Yet for other nations, fossil fuels are the bedrock of their economies and the source of their growth and prosperity. Finding a form of words for international agreements that all nations can all sign up to is therefore a Herculean task.

No wonder year-to-year progress in climate negotiations is slow and incremental. The needle moves gradually. Within this complex geopolitical context, dramatic leaps and twists simply don’t happen. Expecting these will inevitably result in disappointment.

Of course, we have long known it is impossible to slow or halt climate change while mankind continues to burn oil, gas and coal as our primary energy sources. But openly acknowledging that fact in international agreements has thus far been taboo. Major oil-producing nations have blocked any earlier attempts to do so. Previous agreements only referred to greenhouse gas (GHG) emissions, and not to the root cause of them.

Transitioning away from fossil fuels

COP28 has produced – for the first time in international climate negotiations – a global climate agreement that explicitly refers to ending our use of fossil fuels. We should not underestimate the significance of that.

So let’s take a moment to recognize and appreciate what has been accomplished.

Headway is being made – albeit at a pace that is frustratingly sluggish for many. We now have a global agreement to 'transition away' from fossil fuels. Yes, the wording is vague and ambiguous and falls short of the 'phase out' that many had hoped for. But, at last, it is there and I prefer to see it as a glass that is half full rather than half empty.

The world’s governments have reached consensus that our global energy system must change and fossil fuels must become a thing of the past. They have, in effect, set up a giant economic signpost pointing away from the fossil fuel industries. The direction of travel is set.

It is now very clearly a matter of when and how, not if. How quickly we shift away from fossil fuels and exactly what route we take in terms of alternative technologies is yet to be worked out. Further international commitments born from COP28 – such as those to triple renewable energy capacity and double energy efficiency by 2030 – will help to drive momentum. Some countries and industries will inevitably move more rapidly and more decisively than others.

The outcome of COP28

The most significant outcome of COP28 is, finally, an acknowledgement on the global political stage that fossil fuels are yesterday’s energy source and not tomorrow’s. That is a direction we in the business community can – and should – work with. Long-term investments in conventional energy sources will be scrutinized and will risk weakening the future resilience of companies.

It’s been a long time coming. 'Fossil fuels' may only be two little f-words, but – to my mind at least – their appearance in the COP28 agreement makes a big difference.