This article first appeared in Forum, The Edge Malaysia Weekly on November 27, 2023 - December 3, 2023

I am hopeful that the upcoming COP 28 climate summit will give nature the role it deserves in our fight against climate change.

The COP 28 Presidency’s Action Agenda is ambitious and to the point, with a focus on fast-tracking the energy transition by slashing emissions before 2030. Importantly, the agenda will centre on nature, people, lives and livelihoods, thus recognising the intrinsic link between climate change, nature loss and inequality.

And we have no time to lose.

In October 2023, we saw yet again new heat records on air and sea temperatures as well as sea ice recession, prompting scientists to raise the alarm over a million species currently on the brink of extinction. The United Nations Food and Agriculture Organization highlights that around three-quarters of edible crops depend fully or partially on natural animal pollinators, making food production undeniably at risk when insects and mammals are in danger.

Malaysia, one of the world’s most biodiverse countries, is not spared from this. Our biodiversity is declining. We lost the only surviving Sumatran rhinoceros only four years ago in 2019, and the Malayan tiger, the only tiger subspecies inhabiting the Malay Peninsula, is on the verge of extinction, with fewer than 150 left in the wild as at 2022.

In response to this, the Malaysian government has launched an updated National Policy on Biological Diversity (2022-2030), which will guide the country to halt and reverse biodiversity loss. The government has also allocated RM200 million to support the efforts of state governments in increasing the percentage of protected forest areas and conserving endangered wildlife.

Globally, the Intergovernmental Panel on Climate Change has clearly stated that the world must reduce emissions drastically and protect natural carbon sinks, such as forests, wetlands and mangroves. Currently, forests store around 400 gigatons of carbon dioxide and play a critical role in the global climate system.

The United Nations Environmental Programme estimates that US$154 billion (RM721 billion) is spent annually on such nature-based solutions, whereas more than double the amount is required. Today, only 15% of the funds come from the private sector.

Nature-based solutions serve to put an economic value on protecting, managing and restoring healthy ecosystems for us and future generations. Carbon credits can be generated by initiatives such as protecting forests at risk of deforestation or restoring wetlands. Companies can then purchase these credits to compensate for, or offset, their own emissions, and such credits are traded on voluntary carbon markets today.

However, carbon markets and offsets are not without their critics. A key argument is that offsetting could allow companies to continue unsustainable behaviour indefinitely, and there have been examples of carbon credit projects that did not provide the claimed benefits, causing their credits to be deemed worthless.

Despite the critique, there is broad international consensus that offsetting is critical in both achieving net zero carbon emission ambitions and in directing private capital into the protection against the loss of biodiversity. Scientists estimate that nature-based solutions can contribute up to 37% of the necessary carbon mitigation efforts by 2030.

In Malaysia, there is significant potential for innovation in nature-based solutions, with an estimated carbon crediting potential of up to 40 million tonnes of carbon dioxide annually — equivalent to 3% of the world’s total potential. Alongside decarbonisation efforts, nature-based solutions provide Malaysia with the opportunity to meet its climate targets and support other countries through additional carbon sequestration opportunities, which will provide socioeconomic benefits to the people of Malaysia.

However, the science and practice around nature-based solutions is still maturing and needs to be strengthened. This requires certified carbon accounting, proof that such projects deliver the stated carbon reduction, which would not have happened without the sale of the carbon credit, evidence that greenhouse gas emissions are avoided or removed for the long term, typically for 100 years, as well as demonstrating co-benefits that are generated for biodiversity and the local community.

To expedite the development of high-integrity and certified nature-based projects, remote sensing, artificial intelligence and machine learning are increasingly being adopted for measurement, monitoring, reporting and verifying carbon values for a project.

At Petroliam Nasional Bhd, we see nature-based solutions as an important part of delivering our Net Zero Carbon Emissions by 2050 pathway. Alongside substantial emissions reductions, it would enable us to offset our hardest-to-abate emissions, as well as contributing to the country’s future prosperity and well-being.

Earlier this year, we participated in Bursa Malaysia’s inaugural carbon credit auction and we signed a memorandum of understanding with the Malaysia Forest Fund under the Ministry of National Resources, Environment and Climate Change to explore and develop high-quality and nature-based solutions projects.

We have also published our position on nature and biodiversity, which describes what we will and will not do in regards to the natural environment. It is the start of a journey and we are committed to progressing on it.

As COP 28 approaches, it is crucial that international climate negotiations recognise the importance of nature-based solutions and the international collaboration and transfer of funds required to maintain and improve the health of our natural environment.

This year’s summit promises to be the most inclusive so far, with youth, indigenous peoples and the fossil fuel industry, among others, invited to participate, be accountable and make their voices heard.

I am hopeful that the upcoming COP 28 climate summit will give nature the role it deserves in our fight against climate change, as we all depend on it for our future.

Charlotte Wolffe-Bye is chief sustainability officer at Petroliam Nasional Bhd. This column is part of a series coordinated by Climate Governance Malaysia, the national chapter of the World Economic Forum’s Climate Governance Initiative. The CGI is an effort to support boards of directors in discharging their duty of care as long-term stewards of the companies they oversee, specifically to ensure that climate risks and opportunities are adequately addressed.

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