By the Exponential Roadmap Initiative and the Fossil Fuel Treaty Initiative
The global climate conversation has fundamentally shifted. Following the landmark First Conference on Transitioning Away from Fossil Fuels in Santa Marta earlier this year, the debate is no longer about whether we must phase out fossil fuels, but how quickly and fairly we can execute the transition. A new diplomatic forum with committed nations ready to act has been established; the challenge now lies in real-economy implementation.
As part of London Climate Action Week, the Exponential Roadmap Initiative (ERI) and the Fossil Fuel Treaty Initiative (FFTI) convened a roundtable of leading businesses, investors, and civil society leaders. Held under Chatham House Rules, the discussion moved past high-level rhetoric to confront the structural realities of building an earth-aligned economy. The mandate from the private sector was clear: to scale fossil-free solutions and phase out incumbent dependencies, business requires radical policy certainty, a dismantling of market distortions, and a new era of coordinated corporate advocacy.
As we look toward the Second Conference to be co- hosted by Tuvalu and Ireland in 2027, the private sector must transition from passive supporter to active architect of the post-fossil fuel economy.
The Crocodile Economy: Growth Decoupled from Emissions
The technological debate is largely settled. We possess the solutions necessary to halve global emissions — and despite falling behind the trajectory we should be on, we can and must still achieve this by 2035 at the latest. From the deployment of fossil free materials and transport to the exponential deployment of renewable energy, the transition is increasingly driven not solely by climate necessity, but by innovation, industrial opportunity, and the imperative of supply chain resilience.
The roundtable explored the concept of the “Crocodile Economy“, a framework demonstrating how companies can successfully open the “jaws” of their business models, driving revenue growth upward while driving emissions sharply downward. For many countries and companies, this decoupling is already a reality. The business case for electrification and renewables is robust, often offering a superior total cost of ownership over the long term.
However, as participants noted, while the solutions exist, they are not scaling fast enough to keep us within the safe operating space of a 1.5°C trajectory. The barrier is no longer feasibility; it is the speed of systemic deployment. We are currently witnessing isolated cases of decoupling rather than a system-wide pattern. To achieve scale, we must address the structural realities that keep the global economy tethered to fossil fuels.
Confronting Market Distortions
The most significant insight from the dialogue was the extent to which the transition is constrained by deeply embedded market distortions. Fossil-based models remain structurally advantaged, artificially suppressing the competitiveness of cleaner alternatives even when those alternatives are technologically mature.
Two primary blockers emerged:
- The Subsidy and Pricing Imbalance
The global economy continues to funnel trillions into fossil fuel subsidies, creating an uneven playing field. Participants highlighted that without a robust, stable, and expanding carbon pricing mechanism (e.g. a strengthened Emissions Trading System) low-carbon products, from green steel to circular textiles, cannot compete fairly. The rules of the game are currently skewed to protect incumbents. The economic system must be shifted so that fossil-free solutions become the default, rather than a niche requiring a “green premium.”
- Policy Instability and the Absence of Clear Market Signals
Even where policy frameworks exist, their instability undermines investment. Businesses making long-term capital commitments, e.g. in green steel plants, renewable energy infrastructure, or circular supply chains, need confidence that the rules will not change before the investment has paid back. Participants noted that frequent policy reversals, delayed regulatory decisions, and ambiguous standards create a chilling effect on private capital: companies are willing to move, but not into a void. Clear, durable, and forward-looking market signals are what makes investment decisions bankable. Thereto, unlocking private capital requires new models of risk-sharing, where development banks and public finance help companies bridge the gap between high upfront capital expenditures and long-term operational savings.
The Call for Business Leadership
The fossil fuel industry has spent decades embedding its narrative and structural advantages into the global economy. In contrast, many progressive businesses remain focused primarily on implementation. While implementing the transition is crucial, businesses also have an opportunity to become advocates for the policies and market conditions that will enable change at scale and in a fair manner.
The roundtable underscored that governments are often hesitant to enact bold policies because they perceive a lack of business support. In reality, that support often exists but is not sufficiently visible. Policymakers frequently hear from those who oppose the transition, while companies successfully navigating it tend to be less vocal. This is perhaps unsurprising, given the significant resources and communications budgets dedicated to preserving the status quo. Nevertheless, making business support for the transition more visible will be critical to building confidence among policymakers and accelerating action.
To accelerate the phase-out, business leadership must evolve in three crucial ways:
- Provide Case Studies Demonstrating Success and Ongoing Investment: Governments need concrete evidence that businesses are ready to invest in a fossil-free future. By transparently sharing case studies of successful implementation—demonstrating that electrifying fleets or transitioning supply chains is difficult but entirely possible—companies provide policymakers with the confidence to mandate change.
- Align Indirect Lobbying: Companies must scrutinise their trade associations. It is insufficient to hold progressive climate goals internally while funding industry groups that actively obstruct climate legislation. Direct corporate action must be aligned with indirect lobbying efforts.
- Engage in New Collaboration: The transition requires pre-competitive collaboration across entire sectors. Companies must work together, and alongside labor associations, to ensure that the shift away from fossil fuels is a just transition that creates broad economic value.
The Road to Tuvalu
The upcoming Tuvalu Conference (April 2027) presents a historic opportunity to secure a vital international framework on phasing out fossil fuels. Between now and then, we need to establish what a meaningful, concrete business contribution to the process will look like. That clarity is still needed, and developing it is itself a priority.
The Exponential Roadmap Initiative and the Fossil Fuel Treaty Initiative convened this roundtable as a first step in exploring the level of private sector support for an international framework and whether businesses are ready to help build a mandate for negotiations in Tuvalu. The questions of how businesses feed into the process, how they engage with ministries and officials, and how a shared voice gets constructed are still open.
The private sector’s contribution must be practical and specific. Businesses need to be ready to articulate clearly the policy frameworks, infrastructure investments, and financial mechanisms required to make the fossil fuel phase-out investable at scale, moving beyond voluntary sustainability targets toward the regulatory certainty that allows the transition to flourish globally.
The transition away from fossil fuels is inevitable. Its speed and fairness are not. The solutions are in our hands; the task now is to rewrite the rules to let them scale.
The Santa Marta Process could make the fair, orderly and equitable phase-out of fossil fuel subsidies a flagship workstream. Reframed as redirecting public resources toward affordable, accessible renewable energy, energy security, quality jobs and protection for vulnerable households and workers, reform becomes a positive development agenda. The Santa Marta Process should develop and share proven business cases, policy sequencing and public-engagement models that build social acceptance across countries.
This can accelerate exponential solution scaling. Shared implementation playbooks can compress learning cycles and create reinforcing feedback loops: larger markets lower costs, lower costs accelerate adoption, and adoption strengthens political support. A critical mass of countries can shift the world from today’s high, near-flat emissions trajectory toward sustained decline.
The objective should be explicit: make coordinated subsidy reform instrumental in bending the global emissions curve this decade and putting the world on a credible pathway to halve global emissions by 2035. Reform cannot deliver this alone, but it can unlock the policies, technologies and investment needed across power, transport, buildings and industry.
