This is the first in a CESR series of blogs on the just transition. This blog situates the newly established Just Transition Mechanism within CESR's broader work on fiscal justice and human rights-based climate finance. The second blog, by Peninnah Mbabazi, examines what a rights-based just transition looks like in practice through the lens of critical minerals and Africa's green industrialization.
Matt Forgette, Climate Program Associate, CESR
Every year, pollution from fossil fuels kills more than 5 million people worldwide. Over the next 15 years, more than 132 million people could be pushed into poverty due to the adverse effects of the climate crisis. Most of that population consists of already-vulnerable communities in the Global South. Simply put, the need to rapidly decarbonize the global economy and build towards a renewable energy future is well-understood, even if the responsibility to do so is willfully abdicated by many of the world’s most powerful leaders and harshest polluters. However, what is less understood, but no less vital, is how to effectively transition our economy towards a green future that respects and realizes human rights.
The global conversation on a “just transition” has often been reduced to a narrow focus on labor shifts or energy reforms. CESR approaches it differently. At CESR, a just transition represents an imperative for human rights and economic justice. It necessitates a transformation of the global economy that eliminates, rather than multiplies, the inequalities that have defined the fossil fuel era. As we have explored in our Key Concepts guide, the climate crisis has already harmed women, Indigenous peoples, rural communities, children, and Global South populations most severely. A Just Transition requires redistribution of resources, expansion of fiscal space in the Global South, and the provision of reparations for historical harms.
This broader vision is especially important now, as the world begins to operationalize the new Just Transition Mechanism created at COP30.
A new global mechanism and a new opportunity
Despite its well-documented shortfalls on climate finance, COP30 marked a turning point in discussions around the just transition. After years of Global South advocacy, including the civil society push for a Belém Action Mechanism, countries agreed to establish a global Just Transition Mechanism under the Just Transition Work Programme. Despite resistance from wealthy Global North countries, negotiators converged on a mechanism rather than a comparatively weaker “action plan”. As described by Dr Amiera Sawas, head of research and policy at the Fossil Fuel Non Proliferation Treaty Initiative, the action plan was a “less ambitious proposal” that was “more about mapping and understanding what potential initiative exists”. The final text instead includes the most progressive rights‑based language ever adopted in a COP outcome, recognizing labor rights, human rights, the right to a clean environment, free, prior and informed consent, and the inclusion of marginalized groups.
Despite these optimistic outcomes, the negotiations also revealed the political constraints ahead. References to fossil fuel phaseout, critical minerals, and trade‑related impacts were removed, and questions around funding remain rather typically unresolved. The mechanism creates a new institutional framework for cooperation and technical assistance, but its direction and ambition are yet to be decided. That very uncertainty makes the contribution of civil society, labor, and the Global South at large especially important. And it makes the coming year, in the lead-up to COP31 in Antalya, a crucial window for shaping what this mechanism becomes.
Why a fiscal justice lens matters in the just transition
Much of the global debate on just transition currently focuses on technology, labor, or energy-sector reforms. These debates are critical and should not be undermined or underexplored. But what is often missing from these discussions is a clear understanding of how countries, particularly those in the Global South, can finance a transition that is equitable, rights‑aligned, and socially transformative. The funds required for the climate transition are estimated at $2.7 trillion per year between 2025 and 2030 for the Global South alone. Today's climate finance and domestic resources fall drastically short.
CESR’s longstanding work on tax justice, debt justice, and rights-based public climate finance fills this gap. We have warned against dangerous distractions like blended‑finance schemes that socialize risk and privatize returns, loan‑heavy climate finance that worsens debt burdens, and the ever-expanding role for multilateral development banks without robust human rights safeguards. These approaches replicate and sadly even multiply the very inequalities a just transition is meant to address.
A rights‑based transition must be publicly-financed, governed by and accountable to Global South countries, and designed to expand fiscal space for social protection and public services. This necessitates making taxation more progressive and redistributive, so that those with higher incomes, larger fortunes, and greater responsibility for climate damage contribute a greater share. It requires ending perverse incentives, the tax breaks and $7 billion in subsidies that continue to flow to fossil fuel industries while clean energy remains underinvested. And it demands cracking down on tax abuse: the corporate profit-shifting, offshore havens, and illicit financial flows that drain public budgets, especially in the Global South. In 2024 alone, the world's major fossil fuel corporations generated $583 billion in net profit, while governments in climate-vulnerable countries faced shrinking fiscal space and rising adaptation costs.
If implemented with the proper ambition, the Just Transition Mechanism could help shift the global climate finance system away from our current fragmented, loan‑based model and toward the public, grant‑based support that strengthens countries’ ability to fulfill economic and social rights. It could anchor equity, labor rights, and human rights at the center of economic transformation, support universal social protection and public services, and elevate Global South leadership.
Where we go from here
The early development of the JTM requires solid foundations. Human rights can fill that requirement by providing legitimacy, legality, transparency, and accountability. At CESR, we aim to contribute rights‑based indicators and accountability tools, drawing on research resources like our Decoding Climate Finance Injustice guide. Joining forces with other CSOs, academia and unions, we can challenge the drift toward private‑sector‑led and loan‑based transition models, and make the case for public, grant‑based climate finance that expands fiscal space rather than shrinking it. We also want to amplify community-led visions of transition and help build cross‑movement alliances that bring together climate justice, labor rights, feminist economics, and human rights advocates.
All of the actors identified above must collectively insist that the Just Transition Mechanism lives up to its name. The energy transition will touch every sector of the global economy, from public finance to labor markets to the extraction of the raw materials that renewable technologies depend upon. As Peninnah Mbabazi will explore in the second blog in this series, the governance of critical minerals is one of the most urgent and under-examined fronts in this struggle, and one where the gap between the rhetoric of just transition and the reality on the ground is already painfully wide.
The creation of the Just Transition Mechanism is a victory, but its future is far from guaranteed. The coming year will determine whether it becomes a tool for genuine transformation or another technocratic UNFCCC exercise. CESR’s role is to help ensure it delivers on its promise: a transition that is equitable, rights-aligned, and capable of reshaping the global economy in ways that leave no one behind.