Koç Holding Vice Chairman Ali Y. Koç has called for climate policies to be brought closer to economically sustainable business models, arguing that companies increasingly compete not only with their direct rivals but also with the economic systems supporting them.
Speaking at the COP31 Business Forum New York Dialogue during New York Climate Week, Koç said differences in financing costs, government support and climate regulations were increasingly affecting the competitiveness of businesses operating across different markets.
The event, held ahead of COP31, brought together representatives of the global business community and was hosted by the Union of Chambers and Commodity Exchanges of Türkiye (TOBB) and Bloomberg as part of New York Climate Week. The opening session featured TOBB President and COP31 Business Forum Chair M. Rifat Hisarcıklıoğlu, Bloomberg founder Michael R. Bloomberg and Türkiye’s Environment, Urbanization and Climate Change Minister and COP31 President Murat Kurum.
Koç spoke alongside International Energy Agency Executive Director Fatih Birol, International Finance Corporation Managing Director Makhtar Diop and International Chamber of Commerce Secretary General John W.H. Denton on a panel titled “The Private Sector Response to the COP31 Action Agenda.”
Koç said companies operating in emerging markets can face financing costs two or three times higher than those in developed economies, while also dealing with shorter financing maturities and different regulatory environments.
“When you face strict climate policies in your own country while your competitor operates under much more flexible rules, the price pressures you face will also be different,” Koç said.
He argued that establishing identical public and regulatory policies worldwide was unrealistic, but that countries could still work to narrow the gap between climate objectives and economic realities.
“We can bring these two elements closer together. We can do what is right from a climate perspective while also putting it on an economically rational and sustainable footing. The closer these two elements get, the more positive the results will be,” he said.
Koç also pointed to differences in government incentives, saying companies in China were reported to have received up to eight times more government support and incentives between 2004 and 2025 than companies in other OECD countries.
Türkiye needs to accelerate renewable energy and electrification
Koç said expanding renewable energy and electrification should be a priority for Türkiye, particularly as energy security and climate concerns increasingly overlap.
“It is indisputable that we need to increase renewable clean energy and electrification to make our country more competitive and enable our companies to compete with global giants,” he said.
He described the Strait of Hormuz as a short-term concern, while warning that rising energy demand and dependence on imported fuels presented longer-term challenges for Türkiye.
“Because we depend on imported fuels, this directly affects all our business lines, inflation and the cost of doing business,” Koç said, adding that energy supply security had become a major concern.
He argued that a greater shift toward renewable energy would benefit businesses across the economy, regardless of whether they operate directly in the energy sector.
Production and storage capacity need to grow together
Koç also stressed that Türkiye’s renewable energy transition needs to be supported by sufficient energy storage capacity.
He said Türkiye already had renewable capacity capable of meeting around 60-63% of its energy needs, describing the figure as a significant increase compared with a decade or 15 years ago.
However, he said limited storage capacity meant that only around 40% of this potential could currently be utilized.
The combination of generation and storage, he argued, will therefore be critical to making the country’s renewable energy capacity more effective.
Climate transition requires long-term leadership
Koç also emphasized the importance of strong leadership in pursuing climate policies whose costs and benefits extend over many years.
“Doing the right thing can sometimes mean losing a competitive advantage, and that requires serious leadership,” he said.
He cited Koç Group’s activities across energy, automotive, durable consumer goods and financial services as an example of how the transition can be managed simultaneously across different industries.
Koç said the group’s CEO had launched its Carbon Transformation Programme a decade ago and that the company had since reached a position that was recognized internationally, while acknowledging that the transition had required significant financial and time investments.
“That is why leadership is extremely important,” he said.
Transformation must extend across the entire value chain
Koç also warned that the impact of the green transition would remain limited unless smaller companies and suppliers were included.
“Looking at the world as a whole, SMEs and small companies are by far the majority,” he said. “Large companies therefore need to be very active in helping transform the entire value system.”
He argued that progress across the broader value chain would be essential for businesses to maintain the benefits of the transition and for climate action to have a wider economic impact.
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