Today, President Biden and His Majesty King Charles III met at Windsor Castle with 23 leading philanthropists and financiers to help catalyze finance to support emerging markets and developing countries in tackling the climate crisis. The gathering followed the Climate Finance Mobilization Forum, which was convened by the UK Energy Security and Net Zero Secretary Grant Shapps and U.S. Special Presidential Envoy for Climate John Kerry, and inspired by the work of His Majesty the King.
Today’s gathering builds on longstanding UK-US efforts to turbocharge the net zero, resilient transition already underway in developing and emerging economies on the road to COP28. The Forum brought together key players to identify how we can go further faster to mobilize the private investment needed to expand clean and renewable energy across the globe, reduce both potent CO2 and non-CO2 emissions, halt deforestation and restore forests, and build resilience to a changing climate.
Recognizing the scale and urgency of the climate crisis, the gathering emphasized the importance of partnership across governments, philanthropies, and investors – given that no single actor can mobilize finance at the scale required by acting alone. The scale of this transition requires trillions in private investment in addition to the public funds we are spending. It is also one of the biggest investment opportunities in history. Private sector financial institutions and philanthropists announced a range of new investment platforms and initiatives during the event that demonstrated their commitment to concrete actions to finance efforts in Africa, Asia and Latin America. These efforts will help reduce emissions and boost climate resilience – while generating jobs in local communities and growing their economy.
Building on today’s important event, the COP28 President Designate United Arab Emirates will host a High-Level Business & Philanthropy Delivery Forum during the World Leaders Climate Action Summit. The Forum will focus on removing barriers to progress, showcasing what is working, and identifying opportunities for collaboration, and acceleration.
Key announcements from today’s event included:
- Builders Vision, Mitsui & Co. and Renewable Resources Group Partnership will identify over $1 billion of Nature-Based Solutions Projects in Emerging Markets through a new venture they are pursuing to address impacts of climate change across critical supply chains in agriculture, natural resources development, and energy. The firms seek to cooperate on activities globally where nature-based solutions – such as regenerative farming, agroforestry, and sustainable water management – can be used alongside best-in-class technology solutions and local community expertise to develop products and systems that reduce negative environmental impacts and create sustainable and mutually beneficial outcomes. These firms will identify at least $1 billion of initial project opportunities in emerging markets where investors and corporations can deliver on carbon neutrality and sustainability pledges via direct investment and supply chain participation. Potential initial investment projects span highly biodiverse and at-risk climate regions, including areas of Central and South America, the Middle East, and North Africa with ambition to expand to sub-Saharan Africa and East Asia over time. Cooperation and collaboration with multinational corporations, governments, family farmers, and others is welcomed to support these opportunities.
- Builders Vision is also committing $100 million in oceans-related investments and grants in emerging markets focused on blue carbon ecosystem conservation, oceans carbon dioxide removal, shipping decarbonization and advancing wind energy.
- LeapFrog Investments, an impact investment firm operating in emerging markets, has committed to investing $500 million in companies that are addressing climate change in Africa and Asia. Their aim is to provide green tools and technologies to 50 million low-income people, enabling them to improve their lives and livelihoods. This investment will focus on supporting companies in the built environment, energy, mobility, and food sectors, which are key areas for a green transition. By 2030, overall investments in these four sectors alone could help reduce greenhouse gas emissions substantially and could create an estimated 90 million new jobs in developing countries.
- The Tony Elumelu Foundation (TEF) is launching a $500 million Coalition for African Entrepreneurs, to catalyse a further 100,000 young African entrepreneurs and small businesses, focusing particularly on fragile states, women entrepreneurs, and green entrepreneurship. The Foundation has, since 2015, connected over 1.5 million young Africans on its digital hub, TEFConnect, and disbursed nearly $100 million in direct funding to 18,000 African women and men, who have collectively created over 400,000 direct and indirect jobs. The Coalition is open to development agencies, the global private sector, philanthropic organisations, and governments to create meaningful change and empower Africa’s next generation. Creating a green entrepreneurial revolution is fundamental to the Coalition, as we embed sustainable practices and solutions across the next generation.
- The Sustainable Market Initiative (SMI) has announced its Terra Carta Accelerator Fund with a target of £100 million. The initial focus of the Accelerator Fund will be to bring natural capital projects, with climate co-benefits, to investability and scale with a focus on emerging and developing markets. It also aims to pilot Nature and climate-aligned supply chain transitions across industries globally. The Accelerator Fund builds on a challenge from His Majesty King Charles III to ensure the private sector is helping to scale a minimum of five land-based and five marine-based projects a year to 2030 as a significant contribution to the Global Biodiversity Framework including the effective conservation and management of at least 30% of the world’s land, coastal areas and oceans in addition to the restoration of 30% of terrestrial and marine ecosystems. The members of the Sustainable Markets Initiative’s Financial Services Task Force have committed over $8.9 trillion to support the transition to net zero by 2030 (or sooner) and have already provided and mobilized over $2.5 trillion in capital as part of those commitments since 2020/2021.
- Forrest Group (Fortescue, Minderoo Foundation and Tattarang) will pursue a unique portfolio of blended philanthropic, private and public finance with seven priority actions to continue the scale-up of its green metals and green businesses, including (1) embarking on a new project of work with the Green Hydrogen Standard 2.0 at COP28 to ensure standards are set in a way that helps emerging economies thrive while also partnering with leading African universities to develop the skills required to enable the hydrogen industry in Africa; (2) developing an ethical and secure supply chain for critical clean technologies with practical initiatives such as transforming an existing, surplus geothermal energy source to generate green hydrogen in Kenya; and (3) building an estimated $20 billion in renewable energy projects across the world, including in Africa, Australia, Europe and Latin America. Projects are expected to be financed in the rapidly developing green, structured finance global capital markets.
This is in addition to recent pledges and initiatives from Forum participants showcasing climate leadership:
- Boston Consulting Group: BCG previously announced that it expects to invest $2 billion in the next decade to reach their “Net Zero by 2030” commitment and to provide consulting support to society and organizations in addressing critical climate and sustainability efforts across a broad range of partnerships including with UN Framework Convention on Climate Change Conference of the Parties, the First Mover Coalition, and many others. They supported the initial set up of the Energy Transition Accelerator (ETA) design process and are excited about its potential. While important design issues remain to ensure high-quality credits and clear recognition of companies’ contributions, they are optimistic these issues can be successfully addressed, and in that case, expect to become a founding partner in the ETA community and encourage others to participate as well.
- BlackRock: At COP26, BlackRock announced the final close of the Climate Finance Partnership (CFP), a blended finance investment vehicle that seeks to accelerate the flow of capital into climate-related investments in emerging markets. So far in 2023, CFP has committed approximately $190 million into renewables investments in Kenya and the Philippines, and has approved the deployment of a further c. $90 million into two additional investments, both in emerging economies in South East Asia, which will be announced (subject to certain conditions) in due course. Following these capital commitments, CFP would have around $390 million of capital for deployment into future emerging markets climate technology investment opportunities.
- Bloomberg Philanthropies, in partnership with the Glasgow Financial Alliance for Net Zero, will build on its long-term commitment to move the world beyond coal and keep the 1.5°C global warming target within reach. To address the specific challenges involved in accelerating a successful managed phaseout of coal power in emerging economies, Bloomberg Philanthropies will expand its support for Just Energy Transition Partnerships in countries including Indonesia and Vietnam, with a focus on ways for public and private finance to work together to unlock capital to enable economies to reduce coal and ramp up the development and deployment of clean energy. In addition, Bloomberg Philanthropies will help develop global and local standards and policy frameworks to ensure that the managed phaseout of coal is done in an effective and orderly manner. This includes developing and delivering concrete integrity guidelines by COP28 for the use of carbon credits in incentivizing earlier coal retirement, avoiding the planned release of millions of tons of carbon dioxide into the atmosphere.
- Community Jameel, a global organisation focused on helping communities thrive, has announced that they are increasing their funding for climate initiatives ahead of COP28. The funding will support projects like the Jameel Observatory-CREWSnet, a platform that predicts climate change to help communities adapt. Community Jameel is committed to addressing climate change, particularly its impact on vulnerable communities. They will continue their efforts to combat food insecurity through agricultural innovation and climate-smart agriculture.
- Ninety One, a global investment manager, has announced initial funding for its new strategy called Emerging Market Transition Debt (EMTD). This strategy aims to provide commercial financing to support real-world efforts in reducing carbon emissions where it is most needed. The firm is now raising more funds with the goal of turning EMTD into a large-scale initiative worth billions of dollars. By actively participating in the Sustainable Markets Initiative, Ninety One is contributing to the creation of a new investment category focused on transition debt. They provide credit to high-emitting companies that have a strong potential for transitioning towards sustainability. The aim is to inspire other companies to offer similar opportunities and promote transition financing on a larger scale
- Three Cairns Group and Sea Change Foundation International announced the formation of Allied Climate Partners, Inc. (ACP), a philanthropic investment organization with a mission to increase the number of bankable, climate-related projects and businesses in emerging markets and developing economies to create significant environmental, economic, and social impact. ACP will select regional investment managers in Southeast Asia, Africa, the Caribbean and Central America, and India and support them with capital and the expertise necessary to increase the number of climate-related projects and asset-oriented businesses by investing at the early-stages of the development process. The initiative will be formally launched at COP28.
- The World Bank’s Private Sector Investment Lab have announced 15 Chief Executive Officers and Chairs who will make up the Lab. The founding members comprise a core group charged with developing solutions to address the barriers to private sector investment in emerging markets and developing countries – including leaders from AXA, BlackRock, HSBC, Macquarie, Mitsubishi UFJ Financial Group, Ninety One, PIMCO, Ping An, Royal Philips, Standard Bank, Standard Chartered, Sustainable Energy for All, Tata, Temasek, and Three Cairns Group. The Lab will identify new approaches, building on the World Bank’s current work, to address existing barriers and develop solutions, with the ultimate goal of crowding in greater levels of private finance in emerging markets. The Lab will initially focus on scaling transition finance in renewable energy and energy infrastructure.
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