Philanthropy can play a value role in catalyzing innovation for climate action. Image: Getty Images/iStockphoto
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- Climate change is impacting people across Asia more than ever, with the region hit by increasingly intense tropical cyclones and increased rainfall.
- Governments and business leaders need to accelerate action on climate change, and funding needs to rise by more than $3 trillion a year.
- Philanthropy can play a pivotal role in catalyzing the capital and innovation required, and this will be a key focus of the One Earth Summit 2024.
Climate change is impacting the lives of communities across Asia more profoundly than ever, with regional changes including the intensification of tropical cyclones and increased rainfall leading to flooding.
As recently as October, Hong Kong SAR witnessed severe flooding as a result of Typhoon Koinu, which brought heavy rains and strong gales just a month after the city had been paralysed by unprecedented rainfall.
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Such events make it impossible to overlook the urgent climate crisis, leading governments and businesses to intensify their efforts in addressing it. Indeed, funding for equitable climate and nature transitions should be increased by more than $3 trillion per year.
If we are to have a chance at meeting these goals, we must mobilize all actors in the capital stack to play to their strengths at each point in the climate and nature innovation journey.
Philanthropies, corporate philanthropies, and other entities play crucial roles in creating enabling environments, addressing obstacles and fostering early-stage innovation. This includes activities such as impact investing, funding from family offices and venture capital for startups, and various stages of capital infusion for innovators.
Multilateral development banks (MDBs) contribute by providing concessional capital and shouldering substantial risks with their financial products. Additionally, multinational corporations leverage their research and development efforts and commit to send demand signals to support development of innovative products and solutions.
Governments play a vital role by offering fiscal incentives and utilizing their public purchasing power to send market signals. The collective goal is to assist private capital and markets in making sustainable climate and nature investments the new norm in the marketplace.
None of these actors can lower the green premiums of the transitions in every sector on their own. Only a full and global orchestration of actors in the capital stack, to each use their superpower in the right place at the right time – will get us there.
Urgent need to tackle climate change and biodiversity loss
Anticipated carbon emissions from the current fossil fuel infrastructure, in the absence of further abatement measures, is anticipated to exceed the remaining carbon allowance for limiting global warming to 1.5°C.
Meanwhile, the alarming loss of biodiversity, with approximately 1 million species facing the risk of extinction, underscores the pressing nature of the situation.
This challenge is particularly apparent when we consider that half of the 169 targets in the United Nations’ Sustainable Development Goals (SDG) are not making sufficient progress toward their 2030 objectives, with an additional 30% showing signs of stalling or regression.
Driven by a vision to foster collaboration and transformative solutions, innovation becomes a catalyst for change by finding novel solutions to complex problems. From sustainable food systems to the conceptualization of cities that harmonize with nature, innovation paves the way for a convergence of talent and technology that is not only necessary but timely.
By fostering strategic partnerships and investing in areas such as renewable energy, where global investments are estimated to have reached $358 billion in the first half of 2023, we unlock the potential to revolutionize industries and make sustainable living achievable.
For example, the Southeast Asia Clean Energy Facility (SEACEF) directs early-stage development capital investment into innovative, high-impact clean energy projects and businesses in critical Southeast Asian markets. It has managed to coordinate and blend philanthropic with investor capital and government action to scale clean energy operations and accelerate the low carbon transition across the region.
How philanthropy can catalyze climate and nature solutions
Philanthropy is one of the pieces that can catalyze climate and nature solutions and bring other financial actors on board. Philanthropy can be the glue.
By fostering strategic public, private and philanthropic partnerships (PPPPs) and global collaboration, the Giving to Amplify Earth Action (GAEA) initiative posits that transformative changes across sectors like clean energy and sustainable food systems can be achieved.
Philanthropy can catalyze people-focused climate and nature solutions as it can play a key de-risking role and unlock both public and private funds through being uniquely nimble, risk tolerant, flexible, equitable and tolerant.
In Western India, for example, women use orange metal dryers to dehydrate and process excess or lower-quality crops, thereby reducing waste. The company behind the dryers, S4S Technologies, was recently named as one of five winners of £1 million ($1.2million) from the Earthshot Prize, highlighting the tangible impact of grassroots innovations in creating a more resilient and inclusive future.
Meanwhile 1t.org and UpLink joined forces to catalyze an 'ecopreneur' revolution for global tree restoration. The collaboration with UpLink has spawned 10 innovation challenges, connecting more than 100 top innovators and generating $100 million in additional funding for impactful solutions, fostering a community dedicated to conserving, restoring and growing global forests.
Asia and Hong Kong SAR can play key roles in climate and nature action
This highlights Asia’s pivotal role in the global climate and nature conversation, identifying it as both a key contributor to climate and nature challenges and a potential harbinger of sustainable solutions.
Meanwhile, Hong Kong SAR is underscored for its unique ability to drive sustainability transformation, embodying the transformative potential of the region. Its blend of East and West, along with a robust financial sector, makes it a hub for fostering international collaboration and pioneering sustainability transformation.
With the support from the government of Hong Kong SAR and with the World Economic Forum as knowledge partner, the Institute of Science and Technology will host the inaugural One Earth Summit in Hong Kong on 28 March 2024.
At a time when leaders and policy-makers must forge a united front on climate change, the One Earth Summit 2024 will be an opportunity to catalyze innovation and collaboration, inviting contributions to our shared journey toward a sustainable future.
By bringing together philanthropies, family offices, venture capitalists and impact investing with corporates, designing key PPPPs to unlock key levers, and accelerating the transition of corporate practices towards sustainable business models, we can tap into philanthropy’s catalytic nature to unlock and de-risk.
This, in turn, can help design joint efforts between capital stack leaders which unlock scale to transform markets in half the time. While philanthropy cannot solely fund infrastructure or technological innovation, it can strategically catalyze progress.
Next year’s One Earth Summit aims to inspire innovative strategies, including forging new philanthropic-public-private collaboration models, across the themes of clean energy, food and water security, ocean stewardship, as well as biodiversity conservation and restoration – with an emphasis on mobilizing communities and scaling successful innovations into large-scale implementation.
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The views expressed in this article are those of the author alone and not the World Economic Forum.
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