Earlier this year, the World Bank announced a fundamental shift in its role of alleviating global poverty, by refocusing its financing efforts towards tackling climate change through the lens of SMEs. Last month, the group launched a new Climate Business Innovation Network (CBIN) during COP22 in Marrakech to help commercialize and diffuse clean technologies through developing countries. Just last week, consultancy firm the Carbon Trust announced that it will be one of the first organizations to team up with the World Bank in support of the new network.
The firm is one of the 13 global organizations — including the UK Department for International Development, the Global Impact Investing Network and the Los Angeles Cleantech Incubator — to initially sign up to the network, which aims to help 12 developing countries across Africa, South East Asia and the Caribbean in their transition to clean energy and other climate-smart paths by building local capacity and linking small businesses to global sources of technology, finance and expertise.
The program will provide access to the expertise and know-how needed to adopt innovative business models that have been proven in other countries, ultimately allowing developing countries to implement their Nationally Determined Contributions under the Paris Agreement on climate change.
The CBIN will initially consist of 30 organizations and government departments — including foundations, non-profits, bilateral donors, accelerator networks, business associations, multinational corporations, investor networks and social impact funds — from across the globe including the US, UK and the Netherlands. As the network expands, more organizations will join to enhance the service offerings.
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Carbon Trust chief executive Tom Delay said: “Co-operation can be a real catalyst for change. There are some very promising business models and technologies being put into practice today in developing countries, which can work across multiple country contexts once adapted to address local needs and capture local opportunities.”
“What is more, sharing stories of failures and successes can help increase confidence, reduce risks and unlock finance, all of which are hugely important. The World Bank’s new Climate Business Innovation Network can harness the power of innovation and collaboration to unleash private sector solutions to climate change and sustainable development.”
The CBIN will specifically focus on spreading models to enable climate innovation both locally and globally to create new technologies for climate mitigation and adaptation; diffusing disruptive business models in a commercial manner that creates jobs and investment opportunities; and gather global funding resources to help finance climate tech innovation and channel them effectively among a pipeline of promising options. This will require breaking down barriers such as a lack of knowledge, high transaction costs and challenges to align different investor interests.
The network builds on the World Bank’s Climate Technology Program, a $70 million initiative that catalyzes the growth of climate technology sectors in developing countries through small and growing businesses.
Over the next decade, The World Bank expects investments in clean technology sectors in developing countries to top $6.4 trillion globally, with $1.6 trillion of that market accessible to SMEs. The CBIN can help leverage the available financing for climate solutions in local markets, and in doing so, it can both help diminish the stresses of climate change on vulnerable populations while improving their livelihoods with the benefits of newly introduced climate solutions.