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Tag: climate emergency

  • British International Investment to partner with City of London’s institutional investors to consolidate the UK’s position as global leader in climate finance

    British International Investment to partner with City of London’s institutional investors to consolidate the UK’s position as global leader in climate finance

    …New initiative will reduce risk for private institutions to inject capital to combat climate emergency.

    The City of London can consolidate its position as a global capital for climate finance by working with British International Investment (BII), the UK’s development finance institution and impact investor, in the battle to combat the climate emergency. 

    Last year, the UK Prime Minister, Keir Starmer, announced BII would manage a new £100 million Mobilisation Facility to boost the flow of private capital into emerging economies that are considered too risky by global investors.  

    Today, BII announced that up to £50 million of the facility has been ring-fenced for a groundbreaking new initiative. BII is partnering with Mercer, a global investment firm, to encourage the asset manager community to develop investment solutions, which will help to unlock private investment into climate related projects in emerging economies. It will also seek to address the gap between the risk appetite and return thresholds of institutional investors.  

    Emerging economies are expected to play a crucial role in global economic growth. They currently represent over 60 per cent of the world’s GDP and are projected to account for 74 per cent of global energy consumption by 2050. This creates investment opportunities in sectors like clean energy and infrastructure, offering potential for growth, diversification and impact. 

    Minister for Development, Anneliese Dodds welcomed the initiative: “Countries exposed to the climate crisis are facing extreme weather events which destabilise economies, hinder growth and displace people. Those countries need urgent access to finance to tackle and adapt to this crisis.

    “At the same time UK financial institutions are ideally placed to provide global leadership in climate finance and tap into these emerging markets, generating growth at home and providing much needed finance abroad.

    “By bringing together private and public expertise and capital, the UK is leading the world in mobilising the finance countries need to tackle the impacts of the climate crisis.”

    Asset Managers in the UK and globally, with a demonstratable track record in climate finance and interest in emerging economies, are invited to submit proposals to partner with BII. Proposals with a strong potential for accelerating private investment and which demonstrate large-scale climate impact will be granted access to concessional capital of up to £50 million from the facility. They will also have the opportunity to access non-concessional investment funding from BII. 

    Leslie Maasdorp, BII CEO said: “BII is the UK’s primary vehicle for delivering climate finance into our markets. But the scale of the climate emergency means we have to unlock the vast pools of capital that are held by private institutions. The partnership we have unveiled today is a truly innovative way of doing that.”

    Benoit Hudon, Mercer’s UK President and CEO said: “This initiative has the potential to encourage investment into new projects in emerging economies to support their economic development. Mercer will play a key role in identifying innovative asset manager proposals that support the energy transition and address some of the hesitancy institutional investors have about investing in emerging economies.” 

    For more information about the Mobilisation Facility initiative, please visit BII or Mercer websites.  

  • British International Investment Boosts Emerging Markets Investment

    British International Investment Boosts Emerging Markets Investment

    …dedicated facility believed to be the first of its type offered by a development finance institution

    British International Investment, the UK’s development finance institution and impact investor, is to launch a new facility to boost the flow of private capital to meet the twin challenges of development and the climate emergency.

    The new facility aims to unlock hundreds of millions of pounds of private investment into climate and sustainability-focused investments in emerging economies that are currently deemed to be too risky by global investors. 

    It will address the gap between the risk appetite and return thresholds of commercial investors who are currently inclined to place capital in more developed markets. 

    Nick O’Donohoe, Chief Executive of BII, said: “With the launch of this facility, BII and the UK Government are demonstrating global leadership in unlocking the private capital that is so desperately needed to accelerate the green transition in emerging economies.

    “The role for BII, and the development finance community, is to judiciously deploy concessionary finance to give global investors the confidence to put their capital where it is most needed.”

    These investments are expected to include utility-scale climate infrastructure, such as renewable energy generation and transmission; other climate infrastructure, such as water, waste-to-energy, and battery storage; green finance, through banks and specialist finance companies that lend to climate-focused businesses; and investments that deepen capital markets for gender finance.

    The facility will target deep and long-term pools of capital, such as pension savings and life insurance policies; as well as focus on asset managers in the City of London and beyond, to design investment products that increase investment allocations to emerging markets.

    BII will use the facility to support a mix of existing pipeline and newly identified projects.

  • Revealed: Four out of five businesses in emerging economies have been impacted by the climate emergency

    Revealed: Four out of five businesses in emerging economies have been impacted by the climate emergency

    …Flooding, droughts and extreme heat taking an increasing toll

    Nearly four out of every five businesses in many of the countries most vulnerable to the impacts of the climate emergency are already suffering the consequences of a rapidly changing environment. 

    The startling finding is contained in British International Investment’s third annual Emerging Economies Climate Report – a survey of its investee businesses in Africa, Asia and the Caribbean.  

    The report is being launched today at an event hosted in partnership with the Grantham Research Institute on Climate Change and the Environment and ODI, the global think tank.

    The report revealed that 79 per cent of companies surveyed said that climate change was already impacting their business, up from 68 per cent in 2022. 

    It also found that 72 per cent of corporates surveyed had experienced an extreme weather event in the last five years with droughts, floods and heat cited as the greatest cause for concern. 

    Other key findings included: 

    • 87 per cent of respondents agreed to some extent that they were concerned about physical climate risks – up from 70 per cent in 2022. 
    • 73 per cent of respondents agreed to some extent that they were concerned about the risks associated with a low-carbon transition – up from 66 per cent in 2022. 
    • More respondents are concerned about climate change affecting business growth and viability: 61 per cent thought climate change will affect the viability and growth of their business in the next five years compared with 56 per cent in 2022. 
    • More respondents agreed that climate action leads to more long-term business success and 97 per cent agreed to some extent that organisations that take steps to reduce their carbon emissions and reduce vulnerability to physical climate change risks will be more successful in the long term. 
    • The majority of respondents (65 per cent) have adapted their business strategies in response to climate change; and more are calculating their carbon footprint compared with last year (45 per cent).

    Survey responses varied across sectors and business types; financial services or fund managers cited fewer climate impacts, while corporates – particularly agricultural businesses – are facing more significant impacts. 

    While 86 percent of corporates said they are being impacted by physical and transition risks today, 68 per cent of financial services firms said the same. 

    Despite many respondents highlighting that acting on climate can be cost-saving and add long-term business value, they also noted they did not have the knowledge and resources to respond to climate risks and opportunities. Respondents to the survey said they would benefit from more technical training on how to respond to the climate emergency as well as targeted investment and policy and regulatory action.

    Amal-Lee Amin, Managing Director and Head of Climate, Diversity and Advisory, at BII, said: “Businesses and entrepreneurs across the emerging economy markets in which we operate are on the front lines of the climate emergency. Their businesses are already feeling the significant impacts of the climate emergency. 

    “As long-term investors in climate finance, it is the role of BII and others to equip these businesses with the capital and expertise to play a key role in the fight against the climate emergency and to safeguard their long-term viability.”

    Nick Robins, Professor in Practice – Sustainable Finance at the Grantham Institute, added: “This report shows the overwhelming demand among firms in emerging economies for targeted investment to enable them to respond to the climate crisis. For business and investors in the Global South, there is now a strategic imperative to scale up capital flows in ways that bring a just transition for workers and communities, shaping the transition so it boosts quality jobs and gender equality.”

    The full Climate Report can be found here