Three unmissable opportunities to make a just transition investible
At Laudes Foundation, our grants are focused on accelerating a just transition across four industries: Fashion, Built Environment, Food, and Finance & Capital Markets.
For us, this means working with our partners and other funders to accelerate industry transformations that value people, nature and climate.
To this end, we went into London Climate Action Week to properly listen – with the goal of better understanding the motivations and barriers for investors to invest in the climate transition, to hear what companies and their workers need to accelerate efforts, and to understand the challenges of governments in unlocking finance – and then to assess where we could leverage our philanthropic capital to bridge gaps.
We identified three unmissable opportunities:
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The opportunity to listen. Climate action is such an immediate problem - and we do have to act quickly - but if, in the rush, we don’t properly understand each other – if governments, financiers, companies, workers and communities – don’t align, we will slam on the brakes further down the line. Laudes is in listening mode, and we will continue to find ways in which these actors can listen to each other and start speaking a common language.
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The opportunity to find common objectives. Efforts to unlock finance focus on finding and validating projects, derisking them and creating revenues that can be invested back into just transitions. Meanwhile, governments wrestle with the need to safeguard jobs, ensuring minimal disruption to people whose livelihoods depend on sectors that need to transition. This mismatch means that the best intentions on both sides fail to deliver – we need a new framework for the discussion, and this is something we will be taking forward with our partners Green Finance Institute.
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The opportunity to bridge the gap between finance and need: We found ourselves drawn into many debates about whether the gap is a lack of available finance, or a dearth of projects. Our team concluded that it is neither – the solution lies partly in the above paragraphs about listening, understanding and creating common goals - but we also recognise there are mechanisms missing in the financial system to allow projects (from new businesses to factory upgrades or sustainable infrastructure) to access affordable finance, and for finance to find investible opportunities. We are calling this the ‘plumbing’ needed - a key area of focus for the Finance and Capital Markets programme at Laudes, in collaboration with other funders.
In a nutshell, London Climate Action Week cemented some exciting new ideas about how we create a financial system that can respond to the needs of a just transition – but I also went away doubly-convinced of the importance of the role of philanthropy as the convenor and broker of conversations.
To learn more about our work to unlock finance towards just transitions, reach out to our colleagues in the Finance and Capital Markets programme financeprogramme@laudesfoundation.org
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By Clare Hierons
Head of Finance and Capital Markets Programme
