Philanthropic Financing to Unlock $3 Trillion Per Year to Reach Net Zero
The fundraising initiative would build on existing success stories of philanthropy
January 19, 2023
The World Economic Forum (WEF) launched a fundraising vehicle to unlock $3 trillion of financing needed each year to reach net zero, reverse nature loss, and restore biodiversity by 2050. The vehicle would focus on attracting philanthropic resources toward the net-zero targets.
The fundraising entity ‘Giving to Amplify Earth Action (GAEA),’ formed with the support of 45 partners, would convene public, private, and philanthropic leaders to identify and target climate and natural solutions to play a catalytic role.
GAEA aims to build on existing examples of success. For instance, the Clean Cooling Collaborative, founded with the help of an initial $10 million of philanthropic funding in 2016, has mobilized more than $600 million in public and private finance to improve equitable access to low-carbon cooling and support 4.2 gigatons of avoided CO2 emissions by 2050.
Similarly, the Government of Seychelles had leveraged philanthropic funding, public loan guarantees, and private investment to raise $15 million through a blue bond and convert $22 million of government debt into conservation funding to protect 13 marine areas, covering a size larger than Germany.
The initiative is supported by partners from philanthropic backgrounds, academic institutions, companies, individuals, and public sector organizations.
Wendy Abrams, Chief Executive Officer of Eleven Eleven Foundation, a sustainability advocacy group, said, “We need more companies, family offices, individuals, and the new generation of philanthropists to get involved in the climate and natural conversation. If we do not solve this together, there will be nothing to pass on to the next generation.”
The international non-governmental organization identified that the current level of funding for achieving net zero is inadequate. It said a new approach is required to get capital flowing to meet global climate goals and steer the planet towards 1.5°C.
While philanthropic financing for climate mitigation has risen in recent years, it still represents less than 2% of the total, estimated at $810 billion in 2021.
“To reach the speed and scale required to heal the Earth’s systems, we need to unlock not only private capital and government funds, but also the philanthropy sector as a truly catalytic force to achieve the necessary acceleration,” said Klaus Schwab, Founder, and Executive Chairman, World Economic Forum.
The recently concluded COP27 decided to execute the Sharm el-Sheikh Implementation Plan, highlighting the need for global investments of $4 trillion per year in renewable energy until 2030 to achieve net zero emissions by 2050.
During the event, India also unveiled its Long-term Low-Carbon Development Strategy, which has laid out the vision of a sustainable future and reach net zero emissions by 2070.