Levers of Acceleration for Finance in Common

A Climate Civics International policy brief outlining tools and strategies for accelerated mobilization of wider pools of capital, through institutions and mechanisms participating in the Finance in Common Summit and network.

2024 was the hottest year on record. In fact, it was far hotter than expected, and new evidence suggests the reason is relatively simple: global heating has been advancing faster than reported, and was concealed by non-carbon pollution that needed to be reduced to protect human health.

Acceleration of global heating and climate disruption means costly impacts will be more common, more disruptive, and more likely to compound each other’s effects. It also means calculations to date about climate costs are likely lower than they need to be to guide sound decision-making.

At this crucial moment, we see the world’s leading provider of development assistance suspending, and possibly ending, major programs that provide vital support to vulnerable communities. If such aid is not delivered, we know the trends toward local destabilization will rapidly worsen in many places, and safeguards against the spread of conflict will be undermined.

KEY MESSAGES

No one is immune to climate danger.
Trace teleconnections to make local innovation smarter.
Activities that improve food systems, income inequality, and infrastructure can generate major return on investment.
Cities can play a leadership role in transforming landscapes and improving health and opportunity.

No One is Immune to Climate Danger

After decades of prioritizing the moral and legal responsibility to provide protection to those made unduly vulnerable by unsustainable industrial practices, a new threat to human security appears to be on the rise. Leaders in countries that see significant revenues from climate polluting practices appear to believe they can protect themselves, their allies, and maybe their entire countries from climate breakdown, if they can capture windfall profits in the short term.

The uneven distribution of climate vulnerability does not mean some people and places are immune. The most fortunate will develop better safeguards against their own personal and regional climate risk, but they cannot stop uncontrolled climate disruption from undermining the sources of value they depend on for their wealth. Even the best funded fossil fuel operations cannot operate safely during ongoing climate shock events.

Disruptions are also now likely to come from far away. As more and more countries see populations migrate to cities and rural areas depleted by industrial-style extractive agriculture, more countries depend on imports for basic food items. Climate disruptions are affecting producer communities, production and transport, storage and shelf-life, and degrading ecosystems and biodiversity, creating further nonlinear risks.

There is now an unprecedented opportunity for development to avoid the dirtiest excesses of first- and second-wave industrialization. Making that strategic leap will help avoid major disaster costs and support sustainable shared prosperity. Image: Lasse Rindsborg.

In the United States, one of the major drivers of high food prices is the impact of spreading avian flu on the availability of eggs. More than 148 million chickens have been euthanized to reduce the spread of the virus, and to reduce the likelihood of spillover into the human population. At least 70 human cases of avian flu have been reported in the US, as well as a few dozen elsewhere. At least 500 species of bird and 70 mammal species are affected.

At this writing, an unknown disease has been reported in the DRC. The disease kills those infected about 48 hours after onset of symptoms. In one village 2/3 of those infected died. Overall, about 11% of symptomatic cases have been fatal. The first cases appear to have affected three children who ate a wild bat.

In the US, there is an outbreak of measles, a once eradicated disease, in rural areas of Texas and New Mexico with less health infrastructure than other areas of the same states. In Wuhan, China, a new bat pathogen has been detected. In east Africa, ebola has been spreading, and recent disruptions to USAID operations have raised concerns about uncontrolled spread.

Underinvestment in the health of people and of natural systems, or shortcut measures like the widespread use of preventative antibiotics in farm animals, lead to costly consequences, including direct threats to human health and the stability of local economies. As climate disruption worsens and intensifies, more ecosystems will be disrupted, and more species will migrate, creating additional risk of new disease emergence.

The One Health standard—recognizing that the health of our home planet, its local and regional life-sustaining ecosystems, and human health, are interconnected—provides an important window into how we can measure which financing options will do the most to generate sustainable value. We look to leaders at local, national, and international levels, and in the private sector, to build One Health insights into financial metrics.

Connections and Teleconnections

Novel pathogens are one environmental risk that rises as ecosystems and biodiversity break down and climate disruption worsens the impacts, forcing migration of people and of other species. The destabilizing impacts are clear, as the world’s wealthiest country has just experienced a major political upheaval, in part because of frustration over food prices.

Noting the need for urgent action to increase investments that support macrocritical resilience, in countries at all levels of income, we recommend renewed exploration of connections and teleconnections, to inform financial data and other performance metrics that drive decision-making. The aim of this recommendation is simple: We need to begin connecting the dots in ways we have not done to date.

Global heating drives local changes in climate, which impact fresh water availability and the health and resilience of ecosystems. This affects food production and the economics that determine what kind of lives are possible for people in food-growing regions. These close connections between climate, nature, and food, then produce both local and wider economic impacts.

We will not, however, achieve sufficient precision in multidimensional climate and nature-related financial metrics if we do not include detailed consideration of teleconnections. Long-distance connections, operating across overlapping but diverse timescales, make up the majority of climate-related cause-and-effect relationships. Many are layered or evolve unpredictably over time, but the long-term effects are well understood and can be defined in precision metrics.

For instance, changes in polar ice cover, including both sea ice and major ice sheets in Greenland and Antarctica, can have long-running secondary effects throughout the climate system, across all regions. With Arctic Ocean ice at record lows in recent years, there is less reflective surface to slow global heating, and ripple effects are being felt through all regions.

The difference between white reflective ice and deep, dark ocean water is not a local phenomenon. It is a planetary-scale change, altering mechanisms that control energy flow throughout the Earth system. Such teleconnections are traceable, but too often ignored. Photo: Annie Spratt.

An immediate effect of this trend is the disruption of optimal temperatures throughout the year to support the ecosystems that allow specific species to grow reliably for harvest. Well before a major harvest failure, the teleconnection between polar ice, temperature and weather patterns, moisture and watershed resilience, is already showing up in detectable ways.

Without robust, detailed, close-to-realtime information from polar regions feeding into a wider system for resilience valuereporting, we will have incomplete information about which commercial, investment, and policy choices create the most good, or the most harm. Local processors of data and finance can help to integrate Earth systems data into financial arrangements, climate solutions, and reporting on both.

Small businesses that effectively leverage labeling to boost visibility and desirability of these metrics can reach scale and change markets, attracting new capital. Public policy and investment—including through bridge funding, incubation, impact collaboration, and co-investments—should support such local endeavors and promote integration of climate, nature, and health data into financial decision-support data.

Stresses and Solutions

Among the challenges facing the global community at this moment is worsening of income inequality, not only between rich and poor, but between capital and labor. As more and more new income goes to capital, the focus on improving marginal gains on recent new capital income effectively pulls investment out of the paid-labor economy. This has the effect of reducing the funding available for wages increases, and distorts pricing models in key sectors, including housing, food, health, and energy.

A 2024 IMF-G20 Background Note on links between trends in economic growth and inequality found weak or uneven growth can reduce opportunities for reversing inequality, while depending on growth to reverse inequality can have the opposite effect. It is increasingly clear that as financial actors grapple with the challenge of adapting their operations and assumptions to a climate-disrupted world, new approaches to direct investment in human wellbeing need to be identified and mobilized.

Our recent update on the participatory Capital to Communities approach to sustainable finance emphasized localizing investments, capacity building, and programmatic expansion of opportunity. The report notes two virtues of localization that seem to have support across diverse political perspectives and economic interests:

Funding for value-building, sustainable development needs to get to the places where it will improve lives, livelihoods, and long-term outlook, more efficiently.
Strategies and metrics to track performance need to be more relevant to local conditions, so more can be achieved in the short-term, and the benefits can endure, attract further investment, and compound positive effects.

We wish to highlight, for consideration by the Finance in Common Summit participants and collaborating institutions, three ways in which food-related financial innovation can support localized value-building efforts that reinforce and expand the foundations of shared, sustainable prosperity:

Co-financing: Food-related financial innovation requires several improvements that are hard to achieve for any one actor, or without the support of economy-wide policies. A co-investment platform for food systems transformation, now in development, could change what is possible, by facilitating cooperative financing arrangements that any investor could potentially buy into.
Data: The Integrated Data Systems Initiative has released a Blueprint outlining key challenges and areas of innovation that would enable multidimensional performance tracking and value rating, for investments in food systems. The report details strategies for connecting data platforms working on differentiated timescales and covering disparate areas of sustainability-related activity, and calls for safeguards against distortions and abuses that could arise from the use of new AI technologies.
Cities: Cities have the potential to act as engines of innovation, and to anchor region-wide food systems transformation initiatives, creating new markets and demand for sustainably produced foods. The Food Trails Impact Investors Living Lab produced a Roadmap aimed at improving design and delivery of impact investment initiatives to bring new capital to such efforts.

We recognize the the 2025 Finance in Common Summit calls for progress on Inclusive Finance, Digital Transformation, and Infrastructure. We see these as intimately connected and mutually beneficial. We also see it as necessary to highlight the efficiencies that can be achieved by combining the Capital to Communities approach to Good Food Finance and other areas of cooperative financial innovation, supported by integrated data systems that provide multidimensional performance tracking insights.

The infrastructure needed in our historical moment must afford easier and more affordable pathways to electrification and to integrated and traceable supply chains. This can ensure better health, reduce likelihood of pathogen spillover, and maximize chances of early detection of emerging risks to public health and timely coordinated response.

Infrastructure changes what is possible for economic improvements across the landscapes it touches. Value chains, geophysical teleconnections, multidimensional data systems, and the sharing of technology and cooperative financing, are key to building resilient economies in this time of polycrisis. Image: Casey Horner.

We need to see new employment opportunities all along those value chains, including for savvy MSMEs that effectively combine expanded financial reach, precision insights, and value-building infrastructure, suited to sustainability and resilience needs. For instance, better transport, storage, and distribution infrastructure can reduce food waste and optimize value flow through agricultural supply chains.

We offer the examples listed above as some of the actionable priorities we believe public development banks can engage to mobilize capital, catalyze expanded private investment, and improve overall impact and metrics.

Leadership in the Polycrisis

In June 2024, we put forward seven areas of action where the G7 could show leadership by example, to catalyze financial innovation to address and overcome the polycrisis. Public development banks, local governments, and national economic development programs, country contexts at all levels of income, can add more value to the mainstream economy, by advancing investable opportunity in these same seven areas:

First, we need greater everyday action to manifest, protect, and expand climate value—reduce risk, build resilience, transition industries to clean practices, and make sure finance and trade help actors large and small, rich and poor, be part of the building of climate value, at home and around the world.
That will mean enhancing alignment of pricing measures and regulations, setting trade standards, and providing incentives for both nations and industries to compete inside that better marketplace.
Data systems will be critical in all areas—linking Earth science platforms into financial data flows, supporting advanced green labeling, including for the downscaling of capital flows to vulnerable and marginal communities, to support better outcomes for people and for the planet.
A critical application of integrated data systems is early warning capacity, which can save lives, protect infrastructure and investment, and prevent multi-generational debt burdens from halting development.
Nature and biodiversity are foundational to human health and wellbeing. The G7 can set standards that reward banks and financial institutions for prioritizing support to business practices that restore nature and protect biodiversity.
All of the above are necessary to secure food supplies now and into the future. Aligning food systems finance, production and distribution methods, and consumer food sovereignty (access, affordability, labeling, and transparency) with planetary health goals can support better health outcomes, everyday background human development, macroeconomic stability and resilience, and decent and enduring livelihoods for agricultural communities.
Participatory civics needs to be a priority, not only inside of already democratic countries, but across the world. The G7 can leverage their resources in all areas to invite trading partners, and other allies and rivals, to provide more structural freedom and redress to their people, so the opportunities for corruption, impunity, menacing of activists, and greenwashing, are reduced.

All actors need to find ways to lead, when multiple converging crises can affect value considerations and future opportunity in any context. Throughout these seven areas of action, we recognize the need to prioritize high-quality, empowering, actionable, and value-building insights.

GO DEEPER

The more reliable, factual, actionable resilience insights everyone has, the better the whole of society will be able to adjust to fast-moving complications and transcend this moment of risk and fragility. Core goals for public development banks should be to:

let more economic actors play transformational roles, as the resilience economy takes root and expands, and…
support early warning and adaptive capacity for everyone, by providing the most open access possible to independent, high-quality scientific evidence.

Conclusion

We are entering a new period in the evolution of cooperative human development. Much of what marks this new period is the rupture of long-running levers of stability, both in natural systems and in the human decision spaces of public policy and investment.

The breakdown in natural systems, worsening threats to coastal resilience, still unaccounted costs of unsustainable activities, and potential shock disruptions of the global food supply, all require fast-paced innovation and new modes of cooperative problem-solving. Emerging cooperative efforts between nations and between non-sovereign partners (cities, banks, businesses, and provincial governments) hold great promise to set conditions for sustainable prosperity in coming decades, but time is running out to secure the optimal outcomes.

At the same time, we are seeing a retreat by leading donor countries from the time-tested cooperative human development infrastructure. If investment in cooperative human development is rolled back, at this crucial moment in human history, all human endeavors will suffer, including those industries that hope to profit from public resources being reoriented to boost private business. That is because without the efficiencies of public infrastructure—physical infrastructure as well as human talent, support for basic research, and institutional focus—the private sector must reproduce the underlying capabilities of a well-funded middle-class economy.

Valparaíso, Chile, is an example of a city with recognized historic importance, active international commercial interest, and a need for sustainable development that supports the best expression of today’s local culture and evolving needs. Image: David Vives.

No financial actor—not in the private sector, the public, or the multilateral—is positioned to fully replace the efficiencies built into societies at all levels through effective long-term public policy commitment and ongoing foundational investments. Nor can the ripple effects of cooperative value-building be affordably achieved through the blunt force of a single investor.

So, we recommend public development banks support innovations in data sharing and financial services across sectors to allow for precision tracking of teleconnections, to support climate value, good food finance, and localized capital to communities solutions. To increase the likelihood of discovery of locally relevant, actionable new approaches, we further recommend that micro-scale and small businesses be treated as investable laboratories for discovery of new sustainable and resilience-building approaches.