Commonwealth develops tools to improve climate finance for vulnerable countries

The Commonwealth Secretariat and Cambridge University’s Centre for Resilience and Sustainable Development (CRSD) hosted a collaborative workshop for climate finance experts to examine new tools designed to improve climate finance attractiveness for Commonwealth Small Island Developing States (SIDS).

The launch of phase three of the joint Their Future, Our Action project, a two-year collaboration between the Commonwealth Secretariat and CRSD focuses on enabling small states to attract sustainable finance opportunities for young people and biodiversity, two essential components of achieving sustainable development.

A key challenge to creating sustainable and investable projects in developing markets is the collection and analysis of appropriate data to support investment. To address this gap, the Their Future, Our Action team has developed two new data tools – the ‘Political Economic Resilience Index (PERI)’ and ‘The Cambridge-Commonwealth Sustainable Investment Marker (CSIM)’.

Ahead of the workshop, Commonwealth Secretary-General, the Rt Hon Patricia Scotland KC said: “The Their Future, Our Action project is on track to deliver a new type of sustainable investment model for Small Island Developing States, and those who wish to invest in them. In the wake of the COVID-19 pandemic, and with the constant threat of climate disasters, vulnerable countries are facing high debt levels and debt distress. Today’s workshop will aim to leverage the global expertise of attendees to help operationalise sustainable finance solutions for SIDS, through the design of an institutional mechanism to de-risk investments both for countries and investors.”

Speaking about the development of the new tools, Dr Nazia Mintz Habib FRSA, Founder of CRSD said: “We deployed over twelve systems thinking methodologies to identify actionable outcomes that the Commonwealth Secretariat can realistically offer the governments of Small Island Developing States to attract sustainable finance. At the same time, evidence-based outcomes namely the Political-Economic Resilience Index improves investors’ confidence by de-risking the deal-making process.

“This collaboration with the Commonwealth is a game-changer engagement for us and the event today is part of the rigorous process we are taking to validate our data.

“We are overcoming the disciplinary limitations, institutional conservatism, and traditional understanding of investment processes and diversifying who can leverage existing mechanisms to attract investors to SIDS.”