SIRI Hosts Discussions on Blended Finance with World Leaders During NYC Climate Week

SIPA’s Sustainable Investing Research Initiative (SIRI) convened global leaders and scholars at Columbia University on September 24–25, during this year’s UN General Assembly (UNGA) and NYC Climate Week. SIRI’s Blended Finance Decisionmakers Roundtable Discussion focused on India and was followed by the Inaugural SIRI Blended Finance Conference . These events are an integral part of SIRI’s broader Blended Finance effort—launched in partnership with Mirova, the Systems Impact Multi-Family Office (SIMFO), and Origination—to foster scholarship, education and dialogue on blended finance (see the press release). The Inaugural SIRI Blended Finance Roundtable Discussion was held earlier this year in April 2024.

The world faces a large financing gap, especially in the Global South, to finance the mitigation of climate change, biodiversity loss, poverty, and other grand societal challenges. This raises a critical question and defines the focus of SIRI’s Blended Finance efforts: How can we work together to address these challenges in service of future generations and crowd in more private capital help to finance innovative solutions in climate tech, renewable energy, nature-based solutions, social inclusion, and others, especially in the Global South?

To better understand the challenges and opportunities in mobilizing more private capital investments, SIRI brought together key leaders from the public and private sectors, policymakers, and academia, including representatives from the ministries of finance or economy, the United Nations (UN), the World Bank Group, Development Finance Institutions (DFIs), philanthropies, corporate leaders, leading investment managers and asset owners, VC investors, rating agencies, and others—all of whom play a vital role in advancing blended finance.

This year’s roundtable discussion on September 24 focused on whether and how blended finance can help foster sustainable economic, environmental, and social development in India. Caroline Flammer, the founding director of SIRI, and Merit Janow, SIPA’s Dean Emerita, gave opening remarks. Keynote speaker Anjali Bansal, SIPA alumna and founding partner of the Avaana Climate and Sustainability Fund, described India’s ongoing digital transformation and highlighted how blended finance and technological innovation are critical to achieving sustainability goals. Her insights set the stage for additional speakers and engaging conversations on key issues, including:

• Urbanization: How can blended finance help India finance the development of inclusive and sustainable cities?
• Transition of hard-to-abate sectors: How can India finance the decarbonization of its steel, cement, and transport industries?
• Renewable and affordable energy: How can India mobilize more capital to increase renewable energy capacity and improve access to affordable energy?
• Sustainable agriculture: How can India crowd in more private capital to finance innovative climate tech and nature-based solutions to adapt to and mitigate climate change and ensure food security?
• Clean water and sanitation: How can India finance improved access to safe drinking water and sanitation for all?

Addressing these issues is essential for India's sustainable development. These lively discussions yielded several takeaways, including on the importance of capacity building at the local government level, and the replicability and scalability of blended finance deals.

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The following day, the Inaugural SIRI Blended Finance Conference gathered over 150 leaders and experts from across academia, the public and private sectors for a full day of interactive programming. Caroline Flammer moderated the opening panel, in which Susan Lund (IFC), Pradeep Kurukulasuriya (UNCDF), Luciana Antonini Ribeiro (eB Capital), Amy Hepburn (Investor Leadership Network), Marc-Andre Blanchard (CDPQ), and Gautier Quéru (Mirova) spoke to key challenges high-risk markets face and discussed blended finance as a potential solution. The panelists also outlined common bottlenecks that need to be overcome for scaling up blended finance, pointing to three major areas of investor concern: scalable projects, financial risks, and lack of understanding, collaboration, and effective communication among stakeholders.

This opening panel galvanized candid conversations in a number of parallel workstream discussions that followed throughout the day on topics such as the role of Multilateral Development Banks (MDBs), their fiduciaries, and rating agencies; the assessment and mitigation of risks; strategies for developing a pipeline of investable projects; impact measurement and transparency; carbon credits; additionality, capital efficiency, and degree of concessionality; how MDBs and DFIs can provide more catalytic capital; and how to induce institutional asset owners/managers to increase their engagements in blended finance and investments in the Global South.

The conference brought to light critical elements needed to overcome barriers in blended finance—such as the need for increased dialogue and collaborations between the different players, improved transparency, data, and research, and education to foster greater understanding, collaboration, and effectiveness. The in-depth exchange of ideas and experiences over both days were instrumental in fostering connections among key leaders across sectors and in advancing efforts to tackle complex global challenges. SIRI is compiling a summary report to capture the key insights from these discussions for future application and impact.

“While blended finance holds the promise of being catalytic in mobilizing vast amounts of private capital, it is still in its infancy and not well understood,” said Flammer. “Academia has an important role to play in advancing dialogue, research, and education in blended finance. This is precisely where SIRI and SIPA come in.”

To learn more about SIRI’s various activities and potential opportunities to collaborate with SIRI, please contact Caroline Flammer at [email protected].