London, UK – January 2023 – Anne Foster, Global Head of ESG, interview with Shachi Wadhawan and Ned Hillsborough – Industry Relations Leaders – Imperial’s Climate Investment Challenge.
Q: Tell us a little about the Climate Investment Challenge. What does it hope to achieve?
A: Sure! The Climate Investment Challenge calls on postgraduate students to develop and describe a solution that addresses a specific problem on the defining challenge of our time – climate change. The IPCC report has showed us the scale of the challenge, estimating that the investment required to remain within the 1.5°C to 2°C scenario should be between $1.6 to $3.8 trillion per year. Mobilizing finance into the highest impact projects to reverse biodiversity loss, restore nature, and adapt to climate change is a mammoth task for industry… but we believe postgraduate students can play an instrumental role in devising and pitching innovative solutions to investors, so that climate finance is deployed where it is needed the most. At the very least, this challenge is a way to bring together academics and industry to talk about some of the most pressing challenges we face today, whilst also granting the opportunity for student-led ideas to scale-up into viable businesses.
Q: What has been the reach and scale of the competition and how do you extend support to the students?
A: This is the fourth year of the competition, and we are building on the successes of our previous edition which concluded in the summer of 2022. We received 100+ finance-based proposals from 369 students participating across 21 countries. Six ideas made it to the final round, with a main prize (£10k), runner-up (£5k), and a special prize for an idea relevant to the emerging markets (£7.5k). Throughout the competition, students received support from Imperial’s start-up incubators through webinars on creating a winning idea, preparing a pitch, and invaluable assistance from our 3 lead sponsors – CANDRIAM, Standard Chartered, and Quinbrook. The grand finale was held at the Royal Institution, attracting wide attendance from the industry and the event was adjudicated by a panel of climate finance experts.
Q: Could you give us some examples of the winning ideas in the past?
A: Our winning prize last year went to “SustainAcre”, which aims to scale up regenerative orchard management in the UK, restore biodiversity and climate stability, while offering investors exposure to a nascent and unique asset class. The other ideas that made it to the finals round last year were the “Phoenix Fund” to provide blended finance insurance for wildlife resilience and “Ocean Nation Capital” blue bonds targeted at bioremediation of marine life. One of our 2022 finalists, “Resolut”, a central platform to encourage shareholder activism, is currently at the prototype phase and due to launch as a business in May 2023. In 2021, we received proposals including a REIT to fund solar power and agriculture in Northwestern China and a scheme to streamline farming revenue streams in Indonesia. As you can see, these financial solutions are hugely varied, spanning across both nature and climate-related physical and transition risks.
Q: What is your vision for the 2023 edition of the CIC?
A: We have got lots of very exciting announcements for the competition for 2023! Firstly, we have spoken to several of Quinbrook’s and other external ESG experts to come up with a list of “problem statements” that relate to real world climate issues faced by industry today. These will be shared in our university outreach phase, so any students that would like to get involved with the challenge, but do not necessarily have a specific climate issue, can then create a proposal targeting one of the problem statements. This will help to make all the proposals within the challenge as relevant as possible and targeting the most pressing and difficult climate issues.
In terms of the prizes…we will be keeping our emerging markets prize this year and we are looking to significantly increase applications from emerging markets regions with more targeted university outreach. Additionally, in the past, CIC attracted ideas that potentially required either large scale investments or those that fell in the realm of venture capital investing. We have therefore created two new prizes: firstly, a prize for “Financial Disruption”, as we recognize that postgraduates are well placed to come up with business ideas with disruptive potential in the climate finance space, if proven right. And secondly, recognizing the power that geospatial and satellite data can have in directing financial decision making, we have a new prize sponsored by the CGFI. We are organizing post-competition support for our prize winners, so the best ideas get coaching from industry experts at the implementation phase and the opportunity to network with other relevant institutional investors after the competition ends.
There will be plenty of opportunities to hear more about the Challenge and Quinbrook to come along to our final at the Royal Institution on 9 June 2023 – so please stay tuned for more updates!