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Article Article June 25th, 2024
Cities • Delivery • Finance • Innovation

Climate leaders overcome funding challenges by “hacking” bureaucracy and building resilient coalitions

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Climate leaders struggle to secure funding for initiatives and their organisations. @CPI_foundation's @LidyaStamper & @MathFoged discuss the reasons behind this & ways to overcome this challenge.

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"At @CPI_foundation, we regularly hear how damaging siloed bureaucracy is to climate action. When we break down these siloes, we uncover pathways to cohesive, collective climate action."

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Dive into the last of @LidyaStamper & @MathFoged's climate leadership series, which discusses how climate leaders could overcome funding challenges by “hacking” bureaucracy and building resilient coalitions.

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This blog series, focused on building a new climate leadership paradigm, is part of CPI's Climate Change Initiative. Partnering with local governments across the world, we test new innovative approaches that can accelerate climate action in cities. Our work currently focuses on four opportunity areas that are ripe for disruption: organisational transformation, building legitimacy, systemic climate finance, and information and learning systems.

As we conclude our research on the skills and mindsets needed for effective leadership in climate action, one obvious challenge remains untouched. Funding, especially the lack of funding for climate action, was a central point of consensus for the climate leaders we interviewed.

The funding challenge

Grassroots climate leaders, working at the most local level to mobilise people around climate action, struggle to secure funding for initiatives and their often less established organisations. We can point to several reasons for this. 

First, grant application processes require dedicated staff, time, and resources that many smaller volunteer-based organisations do not have. Second, those with the capacity to apply for funding find application processes hard and complex to navigate. Finally, after securing a grant, many find the reporting and impact measurement obligations difficult to track and quantify. Some organisations are still establishing themselves, while others generally find the traditional methods for monitoring and evaluation do not represent reality. 

Sufficient funding for climate action is also challenging in government and city halls. One of the main challenges for city leaders is that ambitious climate policies are adopted but without funds to implement them. This puts public servants responsible for implementing these plans in tricky positions that force them to think creatively about their remit of influence and relationships across the city hall. As expressed by a previous senior sustainability officer in a city, 

“The job of the sustainability officer is to be "an advocate of others" - not to be the only one responsible for the city's climate action plans. [...] The key is to get in with budgets - that’s where the policy happens.”

Finance staff: Essential drivers for climate action

Budget setting and procurement are fundamental to how cities function and decide their investments. However, these budgets and procurement policies often fail to align with a city’s climate goals. The centrality of staff responsible for budgets and procurement in driving climate action highlights the pervasive nature of climate change challenges. While direct funding for climate initiatives is crucial, another effective strategy is fostering collaboration across departments, making climate action a shared responsibility.

One key example of this integrated approach is the role of procurement and contract conditionalities. Through detailed specifications, finance staff significantly influence a city's capacity to deliver climate solutions via the goods and services they procure. Unfortunately, these staff members are frequently not engaged early enough or lack the knowledge to effectively leverage their roles in climate action.

“There is a leadership void in cities - we haven't spent a lot of time educating those individuals, those who are responsible for finances, budget and procurement.”

Our research shows that successful climate action often stems from climate leaders sharing their ideas and intentions with colleagues. Since decarbonisation and climate initiatives cannot be confined to a single department, climate leaders can demonstrate pioneering leadership by integrating climate considerations into other policies and public initiatives (for example, Durham Council’s approach, as described in our previous blog). Another innovative approach to incorporating climate targets into a city's governance structures and budgeting processes is C40’s Climate Budgeting Programme

At CPI, we regularly hear how damaging siloed bureaucracy is to mainstreaming climate action. When we support departments to break down these siloes, as we are doing in King County, Washington, we uncover pathways to cohesive, collective climate action. 

We can advance climate action through unconventional methods by “hacking” the bureaucracy and harnessing the influence of incidental climate leaders - like those responsible for budgeting and procurement.

What steps can we take collectively? 

At CPI, we are actively engaging in two key initiatives to address these challenges:

International Human Learning Systems Funders Group

Arising from the success of our shared event at UNGA on the Systems Experimentation Fund, CPI, in partnership with Climate-KIC, is creating an international “funders group” for foundations, philanthropists, and governments worldwide. This initiative directly addresses the challenges highlighted by grassroots climate leaders who face difficulties securing funding and navigating the complex application processes. The funders group aims to create a more responsive and adaptive funding environment by changing the power dynamics for financing and prioritising learning. This group will:

  1. Provide a ‘safe space’ for funders to experiment.

  2. Build a collective movement for change.

  3. Explore what Human Learning Systems approaches mean in their organisations and contexts.

  4. Enable funders to design funding experiments differently, including different processes for seeking applications, scoring them, learning across projects, and developing governance/accountability mechanisms.

  5. Enable funders to support one another’s learning by sharing their experimental journeys.

The group is part of a broader Action Learning Community for development practitioners, providing a constituency of interested actors who can inform and shape the experiments and explorations of the funders group. The broader group can also be inspired by and confirm that significant development practice changes align with funders' demands. This initiative reflects the insights from our interviews about the importance of distributed leadership and collaborative learning. If you want to learn more about this opportunity, please contact Gabriel Del Castillo at gabrielc@centreforpublicimpact.org.

Systemic Funding Architecture for Urban Climate Finance

We recognise cities' critical role in society’s transition toward a low-carbon, climate-resilient future. However, many cities struggle to fund their climate action plans. So, CPI partnered with the TransCap Initiative and Climate-KIC to develop research on how a systems-based approach to investment can close the urban climate finance gap. Our proposal, Systemic Funding Architecture (SFA), addresses this challenge by:

  1. Translating city-wide climate action plans into comprehensive climate investment plans.

  2. Building financeable portfolios of projects that reduce complexity for cities.

  3. Partnering with climate finance experts to build city-internal capacity.

The initiative involves several phases: pilot identification, system diagnosis, climate portfolio design, financing architecture development, and capital raising. By centring collective sensemaking and learning, the process will help cities create long-term, multi-pronged climate investment strategies that are impactful and inclusive. This approach aligns with our findings that city finance staff are crucial for driving climate action through budget setting and procurement. They need support and education to fully leverage their roles.

Through these initiatives, CPI is working to transform the approach to climate finance and leadership, ensuring that funding is more accessible, equitable, and effective in driving systemic change. By fostering experimentation, learning, and collaboration environments, we can support leaders and cities in more effectively navigating and addressing the complexities of climate action.

Now what?

Through insightful conversations with leaders across sectors and institutions, it has become increasingly evident that a new leadership paradigm in climate action is needed. We have heard how the complexity of climate change challenges hierarchical management ideals and instead requires a new mindset and skill set of leaders to navigate the interconnectedness of climate change. 

We seek to support leaders in strengthening relationships and building awareness of the interplay between self and the wider system. Only through a distributed approach to leadership centred on trust, psychological safety, learning, and experimentation can we create impactful and adaptive responses to the ever-evolving challenge of climate change.

A new paradigm for climate leadership

As we conclude this blog series, we have journeyed through the essential elements of a transformative climate leadership paradigm. 

In our first blog, we discussed the urgent need for a new leadership model that embraces the fluidity and interconnectedness of the systems we operate within. This emerging paradigm requires leaders to move beyond sector-specific expertise, acknowledging that climate change is deeply embedded in social systems and belief structures.

Building on this, the second blog emphasised the importance of introspection and self-awareness. Effective leaders must understand their role within larger systems and practice reflexivity to navigate the complexities of climate action. This self-awareness enables leaders to empower those impacted by climate-related decisions, fostering inclusive and equitable decision-making processes.

The third blog highlighted the power of storytelling as a tool for inspiring and mobilising communities. By framing climate action in relatable and emotionally resonant terms, leaders can overcome cognitive and normalcy biases, making the global challenge of climate change more tangible and urgent for local audiences.

In the fourth blog, we explored the paradox of the urgency of the climate challenge and the necessity of learning from failure. While immediate action is critical, leaders must also embrace experimentation and iterative learning to develop resilient and adaptable strategies. This balanced approach ensures that our responses to climate change are both effective in the short term and sustainable in the long term.

Through these insights, we have painted a picture of a new climate leadership paradigm that is dynamic, relational, and adaptive. Effective climate leaders cultivate self-awareness, harness the power of storytelling, and embrace the necessity of learning from failures. They understand that leadership is not about holding power but distributing it, fostering collaboration, and building community trust.

As we face the pressing realities of climate change, this new leadership model offers a hopeful path forward. It calls for leaders at all levels—from local governments to grassroots activists—to step into roles that challenge existing systems and introduce innovative, systems-based approaches. By doing so, we can create a more sustainable and resilient future, one that is responsive to our world's complexities and interdependencies.

We invite you to continue this journey with us, exploring how you can embody and promote this new paradigm in your own climate leadership efforts. Whether you are a collaborator, an innovator, or an advocate, your role is crucial in shaping the future of our planet. Together, we can forge a more sustainable and equitable world.

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