Climate Adaptation Innovation and Learning

Where adaptation investment reaches the market, returns are strong: every dollar invested is estimated to yield more than ten dollars in benefits. Yet tracked private adaptation finance sits at just US$4 to 9 billion a year, one to three per cent of what developing countries need. Closing that gap depends on adaptation businesses in emerging markets growing into investable ventures. It also depends on the incubators, accelerators and funders around them giving the right support at the right time.

These resources were developed under the Climate Adaptation Innovation and Learning (CAIL) project, financed by the Global Environment Facility and implemented by UNIDO, in partnership with Climate KIC, the Global Adaptation and Resilience Investment Working Group (GARI) and UNEP FI.

The White Paper

The white paper asks how incubators, accelerators and wider support ecosystems can better serve adaptation innovators in emerging markets, LDCs and SIDS. Drawing on three years of the Community of Practice on MSME Incubation and Acceleration and 18 in depth interviews, it finds that support is too often designed around donor targets rather than the businesses it serves. With four case studies from India, Tanzania, Uganda and Argentina, it closes with critical insights for entrepreneurship support organisations in three areas:

Tailoring support to each business’s type and stage of growth
Building adaptation specific needs into programme design
Addressing the structural inequalities that shape who gets funded

The white paper was coauthored with PlanAdapt.

[Download White Paper]

Policy Brief

Designing for Fit at the Intermediary Level: Policy and Insight Brief on Adaptation SME Support is addressed to programme builders and incentive creators, such as GEF implementing agencies, and to entrepreneurship support organisations at local, national and regional level. It sets out priority actions in three areas:

Toward SMEs: design from the enterprise, not the mandate, starting from where a business is trying to go and building its readiness to absorb capital.
Toward research and knowledge: fund the infrastructure adaptation depends on, from structured pathways to R&D to local verification capacity.
Toward financial architecture: treat capital and organisational structure as design variables, and build the financial vehicle alongside the technical support.

[Download Policy Brief]

Related resources

The white paper sits alongside the two other CAIL Community of Practice publications: Closing the Investability Gap by GARI, and Lost in Translation: Unlocking adaptation finance through better information flows by UNEP FI.