Brokering New Partnerships & Stimulating Private Sector Engagement for Resilience
Resilient Cities 2018 – ICLEI Global
Brokering New Partnerships & Stimulating Private Sector Engagement for Resilience
Brokering New Partnerships & Stimulating Private Sector Engagement for Resilience is published as part of the Resilient Cities 2018 – The Global Forum on Urban Resilience series and contains a summary with key messages from experts from science – Caroline Schaer (UNEP DTU Partnership; Technical University of Denmark) and Peter van der Keur (Geological Survey of Denmark and Greenland), politics – Ernest Arthur (Metropolitan Chief Executive, Cape Coast, Ghana) and practice – Risa P. Goldstein (Goldstein Partnership Architects & Planners), Alexander D’Hooghe (Org. for Permanent Modernity, Boston, USA) on identifying and unveiling the dormant potential of private sector Micro, Small and Medium Sized Enterprises’ (MSMEs) climate change adaptation gap and implementing Nature-based Solutions (NBS) as a Disaster Resilience Enhancement (DRE) tool with benefits for multiple sectors.
MSMEs’ Resilience Potential
More than 90% of businesses in the Global South are classified as Micro, Small and Medium Sized Enterprises (MSMEs), forming the economic backbone – employment generation and supporting livelihoods. Having adapted insufficiently to changes in the global climate and increased exposure to climate hazards, their core operations (incl. physical goods and assets), value chain and broader network become increasingly vulnerable to and left unprotected against direct and indirect effects of climate change. Due to their regional significance, the whole local value chain is endangered. The adaptation gap of MSMEs, however, also represents untapped potential for increasing resilience.
Impact & Barriers
Due to the informal character of organization and operation, MSMEs, their location, and the magnitude and timing of risks and impact are difficult to map and target with resilience enhancing measures. Lack of awareness and long-term vision, deficient technical and financial capacities, and limited access to affordable financial products (e.g. insurance and loans) lead to a predominantly short-term reactive approach to effects of climate change.
Short-sighted, locally designed, uncoordinated, stand-alone ad hoc efforts may avert immediate individual negative effects, but with higher costs for others, borne by the whole society. Results can be fatal: loss of properties and livelihoods, and disruption of economic and social activities.
Triggers for MSMEs’ Adaptation Action
From a recovery and protection standpoint, vulnerability of MSMEs needs to be assessed by context specific tools tailored to MSMEs, building on an open democratized climate data approach, key areas with the highest ROI identified and attractive climate change adaptation business opportunities provided. Demonstrating and scaling up the business case for adaptation and providing tailored financial support mechanisms, that are also accessible and implementable by private entities, can contribute to the development of local adaptation capacity while realizing new business objectives.
Since the Global North also increasingly experiences shocks to urban areas due to exacerbated climate hazards, the need for climate robust infrastructure as a Disaster Risk Reduction (DRR) means is growing. In this context, in Copenhagen, Denmark an economic analysis quantified in monetary terms the value of Nature-based Solutions (NBS) as a Disaster Resilience Enhancement (DRE) measurement for reducing water related risks within a multi-stakeholder framework, including the municipality, water board, water utility department and private sector. Demonstrating the insurance value of ecosystems for the private and public sector, coined Natural Assurance Scheme (NAS), and subsequently building a business model around that, e.g. by framing resilience as an additional element of corporate risks management, could attract public and private investments into Green and Blue NBS, e.g. by the private real estate development sector.
Also, both softer approaches such as awareness creation and harder ones such as enforcement by policies, e.g. requesting business continuity plans as a precondition for cover by multilateral climate funds, as an example from the Global South, can likewise be means to create a sense of community and taking stewardship, and encourage collaboration between stakeholders and avoid maladaptation – “caring for each other; working together”.
Benefits
Newly emerging public-private-partnerships could indeed be a means for upscaling and replication of context specific climate change adaptation and resilience enhancing approaches while also bringing about significant benefits for other sectors.
Well-directed utilization of pluvial flooding and green areas within infill projects to mitigate heat island effects and reduce green gas levels, as an example from Lodz, Poland for implementing to the local environment tailored NBS and mixed Grey-Green infrastructure systems for increasing resilience, had positive effects for other sectors, including public health and environmental protection/ nature conservation.
A program combining awareness creation in schools, communities and markets, and enforcing prosecution of vendors selling in public places without having a waste bin, the “Wrap your waste, own a Dustbin” project from the Gold Coast, Ghana, improved sanitary conditions, boosted tourism and investments, encouraged a more sustainable behavior and reduced cleanup costs.
However, at times, the intervention with the highest resilience enhancing ROI can be giving up land and current business endeavors and diverting future ones. Examples doesn’t necessarily have to be drawn from the Global South and small Pacific island nations, MSMEs located in areas prone to ocean flooding in New Jersey, USA or inhabitants of Isle de Jean Charles in Louisiana, USA are also compelling case reports.
Closing the Gap
A multi-stakeholder approach positioning investment in infrastructural, business policy and educational natural capital protection, enhancement and restoration measurements as economic profitable for a diverse set of stakeholders from the public and private sector as well as municipalities, could increase identifying and pursuing to close MSMEs’ climate change adaptation gap, in order to accordingly capture effects and co-benefits of MSMEs’ involvement into DRD and DRE measurements that are missed out by current policies.
- UNEP DTU Partnership “Perspective Series”
- EU Horizon 2020 project “NAID: Nature Insurance Value Assessment & Demonstration”
- Naidad, Nature Based Solutions, Nature Insurance value
- Commission for Conciliation, Mediation and Arbitration (CCMA), South Africa
All images used in this post and all other posts within the Resilient Cities 2018 – The Global Forum on Urban Resilience series are property of ICLEI.
