Waking up to Climate Risk

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Written by Valentin Jahn and Alvaro Lara (both MSc Climate Change, Management & Finance 2018 graduates) who discuss how, as students, they worked with the Centre for Climate Finance & Investment to create the Climate Investment Challenge. The competition, currently in its second year, was launched in 2019-20, and is now in the capable hands of a new cohort of students who are leading a global initiative to build the next generation of climate leaders. Not a small feat by any means, but you have to start somewhere. So, what better place than Imperial. 

A graduate competition to innovate against climate change

The team - made up of students from several programmes at the Business School - is leading the global expansion of the Climate Investment Challenge. The Challenge is a pitch competition for graduate students to develop creative financial solutions and innovations to tackle climate change. The competition challenges students to think creatively about how the power of finance and business can be used to fight climate change. The Challenge held its first edition last year launching as a competition exclusive to UK students. While we were lucky to be involved in the Challenge since the beginning, we could not have imagined what the competition would become. 

Creating global connections to deal with the global climate challenge

By all measures, the Challenge was very successful in its inaugural year. In its UK-launch, the Challenge attracted 38 climate investment proposals from 14 different universities across the UK, representing nearly 120 Masters-level students. So, when we prepared to hand-off the baton to the incoming student team, the million-dollar question became: what to do with the Challenge this year? The team did not hesitate. They decided to raise the stakes and expand the competition globally. 

The Challenge is a call-to-action to spell out the business case for climate-aligned investing and to devise ways to capitalise on climate opportunities.

In just a few months, the team has created a global network of university ambassadors championing the Climate Investment Challenge on the ground: with ambassadors in France, Portugal, the US, Canada, Kenya, and China. The team has also directly engaged with universities in Spain, Germany, Austria, Israel, the UAE, Hong Kong, South Korea, Singapore, Indonesia, Australia and Mexico, to name a few. 

Ideas that can develop into real-world financial instruments

While the footprint of the Challenge is now global, the message to graduate students remains the same. The Challenge is a call-to-action to spell out the business case for climate-aligned investing and to devise ways to capitalise on climate opportunities. For students, this is an opportunity to apply state-of-the-art financial innovations to disrupt the industry and to explore new ways to mobilise private capital into climate investments. The Challenge is not only a chance to expose students to the climate challenge, but also to connect them with experienced industry practitioners in climate finance; among those, the competition’s industry sponsors: Standard Chartered, Quinbrook Infrastructure, and Candriam.

We want the Challenge to be a catalyst for much needed innovation in the climate finance space. Ultimately, we want to see students becoming decision-makers at the companies they go and work for. We want to see their ideas evolve and develop into real-world financial instruments.
Rafael Alonso
MSc Climate Change, Management and Finance student, 2020-21 and Chair of the Climate Investment Challenge
Rafael Alonso, MSc Climate Change, Management and Finance 2020-21

Innovative financial ideas addressing challenges across all sectors 

In the past, the Challenge has attracted financial solutions targeting sectors with an urgent need for innovation – among those; agriculture, forestry, electric mobility, and infrastructure – and across a wide range of financial products – from specialised bonds and funding vehicles, to micro-credit schemes and risk-mitigation insurance products. Since the deadline to participate in the Challenge is not until late-February 2021, we won’t know what financial innovations will be submitted this year for some time. What we do know is that we will be absolutely impressed by the quality and creativeness of students participating. After all, they will be the next generation of climate leaders.

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