What makes climate public-private partnerships work, and what derails them most often?

Jim Bailey

CEO of the Americas at Capgemini

For a climate public-private partnership to work, organizations need to make decisions based on data and ensure the partnership is collaborative. Carbon emissions data is vital for companies when gauging their progress on sustainability initiatives, and it’s just as valuable when tracking a larger, broader climate initiative. With accurate visibility into what’s working and what’s not, and clear communication across both sides of the partnership, the public and private sector can course-correct or accelerate as needed. This allows them to stay on the same page when plans change, focus efforts more efficiently, and make the most of their resources rather than working in silos.

What derails a climate public-private partnership most often is the challenge of adjusting to meet new compliance requirements. As these requirements evolve and more countries mandate them, companies may struggle to pivot effectively. Both the public and private sector must be agile and adaptable to keep up with new standards — and can also benefit from accurate emissions data in this instance to make well-informed decisions based on emerging scenarios.

Kareem Yusuf, Ph.D.

Head of IBM Sustainability Software at IBM

In the technology space, there is huge potential for the private sector to put its tools to work for public organizations in the realm of climate change. What makes these partnerships successful is true co-creation from the ground up.

A common pitfall is for the business to simply provide a technology without a real understanding of the public sector or nonprofit partner's objective, or the cultural, regional, or socio-economic factors that could pose barriers to adoption. By working closely with the people who will be using the technology, the partners can figure out how to adapt and apply it in a way that works for this specific community and use case. It requires more than technology — it requires time and two-way dialogue, just like with our enterprise clients. Ultimately, we need to get the right data and insights to these organizations in a way that they can easily understand and take action on. Once that's established, technology can actually be an enabler of better collaboration amongst many organizations.

For example, with IBM's Sustainability Accelerator, we work together with nonprofit and government organizations to expand projects and solutions that help communities vulnerable to environmental threats using IBM sustainability technology and expertise. It’s not just a technology solution; it’s a two-year program that allows for co-creation throughout the process. This type of partner-driven approach offers more scalability, sustainability, and impact than if either party were to singlehandedly undertake this effort.

Lila Preston

Partner and head of growth equity strategy at Generation Investment Management

Public-private partnerships can be catalytic for climate action. Take for example the rise in electric vehicle adoption. Clean city infrastructure for EVs has and will continue to be built off the back of technology innovation, consumer demand, and supportive government policies. We’ve invested in companies like Proterra, an innovator in heavy-duty electric transportation, which partners with cities as a vendor to supply zero-emission battery-electric transit buses and charging infrastructure.

As we outlined this week in our sixth annual Sustainability Trends Report, the geopolitical events of the past year, including the devastating war in Ukraine, have highlighted the urgent threat that fossil-fuel dependency poses to global security, economic well-being, and democracy. We believe legislation like the Inflation Reduction Act can act as a catalyst bringing the public and private sectors together to support and rapidly boost investment in clean-energy industries.

Climate public-private partnerships work best when they encourage realistic goals that are transparent, objectively defined, and shared with key stakeholders. These partnerships must also take into consideration the needs of the community. Such partnerships are most often derailed when incentives across the various parties are not clearly aligned and/or are not appropriately long term in nature. When they are, these partnerships can catalyze private sector funding to truly scale climate action.

Peter Barrett

Co-founder and general partner at Playground Global

A successful climate PPP distributes risks and benefits properly among the partners. I think of the financial arrangement to protect coral reefs in the Yucatán. Mexican regional governments buy a policy from Swiss Re that pays off after storm events and the money goes to repair reefs that bring tourists who support the local economy. Everybody wins.

Where partnerships go wrong is when they pursue bad science. Direct carbon capture, for example, is a profligate waste of energy. We also don’t need elaborate taxpayer-funded collaborations for building utility-scale solar. That’s a fairly well-solved problem.

The PPPs that will work are the ones designed to de-risk specific and fundamental industrial paths to de-carbonization. We need mechanisms that turn into industrial processes that scale into things that really move the needle.

For example, there isn’t enough lithium to keep up with forecast future demand. Fortunately, there's almost an unbounded number of chemistries, such as potassium, that you can build batteries out of. Potassium is everywhere. It can be used for high-capacity and cheap batteries.

I could see PPPs that combine private sector industrial IP (Mercedes has some of it) with government-owned supercomputers and the right algorithms to synthesize potassium at a scale we’ve never seen before. True decarbonization will tap nature’s chemistries to produce industrial results, but this takes the right balance of risk-sharing, patient capital, and deep tech in chemistry, biology, and physics.

Sheryl Telford

Chief sustainability officer at Chemours

We are facing huge, global challenges that require collaboration and partnerships — across industry, academia, value chain, policy arenas, and more — the likes of which we have never seen. No single company or organization can achieve meaningful change alone. We must work together, as a global community, to amplify our impact and find the best solutions to any challenge.

Reaching net zero by 2050 is doable, but is going to require innovation, new technology, and radical partnerships. We must work together to get where we need to go, and the time to act is now.

What makes these partnerships work are several key factors: finding the right experts to achieve shared objectives, being open to new ideas and influence, and not being afraid to tread new waters. An example is an initiative we’re collaborating on called Remove2Reclaim, which brings together diverse organizations across academia and the plastics value chain to create a completely new recycling strategy for end-of-life plastics that could contribute to the circular economy while yielding significant benefits to society and the planet.

On the flip side, a lack of clear objectives and incongruent policies can hinder the development of partnerships. For example, governments around the globe are making strong commitments toward decarbonization, which we expect to see more of at COP 27 later this year. At the same time, governments are proposing restrictions on chemistries that are essential to achieving those commitments and underpin key technologies across hydrogen power, electric vehicles, sustainable thermal management solutions, and more.