- Rapidly decarbonising our cities will be key to avoiding the catastrophic effects of climate change
- A city business climate alliance offers a solution to accelerate climate action in our cities and open up new opportunities for innovation and economic growth
The growth of global cities in the past few decades has been unprecedented. There are now 34 cities that meet the definition of a ‘megacity’ with a population of over 10 million. That number will most probably grow significantly in the coming decades.
Cities already account for more than 70% of global emissions. It's clear that we need to act now before the task of reversing climate change becomes too difficult. To ensure our cities can continue to achieve economic growth. But to grow sustainably, we’ll need to take advantage of all the solutions at our disposal.
We discussed one of those solutions in a recent article, Stronger together: How cross-city collaboration benefits climate action, which details the advantages of cities working together on climate action. This article will look at the climate action collaboration from a different angle; discussing the importance of cities and local businesses working together towards climate goals.
What is a city-business alliance for climate action?
A city-business climate alliance is a strategic partnership between city governments and the private sector to drive climate action. Collaborating on climate action in this way creates opportunities for both actors. And it has the potential for a much greater environmental impact than if the parties were to work independently.
Alliances can range from a single city working with a handful of companies to multinational partnerships between global cities, businesses, universities, and research institutions.
Why is collaboration between cities and businesses important?
Tackling climate change is an enormous task. Cities or companies working alone won’t solve the climate crisis. In the past, public-private partnerships (PPP’s) have been used effectively to finance and construct massive public interest infrastructure projects such as motorways, hospitals, and schools. To scale climate action in cities, we need to take a similar approach.
This will involve raising large amounts of funding to finance new energy infrastructure, low carbon vehicle infrastructure and building retrofits, as examples. With governments already cash-strapped and city revenues compounded by the COVID-19 crisis, the majority of this funding will need to come from the private sector.
Climate alliances can also serve to accelerate effective climate action. For example, cities may want to vastly increase housing retrofits. If a city-business collaboration is set up – the rollout can be much more streamlined – as the city will already have engagement from private funders, interested businesses, suppliers, installers, and other potential partners.
Time is not on our side and anything that can speed up the deployment of climate solutions will be a huge benefit.
How can businesses benefit from a city-business alliance?
Businesses can benefit from a city-business alliance in five important ways.
- Improve city for business – Local businesses stand to benefit from making their city a more business-friendly environment. A business-friendly city will attract new companies, innovation, and investment – that will impact positively on existing local companies.
- Collaborate and connect with other businesses – Partnerships between cities and the private sector will likely involve multiple companies. This gives local businesses an opportunity to work and collaborate with other like-minded local enterprises, in a variety of ways. If a solid working relationship is formed, businesses may see the benefit of partnering on other ventures outside the climate alliance.
- Company representation – Local businesses can sometimes experience negative impact from new policy decisions taken by city officials. By participating in a city-business partnership, a business can be proactively involved in future policy decisions and make their views and objections heard with regard to changes.
- Attracting talented workers – City governments ultimately want to create clean, healthy, and livable urban environments for their citizens. Cities that offer a high quality of life will attract high-quality workers. This is a strong incentive for local businesses to help city governments to improve their city and make it more livable. In addition, research suggests that talent is more and more motivated to work for sustainable companies, and even accept a pay cut to work for the right company. A business that actively participates in a climate alliance sends out a strong message to potential future employees.
- Innovation opportunities – Cities can become innovation playgrounds for businesses interested in testing out new technologies or processes. With involvement in a city-business climate alliance, businesses could be offered opportunities to test out climate solutions, new technologies, or different ways of doing things.
What frameworks help to support collaboration?
Support for city-business climate alliances is growing and this has led to the development of frameworks to support collaboration.
One of the most well-known frameworks has been established through an initiative led by CDP, WBCSD, and C40. The City-Business Climate Alliance (CBCA) model supports the development of city-business partnership through two actions:
- Supporting the implementation of local city-business partnerships
- Convening global networks of cities and businesses to share expertise and learnings
Examples of city-business alliances in Europe
Climate alliances are forming all over Europe. These four have caught our attention!
Helsinki – The Smart and Clean Foundation consists of 29 public-private partners based in the Helsinki metropolitan area. The partnership includes businesses, universities, and state actors. One of their flagship projects, Closed Plastic Circle, brings together municipal governments with large companies such as Siemens and Fortum to innovate in the area of plastics recycling.
Matosinhos – The Portuguese coastal city of Matosinhos is a great example of a municipality working in partnership with public and private entities to test innovations. The ‘Living Lab’ project aims to create a futuristic low-carbon smart neighbourhood. The partnerships include the Municipality of Matosinhos, CEiiA (Centre of Engineering and Product Development), Porto Polytechnic, Metro do Porto, Efacec, among others.
Antwerp – In 2017, the city of Antwerp launched Climate Active Together (Samen Klimaatactief). This smart city partnership focuses on reducing GHG emissions in the tertiary sector – office buildings, retail, food service, small industry etc. The project brings together local business partners that offer solutions to decarbonise these areas. As an example, the city has partnered with several logistics and transport providers to create multiple sustainable delivery solutions.
Paris – As part of the cities climate action plan, the Paris Action Climate Charter was developed for companies and organisations. The charter sets out primary goals to be post-carbon and 100% renewable by 2050. In addition, the charter encourages ‘win-win’ partnerships between the city and Parisian companies to drive down emissions.
How can I set up a city-business collaboration?
There are four main steps to take before setting up an alliance.
1. Assess your climate goals and identify potential partners
- Review climate action goals and identify barriers to achieving those goals
- Cities should assess if private partnerships could help them to achieve those goals
- Businesses should assess what contribution they could make to city partnerships and potential long-term benefits to the company
2. Engage potential partners
- Research and identify potential partners - local businesses, financiers, universities etc.
- Communicate the objective of the alliance with potential partners and obtain high-level buy-in
3. Form your partnership
- Set out the working terms of the alliance and the commitment levels required
- Secure any financing or resources needed to maintain the partnership
- Establish goals and targets for the partnership
4. Create and active your partnership plan
- Take action towards achieving the goals with alliance partners
- Inform public and policymakers of the climate alliances intentions
- Regularly iterate the objectives and goals of the partnership
How can Futureproofed help?
At Futureproofed, we work with some of the most forward-thinking cities and businesses. Using our network, we can help to connect cities with private sector partners to help accelerate climate action.
If you would like to know more about city-business alliances, or our other services like carbon footprinting or life cycle analysis, please get in touch with Stephanie Van Breedam.
Sander is Futureproofed's resident marketing wizard. His goal is to get the word out about our expertise in helping cities and companies become future-proofed. When he's not deep-diving in data and strategy you can usually find him on his bike, in the kitchen, or playing video games.
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