A First for African Philanthropy – Southern Africa’s Funder Climate Commitment

By Dimitri Selibas, Independent Climate and Development Consultant

“The Global South needs a climate justice approach that balances development and climate action…” – Dimitri Selibas

A first-in Africa initiative

Private independent funders have a unique opportunity to be part of a pioneering initiative in Africa by joining the South African Funders Climate Commitment. This pledge, the first of its kind on the continent, is being co-created by a diverse task team of IPASA members. Set to launch by the end of 2024, it will mark a major milestone in IPASA’s climate philanthropy efforts.

Since 2021, IPASA has developed and implemented initiatives to assist its members and other funders in South Africa to better understand the climate crisis and its effect on philanthropy and facilitated and supported these funders in taking climate action.

As the world faces an interconnected “polycrisis”—where social, political, economic, and environmental crises overlap and intensify—there is a greater need for more collaborative and systematic responses. The South African climate pledge places IPASA and its members at the forefront of international climate action, helping them protect their investments while fostering innovation and creating a more equitable future.

South Africa’s climate change reality

In recent years, South Africa has faced arguably some of its most extreme weather events—floods in KwaZulu-Natal, wildfires in Eastern Cape, and droughts threatening Cape Town with “Day Zero”. Climate change is already wreaking havoc on communities, damaging livelihoods, infrastructure, and the surrounding environment. A comment from a member of the IPASA Climate Commitment Task Team highlights the growing awareness among funders: “We work primarily in education and initially did not consider climate change a priority. After conducting fieldwork in Durban, where schools were impacted by climate issues (major flooding), we realised the importance of this intersection.“

The World Bank warns that these conditions are expected to become more frequent and severe as the country warms at twice the global rate. This also means that aridity and drought risks are likely to increase by 39% by the 2050s, along with a greater probability of extreme storms and other climate-related hazards, especially near the Indian Ocean.

These conditions put added pressure on South Africa’s fight against poverty and inequality, as vulnerable households, women, children, and the elderly will be hardest hit. Additionally, disadvantaged households will be disproportionately affected as they are more exposed to pollution, extreme weather events, and have less access to quality public health services and financial resources to cope with damages.

Additionally, aging coal-fired power plants and weakened state institutions have resulted in an unreliable and costly power system. According to the World Bank, South Africa is the leading carbon emitter per GDP worldwide. Without transitioning to a low-carbon economy, South Africa risks further economic decline as global efforts to cut emissions lead to carbon taxes on high-emitting industries. The impact on communities, foundation investments, and endowments will be significant.

Philanthropy’s climate responses

A sense of overwhelm is a natural response to these challenges. And indeed, a major finding of the landscape and scoping report that I researched and wrote for IPASA was that stakeholders are feeling overwhelmed by climate change. This research involved close to 20 interviews with climate and non-climate funders, governmental initiatives, and independent experts in South Africa, as well as international philanthropic bodies. The aim was to gain a better understanding of the realities, challenges and aspirations of climate funders and other stakeholders in South Africa, and how that relates to the experiences of stakeholders who have been involved in the development of climate pledges elsewhere. 

Another key finding from my report was that national and regional philanthropic organisations, such as IPASA in South Africa and the Group of Institutes, Foundations, and Enterprises (GIFE) in Brazil, are playing an increasingly important leadership role in coordinating climate action among their members. They are providing thought leadership and are driving collaborative solutions that not only foster innovation but also protect foundation’s investments – all while working towards a more equitable future, which is especially crucial in the Global South.

The launch of the Worldwide Initiatives for Grantmaker Support (WINGS) International Philanthropy Commitment on Climate Change (International Commitment) in 2021 provided independent funders with a roadmap to integrate climate action into their work without shifting their core mission. This initiative forms part of growing philanthropic support for climate action since the formation of the United Nations (UN) Framework Convention on Climate Change in 1992 and accelerating with the Paris Agreement in 2015. By 2020, Jeff Bezos announced the Bezos Earth Fund, pledging US$10 billion to combat climate change and the philanthropically-funded advisory services like the Climate Leadership Initiative have supported over 60 families and philanthropists new to climate action, helping them contribute more than US$3 billion to climate solutions in recent years.

Climate change affects all development goals

This speaks to another key finding from the scoping report which was how climate change is often misunderstood as solely an environmental issue, ignoring its impact on sectors like education and Early Childhood Development (ECD). This misconception is widespread in South Africa, as well as other countries with pledges like Brazil and Canada. 

The International Commitment recognises that all independent funding efforts—whether in health, education, social justice, or any other field—are affected by climate change, and that addressing this issue is crucial to achieving their goals. As of 2024, 799 foundations had signed the International Commitment and seven national foundations had created country-specific pledges, including Canada, Spain, France, Italy, UK, Poland and Brazil. South Africa, through IPASA, and the Arab Foundations Forum are in the process of completing their national commitments and joining this international cohort.

In recent years, as little as 2% of philanthropic funding was directed towards climate issues. Africa, the most vulnerable continent to climate change, receives less than 3% of that amount. The World Bank estimates that South Africa will require incremental funding of R8.5 trillion (about 4.4 percent of GDP) per year until 2050 to implement a Just Energy Transition (JET) – a process of transitioning from fossil fuels to renewable energy in a way that is socially and economically fair. To make any attempt at reaching the target, development aid, public sector financing, commercial investors, and independent funders will all need to each play to their strengths. Climate pledges —by promoting collective action, coordination, and collaboration—can also play a unique role.

Filling the funding gap

The Just Energy Transition Partnership (JETP)—a multilateral collaboration including France, Germany, the European Union (EU), United Kingdom (UK), and the United States of America (USA)—has pledged US$ 11.9 billion to South Africa, in the form of grants, concessional loans, and commercial debt and equity. This has facilitated the establishment of South Africa’s Just Energy Transition Investment Plan (JET-IP), which will also launch a funding platform in October 2024 to match suppliers of grant funding (development banks, corporations, and private independent funders) with potential JET beneficiaries (SMMEs, CBOs, NPOs, trade unions, and government institutions). The platform aims to match five projects, amounting to R100 million this year, and by 2026, it aims to have 25 projects or programmes matched, totalling R2.5 billion.

International examples already illustrate how independent funders can play a key role in fostering innovation, supporting grassroots movements, and filling gaps in public funding. A USA-based just transition fund (which includes Bloomberg Philanthropies, Google.org, and The MacArthur Foundation) demonstrates how philanthropy enabled community-based groups to leverage US$342 million in public and private funding through US$12 million in just transition grant investments.

The Global South rallying call

The realities of the USA and other Global North countries, however, differ starkly from South Africa and the Global South in terms of economic capacity, historical responsibility for emissions, and climate vulnerability.

While the Global North focuses on decarbonisation with greater access to resources, the Global South faces ongoing critical socio-economic challenges like poverty and inequality, which are exacerbated by climate change. This creates a need for a climate justice approach that balances development and climate action, with the Global South requiring financial and technical support to implement sustainable solutions.

In 2023, Brazil, represented by GIFE, signed into being its funder climate commitment, making it the first country in the Global South to develop a climate funder pledge. The country’s process included capacity-building efforts linked to UN climate conferences and positioning philanthropy leaders in strategic spaces, additionally, engaging with climate issues alongside their non-climate agendas, such as education and employment, and building buy-in from board directors before launching the country’s pledge.

By uniting more funders at international climate events and supporting interconnected climate issues at the national level, independent funders in the Global South can strengthen their collective voice in climate discussions. This collaboration with the Global North allows them to co-create climate solutions and access additional funding to address interconnected socio-economic challenges.