What is Colibri aiming to achieve?
- Colibri is a catalytic capital facility designed to unlock the land use sector’s potential to achieve the 37% reduction of emissions reductions required by 2030
- Colibri aims to do this by catalyzing capital for natural climate solutions and sustainable and inclusive economic growth at scale
- Colibri will help build natural climate solutions as an investment class
How will Colibri achieve its goal?
- Investing in natural climate solutions and sustainable and inclusive economic growth is considered high risk, particularly in emerging markets – Colibri will catalyze capital by taking anchor, patient and first-loss capital positions in investment intermediaries investing in ODA-eligible countries, enabling them to attract more risk averse capital and build a track record
- Capital will be deployed following thorough impact, ESG and financial due diligence (and where required, technical assistance and capacity strengthening) to attract other investors
- Colibri will use its leverage and in-house expertise to help investees develop and implement robust impact, ESG and financial management systems that ensure sustainable, inclusive and equitable economic outcomes
- Colibri will enable a knowledge-sharing community to increase awareness of opportunities to invest in natural climate solutions and promote best-in-class impact and ESG management
What will Colibri invest in?
- Colibri will invest in investment intermediaries targeting sustainable forest management, regenerative agriculture, and conservation and restoration of ecosystems.
- The pipeline of the intermediary vehicles include:
- Reforestation for timber and carbon, longer harvest cycles for timber
- Regenerative agricultural practices – such as pollination services, water and soil conservation practices, biodiverse systems, etc.
- Transition of agricultural production systems towards agroforestry, increasing their resilience to climate and diversifying and increasing their revenue streams with timber, carbon, honey, etc.
- Commercialization of sustainably produced non-timber forest products
- Restoration of ecosystems, ecotourism
- Mangrove restoration combined with sustainable aquaculture
Why is Colibri targeting investment intermediaries (also referred to as investment fund managers or investment vehicles)?
- Investment intermediaries link institutional and other investors to natural climate solutions (NCS) – for example, a pension fund does not have expertise investing in NCS and typically looks for bigger ticket investments than individual NCS assets can absorb, so they rely on investment intermediaries to deploy their capital into the sector
- Investing in intermediary vehicles is an efficient way to build NCS as an investment class – NCS is a much needed, yet nascent investment class, and intermediary fund managers typically have the knowledge and expertise to structure deals with the required financial and impact returns for both investors and the communities
- These intermediaries struggle to mobilize the funding needed to realize their ambitions because (a) they are often first-time fund managers; (b) investors perceive NCS as high risk; and (c) the ticket sizes they are looking for are often too small for private investors
- Pooling such intermediaries and their individual assets enables private investors to allocate relatively large ticket sizes and diversifies the investment portfolio thereby reducing risk
What is Colibri’s ESG/Impact focus?
- Impact and ESG drive Colibri’s success and are at the core of our investment policy and processes
- Colibri will finance activities that contribute to global climate and biodiversity goals, create tangible benefits for local communities, promote gender equality and the empowerment of women and align with internationally recognized environmental, social and human rights standards and comply with national environmental and social legislation
How will Colibri manage Impact and ESG?
- Adopt and implement a system of policies, processes and practices, aligned with the Operating Principles for Impact Management and the requirements of IFC Performance Standard 1 (Assessment and Management of Environmental and Social Risks)
- Assign management system accountability at senior executive level and ensure an in-house team and resources are in place to implement and maintain the system
- Report portfolio impact on climate, biodiversity and ecosystems, local communities and gender, based on internationally recognized KPIs, e.g. IRIS Metrics, the UNEP Land Use Finance Impact Hub Metrics, and where possible pursue third party verification
- Require all the above from the intermediary vehicles that we finance
- Make available capacity development expertise and funds to strengthen investee impact and ESG expertise where needed, in addition to debt and equity
What is Colibri’s approach to local communities and indigenous peoples?
Colibri will only support natural climate solutions that are fair and inclusive to everyone concerned. Wherever relevant, investees are required to:
- Create tangible benefits for local communities in the form of livelihood support, food and water security, reduced disaster risk and benefit sharing
- Design and implement a stakeholder engagement process and grievance mechanism in line with IFC PS 1 and the UNGPs
- Avoid land acquisition leading to involuntary resettlement (i.e., resettlement where affected persons or communities do not have the right to refuse land acquisition or restrictions on land use that result in physical or economic displacement)
- Obtain and demonstrate informed consent from local persons or communities where their land is brought into the project
- Obtain and demonstrate Free Prior and Informed Consent (FPIC) from Indigenous Peoples where projects impact land they traditionally own or have under customary use, their access to natural resources and/or commercialize their knowledge or practices, in line with IFC PS 7 or where otherwise required by internationally recognized certification schemes
What impacts will Colibri achieve and how will they be measured?
- We estimate that per $100 million deployed by the facility:
- 80 million tonnes of CO2 will be reduced or avoided
- 100 SMEs and 125,000 green and decent jobs and other local income-generating opportunities will be created (30-50% women)
- 600,000 people will benefit from improved livelihood opportunities and local climate resilience (50% women)
- Biodiversity/conservation outcomes will include: 2 million ha of land under sustainable management; 1 million ha of land under conservation; 1 million ha of degraded land restored
- USD 500M to 800M of private sector capital will be leveraged
- Metrics will be tracked through independent certified third-party sources, including agricultural and carbon credit certification reports, and audited financial statements (when there are no third-party certified carbon credits, we will rely on partnerships with MRV companies such as Pachama, Land Banking Group, and Lobelia)
- 30% of our investees will be women-led, and all our investees will have in place gender policy commitments and implementation plans to express and guide the gender ambitions in their own company and the enterprises they finance
- Colibri is a female owned and led facility that will promote female ownership, leadership and gender equality in the funds and enterprises that it supports, and in the distribution of benefits generated by natural climate solutions on the ground.