Climate and water: Leveraging private sector engagement for sustainable development

In the year 2021, global demand for energy-related CO2 emissions is projected to grow by 4.8%, as demand for coal, oil and gas rebounds with the economy. The world’s seven richest countries, together known as the G7 countries, contribute about 30% of global emissions currently. One of the positive outcomes of the Paris Agreement on Climate Change back in 2015 was a pledge from the rich countries to provide $100 billion a year, starting from 2020, to help the poorer countries tackle climate change through mitigation and adaptation actions. 

As part of that promise, they have to kick start channelizing the finance from 2020, which in reality, has not likely been delivered. It is difficult to pin-point how much was actually delivered. Estimates show that perhaps $70 to 80 billion might have been delivered in 2020. Delivering the deficit for 2020 as well as another $100 billion for 2021 will be the test for the developed countries. 

Since the announcement of climate finance from developed countries, one major demand from the vulnerable developing countries for a long time has been to allocate 50% of the climate change fund to support the adaptation measures. But in practice, only 20% of climate finance provided has gone to support adaptation. 

While climate finance is already weak compared to the estimated needs of the vulnerable countries, the share of adaptation finance is minimal, pushing adaptation to take a back seat. The mobilization of the existing climate finance to the most vulnerable is also questionable. Data indicate that only 10% of the money provided for adaptation could be tracked to the most vulnerable communities. 

Bangladesh’s reality 

Bangladesh is exceptionally vulnerable to climate change owing to its low elevation, high population density coupled with poor infrastructure and heavy reliance on natural resource-dependent livelihood. It is estimated that, by 2050, with a projected 50cm sea-level rise, the country will lose 11% of its land affecting 15 million people living in the coastal region. 

The effects of climate change are first felt through changes in water cycle. Impacts of climate change on water systems include damage to infrastructure from flooding, loss of water sources due to declining rainfall and increasing demand, and changes in the water quality of water sources and within distribution of water. Sanitation concerns include damage and loss of services from floods and reduced carrying capacity of receiving wastewater. 

“Since the announcement of climate finance from developed countries, one major demand from the vulnerable developing countries for a long time has been to allocate 50% of the climate change fund to support the adaptation measures”

These changes have a direct impact on the sustainability of water and sanitation services and behaviours. Access to improved water, sanitation and hygiene are critical for socio-economic development, healthy environments and vital for reducing the global burden of disease. Moreover, the availability of secured sources of water, improved provision of durable sanitation and reliable hygiene mechanisms increase the adaptive capacity of vulnerable communities during disasters. 

The impacts of two recent cyclones, Amphan and Yaas, and monsoon floods amid the global pandemic on the local communities have also emphasized the importance of access to safe water, sanitation, and hygiene (WASH) facilities in building stronger adaptive capacity to climate change. In 2020, Bangladesh experienced flood damages costing around $476 million in repairs and reduced WASH benefits. As a region with a high proportion of emergency and fragile context responses, it is important to consider how to move from humanitarian to sustainable WASH solutions. 

Private sector engagement is key to tackling climate change and build resilient WASH services

Bangladesh government has made significant progress in financing climate adaptation measures. The country has been allocating climate budget in 25 key relevant ministries and in FY 2020-21, 7.52% allocation of the total budget of 25 ministries/divisions is climate-relevant. 

While the public sector finance in climate change has been praiseworthy, there is a clear need of increased engagement of private sector in both climate adaptation and mitigation through innovation and technological advancement. In crucial sectors like water, sanitation and hygiene, the private sector can play a key role in expanding water and sanitation infrastructure and improving the efficiency of water system. 

Businesses engagement to mitigate some effects and adapt to others, to protect the communities and foster sustainable economic growth is need of the time. Despite such need, the role of the private sector has been minimally leveraged in this area. Only a handful of big companies and private entities have come forward in the aid of communities with innovative technologies and services to ensure sustainable WASH services and reach to the poorest as trendsetters in Bangladesh. 

An Unilever official supports an entrepreneur amid the Covid-19 pandemic in Bangladesh Courtesy

HSBC, a leading global financial institution is one of those companies which has been investing in sustainable WASH solutions. It is committed to a transition to a global net-zero economy, through mobilizing finance and accelerating innovation. Syeda Afzalun Nessa, Head of Corporate Sustainability, HSBC Bangladesh, said that HSBC took up an ambitious plan last year to prioritize sustainable financing and investment to transit towards a net zero economy. 

Coming out of the Corporate Social Responsibility (CSR) loop, HSBC is devoted to Corporate Sustainability (CS) by investing on long term climate solutions. In 2012, HSBC launched its Water Programme to tackle the global water crisis in partnership with Earthwatch, WaterAid and WWF. During this 8-year long program, HSBC and its partners strengthened systems for clean water, decent toilets and good hygiene for communities in six countries including Bangladesh. 

Throughout this initiative, which has taken place in five climate-vulnerable and hard to reach areas of Bangladesh, almost 26,000 people have been reached with clean water in their houses and communities; more than 70,500 people were reached with decent toilets and 65,000 people were reached with hygiene promotion activities.

They have worked with local government and raised female entrepreneurs to achieve sustainable clean water, decent toilets and good hygiene for the most vulnerable. Female hygiene is highly prioritized in HSBC’s work; in Bangladesh, HSBC together with WaterAid has distributed hygiene kits to school-going girls, raised awareness on menstrual hygiene at community level as well as in important sectors such as RMG. 

Scaling hygiene in climate prone areas demonstrated by HSBC is replicable.  Apart from investing on water technologies and services, HSBC is also contributing to building adaptive capacities through provision of livelihood support and skill development in climate vulnerable regions. With an outstanding portfolio of investments in climate adaptation, HSBC is now planning to support towards energy efficiency and transition towards a net zero economy. 

“Scaling hygiene in climate prone areas demonstrated by HSBC is replicable.  Apart from investing on water technologies and services, HSBC is also contributing to building adaptive capacities through provision of livelihood support and skill development in climate vulnerable regions”

Unilever Bangladesh has also made remarkable contributions when it comes to sustainable WASH solutions. In order to fight climate change and protect nature, Unilever has put forward a climate transition action plan with an ambitious commitment to reach net-zero carbon emission by 2039. 

According to Shamima Akter, Head of Corporate Affairs, Partnership and Communications, Unilever Bangladesh, Unilever has launched three products to contribute in achieving SDG 6, namely, clean water and sanitation. These are Pureit water purifier to ensure clean drinking water, Domex disinfectant toilet cleaning brand with innovative product suitable for Bangladesh to ensure safe sanitation, and Lifebuoy hand wash to ensure proper hygiene. 

Early this year Unilever’s brand Pureit — in collaboration with Aspire to Innovate (A2i), Dhaka WASA, Department of Environment (DoE), 2030 Water Resources Group (2030 WRG), Bangladesh Association of Software and Information Services (BASIS) and Bangladesh Computer Samity (BCS) — launched the “Water Innovation Challenge Competition-2021” to find an ICT based solution to save water resources. The result is expected to help the government make informed investment decisions for fresh water and recycled water infrastructure. 

Unilever Bangladesh has always taken various initiative in its supply chain to ensure sustainable operations, the company says. From 2010 to 2020 Unilever Bangladesh has reduced water consumption in its operations by 37%, specific energy consumption by 26% and CO2 consumption by 22%. 

In order to reduce stress on a scarce resource like water, Unilever Bangladesh is investing on water-smart products through innovation and modern technologies, making it easier for consumers to use less water at home. With an aim to produce biodegradable products by 2030, they are investing on products that are washed off after use, which includes laundry, household cleaning, skin cleansing, oral care and hair care products. 

In order to encourage new businesses, Unilever under its global initiative TRANSFORM is collaborating with eight young entrepreneurs in Bangladesh to create new business solutions in the areas of good health and wellbeing (SDG 3) and clean water and sanitation (SDG 6). The TRANSFORM initiative is focusing on marketing and sales to increase the demand for SWEEP services for fecal sludge management as well as transforming South Asia’s water crisis into an entrepreneurial opportunity by using a micro-franchise model to provide clean drinking water.

“From 2010 to 2020 Unilever Bangladesh has reduced water consumption in its operations by 37%, specific energy consumption by 26% and CO2 consumption by 22%”

While the contributions of big companies in sustainable WASH solutions have been inspiring, there is a clear need to build the readiness of the rest of the private sector to invest on sustainable WASH solutions and climate-smart initiatives. 

Key recommendations for enhancing collaboration 

A platform to bring together private sector and development partners in realizing the critical challenges and working together to tackle water and climate change is essential. Progressive companies across all sectors hold great power to change the tide against climate change and therefore can transform their own financial prospects while ensuring wider services to communities. There is need to work together with focused technical expertise to build the case for mitigation and adaptation investments in Bangladesh. 

Lack of understanding of co-financing and Public Private Partnership (PPP) concept by many central and local agencies of the government needs to sync in cohesion with other sector actors. Poor sustainability concern among private entities, lack of understanding of the commercial rationale for engaging in climate-smart solutions, capacity constraints and regulatory barriers need to be revisited for an enabling environment. Incentives from the government to encourage local private sector investment together with building capacities of businesses on climate change and water efficiency can go a long way in leveraging private sector investments in climate-resilient WASH initiatives.  

Solutions are available to address these challenges, companies need to disseminate and share their stories more and work together quickly with the development sector, government, and academia. Private sector can powerfully influence for WASH investment with business partners, collaborators, and governments, accelerating towards realizing the Sustainable Development Goal 6 and 13. 

Shahrin currently works as a Senior Research Officer at the International Centre for Climate Change and Development (ICCCAD). 

Faysal Abbas works as Manager, Advocacy and Communications at WaterAid Bangladesh.