It’s 2050 and we are no longer worried about climate change. How did we get here?
To paraphrase climate activist and marine biologist Ayana Elizabeth Johnson: we got it right.
We got rid of stark inequality and extreme poverty. Everyone lives within their means (doughnut economics style). And it’s comfortable: we have nice clothes, eat delicious, in-season food, live in cozy homes, take vacations, and consume and create art for most of our time. AI does all the menial tasks, so humans can focus on the meaningful ones. We’re not bored because between regenerative farming, tending to our possessions, and taking care of one another, there is work to do. We’re not burning out because life is sustainable.
Back to 2025: we are being asked to meet the moment. To respond to unprecedented challenges that reverberate from the humanitarian sector to the wider global economy, we need a credible vision for a better world – to get off the sidelines and do the work of actual systems change. We have a chance to finally get it right.
In the humanitarian sector, the discipline of innovative finance was born out of a need to address the pervasive, longstanding funding gap for humanitarian needs: $40 billion, or half of all need, has gone unfunded every year for many years. That was before the current US administration pulled the plug on an additional $40 million in annual aid and development funding through the U.S. Development Agency (USAID).
When I entered the humanitarian sector from banking five years ago I wasn’t shocked at the funding gap, but at how nominally small it was. Forty billion dollars is the size of one investment fund on Wall Street. It was very clear this wasn’t a money problem, but a systemic – and political will – problem.
Now the global humanitarian system is collapsing in 2025 because of a money problem. We have a choice to make: we can respond with a scarcity mindset and hope that, as individual organizations, we can beg or borrow our way out. Or we can finally force the private, development, and humanitarian sectors to stop operating in silos next to one another and start to work together towards better, more sustainable outcomes for all communities, all over the world.
Building a better system
The aid and development systems we have today were built on colonialism. So were our financial systems. Bretton Woods was convened 13 years before the first African countries won independence. We have long known these systems were broken, or worse, designed to prevent problems from being fixed.
What should we do now? Build from the ground up; as partners. We can co-design solutions with Indigenous knowledge and communities that are on the frontlines of climate change: all political solutions are local, all climate solutions are local.
In the philanthropy world, we need to listen to what communities need and deliver exactly that. We need to stop making individuals, organizations, and countries waste resources jumping through hoops and box-ticking. We need to support organizations on the frontline – the ones that are responding directly to community needs. We need to trust one another.
To the capital on the sidelines: this is a call to action. I am looking at you, private philanthropists, impact investors, banks with sustainability teams, and family offices. We all need to get more comfortable with losing some gains in the short-term to sustain the long-term.
We may not have much time, but we do have all the tools we need. At the International Rescue Committee we developed a playbook for how to break down silos and build partnerships across sectors to drive new sources of funding, finance and investment to achieve better humanitarian outcomes.
So have many others: CrossBoundary has advised on $11 billion of transactions across impactful sectors in frontier markets. Its examples include using first-loss funding from USAID to seed and derisk its commercial and industrial solar energy fund – capital it returned to USAID and delivered a 15% internal rate of return on a vehicle that family offices had been reluctant to support without risk mitigation.
The Danish Refugee Council and iGravity have built a Refugee Investment Fund that provides impact-linked loans to refugee-lens small businesses. The ICRC and the World Bank are building water infrastructure in the Democratic Republic of the Congo’s conflict-affected West Goma region. Many of us in the humanitarian sector are advocating for sovereign debt swaps, which are being used to support nature conservancy and restoration, to be utilized for social outcomes as well. Many actors across sectors have already made commitments that could drive up to $5.9 billion of new investment in frontier markets.
How to ‘get it right’
Building on the track record of these projects (and many more), now is the time for investors to create catalytic capital strategies, put aside money for a blended finance fund, or allocate technical assistance funds. You should also support the design and capitalization of country-level endowment funds to address the pressing needs of frontline communities.
Now is the time of monsters. But if so few can do so much harm, imagine what a few can do if we commit to a better world. Watching from the brink – the ugliness of humanity, the genocidal tendencies I wish were glitches – I still choose optimism as my strategy. Politicians and corporations can refuse to act, or even actively undermine progress, but we can choose to respond with solutions and support for the people behind them.
It’s all connected. If we – those with any kind of power at all – work to address imbalances, do the work in our daily lives to share power and resources, commit to decolonialization, and support the work of those who can do it better, things can change. We will get it right.
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Ellen Brooks is Director, Innovative Finance, for the International Rescue Committee.
