Mercer and British International Investment call on asset managers to help scale climate finance in emerging economies 

British International Investment (BII) is the UK’s development finance institution and impact investor with a mission to help solve the biggest global development challenges by investing patient, flexible capital to support private sector growth and innovation. Sitting at the heart of the UK Government’s international financing offer to emerging economies, BII invests between $1.5 and $2 billion every year in green infrastructure, technology and other sectors across Africa, Asia and the Caribbean where it can create the greatest impact for the benefit of those who need this capital the most.

Launched at the UN General Assembly by Prime Minister Keir Starmer, BII’s Mobilisation Facility is a new £100m blended finance facility which focuses specifically on active mobilisation of institutional investor capital into BII investments, particularly with a climate focus.

The Mobilisation Facility will be BII’s first concessional mandate that is not aimed at mitigating BII’s own risk to increase depth of impact, but instead aimed at mitigating the risks of other investors to help mobilise their capital to increase collective impact at scale. This is critical to achieve BII’s climate impact ambitions, where impact scale is paramount. 

The Mobilisation Facility financing is intended to bridge the ‘relative value gap’ between institutional investors’ risk-return appetite, and the risk-return profile of BII’s portfolio/pipeline, by offering considerable risk mitigation.

This initiative is open to asset managers with a proven track record in climate finance and investment in EMDEs. Eligible participants must demonstrate that:

• You have a demonstrable track record in private markets (at least one of private equity, private credit or infrastructure)
  
  
• Your total assets under management (AUM) exceed £5bn
  
  
• You have defined Net Zero targets and/or that you have started to develop an initial roadmap or transition plan
  
  
• You adhere to BII compliance, business integrity and environmental/social policies. This will be assessed by the following checks during the first phase of screening: Sophisticated/Professional Investor status; Environmental and social incident history; and sanctions checks.

• Active mobilisation objective: clear intent and strong likelihood of increasing private capital in EMDEs
  
  
• Large-scale climate impact: reducing CO2 emissions and/or supporting climate transition (covering mitigation and/or adaptation) at scale in EMDEs
  
  
• Subsidy kept to a minimum: lower subsidy solutions such as unfunded guarantees or returns caps preferred to higher subsidy solutions such as first loss tranches
  
  
• Subsidy is of a temporary or time-bound nature: Evidence given for why subsidy is expected to reduce over time or in future iterations of the concept
  
  
• Smallest subsidy size in proportion to impact (cost-effective)
  
  
• 90%+ focus on climate finance
  
  
• Minimum mobilisation ratio target of 5:1 (Private capital mobilised: Mobilisation Facility capital in $)
  
  
• Execution feasible within a 1–2-year timeframe.

• Scalability: The ability of the solution to scale commercial capital flows into EMDEs
  
  
• Impact: The potential environmental, social, and economic benefits
  
  
• Feasibility: The practicality and viability of the implementation plan
  
  
• Replicability: The ability to replicate and scale the strategy in other iterations
  
  
• Sustainability The long-term sustainability of the proposed solution.

BII and Mercer intend to hold a Bidders’ Briefing meeting at the BII offices in London after distribution of the Call for Proposals documents. This session will allow the Bidders to resolve any questions about BII’s Specification, the Call for Proposals documents and the process.

The bidder briefing will be held on 6 February 2025.

Bidders are asked to attend with no more than two representatives from their organisation and notify Mercer of attendees in advance. Bidders must confirm to Mercer via email the attendees (name and position) by 24 January 2025 in order for BII to make arrangements for the briefing. There will also be a streaming link available for bidders unable to attend in person.

• Dedicated time with the BII Deal Team to help develop the successful concept/s to the appropriate level to confidently enter BII’s internal investment committee (IC) process
  
  
• Entry into BII’s IC process for consideration of the required capital from BII to anchor each concept (for both concessional and non-concessional funding)
  
  
• Public recognition and promotion through BII’s and Mercer’s networks
  
  
• Ongoing support and collaboration opportunities with industry experts across climate and EM investing ecosystems.

• Call for Proposals documentation distributed to eligible asset managers: 28 January 2025
  
  
• Bidders Brief: 6 February 2025
  
  
• Submission deadline: 4 March 2025
  
  
• Notify longlisted asset managers: March 2025
  
  
• More detailed proposals requested from longlisted asset managers: March 2025
  
  
• Submission deadline: April 2025
  
  
• Discuss and refine proposals with shortlisted managers: April through June 2025
  
  
• Manager presentation to judging panel, evaluation and selection: June/July 2025
  
  
• Successful proposal/s enter into BII IC Process: Q3 2025.