CLEVER Cities D5.3 - Governance, business and finance models

Authors: EBN, Social Finance, ICLEI Europe

CLEVER Cities

This report has been produced as a part of the CLEVER Cities project within Work Package 5, looking at CLEVER solutions to bring NbS from innovation to market. It is divided into three sections: Governance Models for NbS, Business Models for NbS and Financing Models for NbS. Together, these sections make up deliverable 5.3 which connects CLEVER solutions with business and financing opportunities. All three sections of this deliverable tie together to support the creators of NbS projects to implement sustainable NbS projects with long-term value for all stakeholders.

This report has been developed to support cities and organisations who are setting up an NbS project, however in each section a range of options have been examined and as such there may be resources and information that other organisations or stakeholders will find useful throughout the NbS lifecycle.
The governance section of this report examines the governance models and more significantly the overarching elements of these models in the implementation of NbS. It first distils existing models from NbS sister projects, examining these in the context of CLEVER. Following is the methodology behind and the identification of the fundamentals of CLEVER governance which can be used as a mapping tool across all stages of the application of NbS. This section also addresses the challenges and drivers related to governance in NbS and addresses how the five fundamentals established in the report have been employed in the CLEVER leading cities as a show of best practice.

The business model section of this report has been created in order to address the gap between the significant value of NbS and the market uptake. This section frames value not as financial income for profit but identifies the diverse range of value sources in areas such as social, health and environment benefits. Business models in this report are used as a framework for describing the connections between stakeholders and illustrating how NbS can be used to create, deliver, and capture value.
While the majority of NbS are funded through public budgets, alternative funding solutions have increased2. Upfront and ongoing funding sources for NbS have grown in diversity, reflecting the innovation in the solutions themselves which has taken place over the last few decades. The financing section of this report examines the funding sources and financing solutions available for NbS projects of various scales and types. Using case studies to illustrate proven past and current financing solutions, the report also provides examples of innovative financing solutions which can be implemented in future NbS projects.
This section is focused around 6 steps in order to provide a methodical approach for cities to determine the optimal solution in each case before discussing how these steps can be used to create one financial solution. These steps are: Selecting the NbS, Understanding the benefits of NbS, Identifying funders, Identifying funding types, Identifying financing mechanisms, and Building a financial model. While this report has been written for public authorities, other stakeholders in the funding of NbS (such as investors, businesses, and foundations) may also find it useful.

https://clevercities.eu/resources/deliverables-and-reports/