Insights

Catalytic communities: A new framework for accelerating sustainability impact

How catalytic communities build upon collective action initiatives

Complex challenges such as water scarcity, nature loss, and the transition away from fossil energy cannot be solved by any one public or private entity, no matter how large. These issues are simultaneously systemic in nature and highly localized — solutions to ecosystem degradation in one region will look vastly different than in another.

Sustainability practitioners have long understood the need to collaborate on shared challenges, which has given rise to concepts like collective action. Collective action, a framework for facilitating cooperation primarily between the private sector and non-governmental organizations (NGOs), has been widely embraced by corporations over the past decade. For example, a recent report found that sustainability experts rank collective action as the most effective strategy for water stewardship.

Collective action initiatives have undoubtedly achieved real gains. However, many fail to deliver on their true promise due to long-held alignment, funding, and coordination struggles that inhibit the speed and scale of solutions.

Catalytic communities offer a new approach to realizing the vision of collective action, enabling direct commercial relationships between stakeholders. Read on to learn what catalytic communities are, how they push the boundaries of traditional collective action initiatives, and a few leading examples of success.

Why catalytic communities

Tackling the ‘wicked’ and systemic nature of today’s sustainability problems requires a deep focus on innovation, speed, and scale. In the case of the transition to lower-carbon fuels, it requires a complete market overhaul to incentivize the production and adoption of renewable alternatives. Traditional collective action initiatives often can’t meet these demands because:

Stakeholders revert to going at it alone or in partnership with a small subset of other participants.
Funding is dispersed, and the actors most capable of driving transformative change — such as a startup producing renewable diesel or low-carbon building materials — don’t get the capital they need to scale.
Coalitions are built largely on good corporate intent, but strategy is fragmented.
Initiatives are overly focused on one subset of the problem, falling short on the systemic change needed to address them.

Catalytic communities build upon the collective action framework by enabling direct investment in innovative solutions — such as a participating corporation funding a shared research and development lab or piloting projects with a technology company.

They also approach their work with a systems lens. For example, acknowledging that water scarcity in a particular river basin cannot be solved without also addressing the extreme undervaluing of water in today’s economic system.

What are catalytic communities?

A catalytic community is an ecosystem of collaborators committed to unlocking the speed and scale needed to address wicked problems. They differentiate themselves by accelerating innovation through direct commercial relationships and catalyzing systemic change on a regional level.

Here’s a closer look at the defining characteristics of a catalytic community and why they’re so powerful:

Addressing the funding woes of collective action initiatives, catalytic communities enable and are even centered around a commercial relationship. Investment is typically supplied by corporations, but it can also come from utilities or public sector agencies willing to leverage their scale to absorb more risk associated with emerging technologies.

While collective action initiatives are typically corporate led, with involvement from NGOs and a few other stakeholders, catalytic communities strive to unite stakeholders across the full value chain of their respective focus areas. This includes government agencies, investors, utilities, NGOs, corporations, research institutions, academia, community groups, tribes, technology companies, and more.

Approaching it this way encourages rapid learning and ensures everyone with a material financial interest in the issue has a seat at the table.

When money exchanges hands, progress is unlocked for all stakeholders involved. Rather than waiting for public policy to incentivize new technologies, catalytic communities create the conditions needed for systemic change and market transformation.

With no prioritization of commercial relationships, typical corporate-corporate or corporate-NGO partnerships struggle to meaningfully deploy technology solutions. The technology-enabled focus of catalytic communities, such as an initiative involving AI-powered leak detection, makes impacts more immediately quantifiable. Similarly, their systems-focus positions them to deliver tangible economic value for the entire ecosystem, region, or local community.

Catalytic communities are also distinct in that they result in the creation of something tangible (such as an organization, tool, product, or entity) that didn’t previously exist and couldn’t have been created without the support of the catalytic community.

Catalytic communities in action

While catalytic communities are still an emerging concept, several promising initiatives tackling a variety of sustainability issues have already taken hold. Here are a few examples of success, and what sets them apart:

Water United is a private-public community of technologists, multinational water stewardship leaders, academics, forward-thinking water utilities, and NGOs who are working together to solve the biggest water challenges in the Colorado River Basin.

Goal: End water scarcity and improve access and water quality in the Colorado River Basin.

How they’re solving the problem: Water United is developing an AI watershed model of the Colorado River Basin, which will be the basis for data-informed and unified interventions across the basin that are scaled through the catalytic community.

What makes them different: Building upon its commercial relationship with FIDO AI and a growing roster of corporate investors, Water United is now enabling investment in a diversity of technology solutions that benefit utilities, agriculture, and manufacturing across the river basin.

Cascadia Sustainable Aviation Accelerator (CSAA) is a public-private coalition of stakeholders across the entire aviation value chain seeking to rapidly accelerate production and adoption of sustainable aviation fuel across the Pacific Northwest (PNW).

Goal: Reach 1 billion gallons of annual sustainable aviation fuel (SAF) production in the Pacific Northwest by 2035.

How they're solving the problem: CSAA harnesses the collective power of the entire aviation value chain to provide a shared services model that catalyzes direct investment in SAF startups, enables mutually beneficial offtakes with corporate buyers, and de-risk the entire SAF ecosystem.

What makes them different: Most collective action initiatives for SAF are hyper-focused on one slice of the overarching challenge, such as offtakes or public policy, or only involve a small range of stakeholders. CSAA convenes the broadest set of aviation stakeholders to drive systems-level interventions in the context of the PNW, building a viable and scalable market for SAF.

Closed Loop Partners (CLP) is a for-profit company with a capital arm, innovation center, and services provider at the forefront of accelerating the circular economy. Their ecosystem includes multinational corporations, technology companies, investors, research institutions, and municipalities.

Goal: Reduce, and eventually eliminate, the need for natural resource extraction and waste related to the manufacturing and use of products.

How they’re solving the problem: CLP simultaneously connects breakthrough technology solutions with venture capital and private equity dollars and enables cross-sector collaboration to test and scale material innovations.

What makes them different: Many coalitions tackling plastic production, waste, or other circular economy issues focus solely on policy, packaging design, or education for behavior change. By contrast, Closed Loop Partners emphasizes commercial viability and scalability of solutions and accelerates them through capital deployment and value-chain-wide partnerships that allow innovators to rapidly pilot, test, and learn.

100 Accelerator Logo

Launched in 2018 by AB InBev, the 100+ Accelerator is a corporate-led accelerator designed to find and support startups that can deliver breakthrough advancements across 5 key sustainability pillars: water stewardship, smart agriculture, circular packaging, climate action, and upcycling.

Goal: Support the achievement of the UN SDGs and exponentially fuel the growth of startups developing critical sustainability solutions.

How they’re solving the problem: The 100+ Accelerator leverages the teams and supply chains of global corporate partners, including 6 of largest consumers goods companies, to work with startups and help bring their solutions to market faster.

What makes them different: The 100+ Accelerator focuses exclusively on sustainability. The program defines new priority challenges every year based on industry expertise and the needs of the corporate partners and aims to commercialize relationships between program graduates and at least one participating corporate stakeholder.

Beyond collective action

The catalytic community examples presented above are all widely applicable to other regions, watersheds, and ecosystems. Their application couldn’t be more timely.

This past decade has seen some remarkable pockets of action across water stewardship, renewable fuel adoption, regenerative agriculture, and much more. However, overall progress toward the sustainable economic transition remains stubbornly slow. Catalytic communities provide a unique opportunity to unlock speed and scale while delivering quantifiable economic value to the businesses and communities involved.

Interested in exploring what a catalytic community might look like in your region? Our team brings deep expertise in convening public-private partnerships that tackle some of today’s most intractable sustainability challenges.

Learn how we can help

Earth Finance would like to acknowledge the work of Tom Higley and Richard Farthing-Nichol in helping develop the catalytic community framework.

Related insights

All insights

Article Catalytic communities: A new framework for accelerating sustainability impact

Read

Case Study Implementing a commercial retailer’s low-carbon concrete strategy

Read

Article Why integrating climate, water, and nature strategy can't wait

Read