Development finance needs a new narrative

Development finance is at a crossroads. The old funding architecture has shifted dramatically, private capital is being called on to fill the gap, and the case for climate and social investment has arguably never been more urgent, yet the story being told to the audiences who matter most is not landing. Attending two major events in the past two weeks, it struck me that the sector's most pressing challenge right now is not the money, but the message. 

Oxford, where I live, is always buzzing with something. A conference, a graduation, a summer camp or a tour group that has somehow taken over every pavement. Most of the time I could do without it. But there is one week a year when the city fills up and I genuinely don't mind: when the Skoll World Forum comes to town, with social entrepreneurs and philanthropists spilling out of the Saïd Business School into the city's pubs and theatres. The sun showed up too, which helped. 

This week I'm in London for Innovation Zero, the annual conference bringing together innovators, funders, policymakers and business leaders trying to accelerate a just global transition to a low-carbon economy. I've spent both weeks hearing variations of the same underlying question: in a world that has fundamentally shifted, who is responsible for mobilising capital for good, and how do we talk about it so that it actually happens? 

Not anxious. Not this year. 

A year ago at Skoll, United States Agency for International Development (USAID) had just been dismantled and the mood in Oxford was grim. This year felt meaningfully different. Events were oversubscribed, queues were long, and more than once the best conversations were happening in them. 

What I noticed most was a recalibrated confidence and optimism, particularly among African and indigenous leaders. Not denial, not bravado, but a deliberate choice to treat the US funding withdrawal as an inflection point rather than just a crisis. The message from multiple delegates was essentially that they are going ahead regardless. Despite debt pressures, rising inequality and the energy shocks flowing from the Iran conflict, African growth rates remain projected above 4% a year. This is a story not getting the attention it deserves. 

The capital picture is more hopeful than the headlines suggest, too. According to the Organisation for Economic Co-operation and Development’s (OECD) latest Private Philanthropy for Development report, philanthropic giving from 2020 to 2023 reached $68 billion - at least 60% higher than previous estimates, and likely still undercounting. Germany has stepped in as the world's largest bilateral donor, contributing over $29 billion last year. The money is not gone. It has moved. 

Two conferences, one diagnosis  

And yet a pattern I kept hearing at Skoll - and one that Lord Adair Turner echoed in London - is that the social impact and sustainability sector tends to speak a language that resonates internally but struggles to travel. Compelling inside the room; less so to the asset allocators, policymakers and publics that actually need to be moved. 

A panel hosted by Water For People framed it starkly. Nearly 90% of climate disasters are water-related, yet climate finance flows to water nowhere near in proportion to that risk. A donor from Osprey Foundation investing in the water, sanitation and hygiene (WASH) sector offered the blunt explanation: the only way to unlock investment in WASH right now is to speak the language of climate resilience. Not because that framing is wrong, but because it is the one that opens the door. 

At Innovation Zero this week, Lord Adair Turner made the same diagnosis from a different angle. The energy transition community has overtold the moral case and underinvested in the economic one - and in doing so has lost rooms it needed to keep. He was equally clear that overpromising, making the transition sound cheaper or easier than it is, has eroded credibility.  

People need to know we are being straight with them, and that they will have agency in what comes next. Sometimes, he said, a little political courage is required to win the argument; neutrality is no longer a real option if you want to make real change. The appetite, though, is genuinely there. Private capital and philanthropy are increasingly moving as catalytic investors, willing to take early positions that do not generate traditional returns but create the conditions for others to follow. 

The conversation doesn't stop here. London Climate Action Week in June will bring another concentration of the same actors into the same rooms. The question of whether that conversation travels beyond those rooms is exactly what will determine whether the confidence I heard this week translates into anything measurable.