In 2009, a twenty-one-year-old from the Netherlands broke an unusual world record. He succeeded in knocking over the largest-ever domino, at 6.4 meters tall and 1.2 meters thick. What was most extraordinary about the exercise, though, which incidentally you can watch on Dutch TV, isn’t the toppling of the mega-sized domino. Not at all. What’s most extraordinary is the domino chain, which was 19 dominoes long, began with a very humble typically-sized domino of only 2 inches long and 1 inch thick.

This is the magic of a domino effect: not only its ability to unleash a chain of outcomes, but also its ability to unleash a chain of outsized outcomes.

Climate philanthropy can have the same effect.

One of the fundamental ways in which we observe and measure this effect is in the unleashing of capital. Like the small-sized domino, well-targeted and well-timed philanthropic capital can unlock much greater amounts of public and private capital. 

Meanwhile capital matters a lot when it comes to Canada’s transition to a prosperous, net-zero emissions economy.

In 2021, RBC calculated that transitioning Canada to a net-zero economy will ultimately require $2 trillion in capital, or an average of roughly $70 billion in investments per year.

The bulk of these investments, of course, must be private sector. Think the steel industry subbing in electric arc furnaces; businesses converting their fleets to EVs; and homeowners buying energy efficient windows.

Public investment will also be a sizeable slice of the total, providing incentives that de-risk and mitigate private investments. 

But in addition to these two well-known sources of capital for the net zero transition, there is a catalytic and outsized role to be played by philanthropy. Well-targeted climate philanthropy can be the all-important domino at the front of the chain, unleashing an unstoppable wave of investment that carries Canada to net zero.

Some philanthropically-funded projects show this effect with amazing clarity.

Take the example of Accelerate Alliance. The non-profit initiative with a mission to advance a competitive electric vehicle industry and supply chain in Canada was established in 2021 with roughly $1 million in philanthropic capital. That capital quickly multiplied. Accelerate’s influential advocacy helped trigger a domino chain of investment between 2020 and 2024 that produced up to $52 billion in government incentives and $46.1 billion in commitments from the likes of Honda, Stellantis, LG, Volkswagen and Ford for next-generation vehicle manufacturing and upstream supply chains. Naturally Accelerate was not the only force at play here and can’t take full credit for unlocking these massive public and private investments. However it did play a big role, having been carefully designed to fill a noticeable gap in the policy advocacy ecosystem and to achieve exactly this goal.

Consider also the case of the Low Carbon Cities Canada (LC3) network. This initiative was struck in 2019 with a view to equipping six cities across Canada with independent centres of climate programming and investment. The model was The Atmospheric Fund (TAF), in the Greater Toronto and Hamilton Area, which had been successfully seeding transformative climate projects at the community level with the help of a public endowment since 1991. Philanthropy was critical for making the case that other cities should have the same opportunity. A modest grant of $800,000 for scoping work and partnership development quickly laid the groundwork for what became a $183-million government investment to establish LC3 centres in Halifax, Montreal, Ottawa, Edmonton and Calgary, and Vancouver. And now the domino chain continues, with that government capital being strategically allocated by the individual LC3 centres to climate projects that crowd in private capital. Since 2021, $13.5 million in LC3 funding – for projects like school bus electrification and apartment building retrofits – has led to $50 million in additional investment. Not bad ROI for an initial philanthropic gift of $800,000.

Farmers for Climate Solutions has delivered a similarly impressive return on investment. This non-profit group turned $350,000 in annual grant revenue into a policy-smart stakeholder coalition that played a major role in securing the federal government’s $700-million On-Farm Climate Action Fund in 2021. This government capital is itself incentivizing ongoing farmer investments in green agricultural practices all across Canada.

Meanwhile Efficiency Canada’s powerful research and policy work, which has been fuelled by philanthropic grants since its launch in 2018, is frequently credited for bringing about, among other things, the more than $750 million in government programs that are helping households in largely rural areas switch from oil heating to electric heat pumps.

A final example for noting here is The Transition Accelerator. In 2021, the registered charity drew on philanthropic grants to launch the Edmonton Region Hydrogen Hub, an ambitious initiative designed to build a new region-wide energy system based on zero-emission hydrogen. That initiative has since led to 25 projects in partnership with government, industry, business, First Nations and other implementation partners. One signature project is the piloting of Canada’s first hydrogen fuel cell electric buses, which has so far secured $10 million in funds from provincial, municipal and federal governments and is stimulating a variety of private sector investments.

The impact of climate philanthropy can be measured in many ways. One that shouldn’t go unnoticed is its potentially outsized domino effect on public and private capital. Since it will take massive amounts of capital to fuel Canada’s net zero transition, this is one impact that we should pay special attention to.