The head of the World Bank, Jim Yong Kim, is stepping down three years early to join the investment firm Global Infrastructure Partners, which focuses on investing in renewable power generation assets in developing countries, according to the Financial Times. News of his departure next week caught many in the financial world by surprise, but it also signals the growing importance and profitability of the development of green infrastructure.
- Renewable energy funds, according to industry analysts, raised a record $42 billion last year — which was twice as much as was raised in 2017;
- Renewable energy funds overall have raised $280 billion and more than two-thirds of that money is already invested in projects; and
- A survey by the American Council on Renewable Energy last year found investors in the U.S. and Europe bullish on renewables — each market could attract $1trillion in financing by 2030.
The Times’ Owen Walker attributes this increase to more demand for renewables because countries are looking for ways to meet their commitments under the Paris Agreement. But more than that, it is the investors themselves that are looking to make their money “greener” — including institutional investors whose customers are demanding that their retirement accounts have a low carbon footprint.
It is an interesting move for Kim, who is a medical doctor by training, and co-founded the nonprofit health care organization Partners in Health in 1987 and also served as President of Dartmouth College. He has been President of the Bank since 2012, and had accepted another five-year term in 2017.
Why This Matters: The World Bank is one of the largest donors to infrastructure projects in developing countries. Its leadership has a huge say in how green those projects will be. The U.S. President — or his chief advisors — will say who is nominated, because the U.S. government is the largest investor in the bank, holding 17% of its shares. Who will President Trump nominate? According to CNN, Ivanka Trump is running the nomination process and Idra Nooyi, the former CEO of Pepsi, is the top contender. Nooyi was a mentor to Ivanka, and if selected, she would be the first woman to lead the Bank. The question is whether a Trump pick would prioritize climate adaptation and renewable energy projects.