selecting from applicants
“There have been occasions where clients have experienced
difficulty in using their loan fund effectively after an interval:
we work with them to restructure their funds where appropriate.”
accepts that the finance itself is only part of
its contribution to carbon reduction. “The dedi-
cated funding structure stimulates changes
Wind turbines will
which are often quite basic – the replacement
play an important
of lighting systems in a hospital, for example
role in sourcing the
– but which would easily be overlooked.” quota of renewable
The question must be whether Salix Finance
has been able to use that influence to save
energy required by
carbon in significant quantities. The published
2020, but, their
savings of 89,000 tonnes of CO
2
each year payback period is
demonstrate what can happen when the cor-
porate mindset is focussed.
outside the scope of
Salix Finance.
Salix model could be scaled
In theory at least, the Salix model is infinitely ensure the delivery of the highest level of car-
scalable, but is the same true of the funds bon savings per pound of loan made. Qualify-
which the company has available to lend? ing for Salix support is all about demonstrat-
The amount of money allocated for its valu- ing an effective management team for the
able work has not risen, while a growing aware- projects and convincing the field analysts who
ness of carbon reduction has steadily stimu- scrutinise those proposals that the projects
lated demand. There is some way to go, before are realistic.
the company is in a position to fund every pub- Alastair Keir was able to provide some in-
lic sector institution in its carbon reduction sight to the performance of Salix Finance’s
endeavours. clients in practice. “Experience shows that
Working within its budget, Salix has to iden- carbon savings either equal or exceed the lev-
tify the best applicants; an assessment proc- els projected; certainly in the cases where it
ess that involves not only a rating of each ap- is possible to gauge actual rather than theo-
plicant’s projects but whether they have the retical reductions.
management in place to see those initiatives “There have been occasions where clients
through to conclusion. have experienced difficulty in using their loan
When the Salix team had to select English fund effectively after an interval: we work
Universities for funding through a dedicated closely with them to restructure their funds
scheme for higher education which it man- where appropriate.”
ages, rounds of interviews and detailed as-
sessment of the projects being proposed found
the applicants eventually ranked in an order
Meeting objectives in 2009?
of merit. Funds were then allocated to each Five years on from its inception, Salix Finance
establishment in descending order until the has been able to demonstrate a broadly-based
total sum had been exhausted. portfolio of success stories right across the
public sector. Its methodology of recycling
Equitable approach to funding
loan funds is geared to increasing the total
carbon reduction that can be achieved with a
This approach to selecting the public sector given size of loan to a client’s fund. It is a
institutions who will be awarded funding is financial engineering tool that is distinctly fit
probably the most equitable in that it should for purpose. §
The amount of money allocated to Salix has not risen, while demand has grown steadily. There is
some way to go, before it can fund every public sector institution in its carbon reduction endeavours.
The Informed Executive
27
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