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For the LuxAid Challenge Fund, the criterion futureproof refers to adaptation to future risks and trends, such as climate change and land degradation, changing consumption patterns and industry 4.0.
Looking at the project’s overall potential impact (positive and negative, short- and long-term), is the project economically, socially and environmentally sustainable and forward-looking with regard to major global risks, threats and trends? For example, depending on the objectives of each action, does the project include in its analysis the risks and impacts as well as the opportunities that megatrends such as climate change and the fourth industrial revolution (among others) could have on its business case?
In the context of the LuxAid Challenge Fund, an innovation is a new solution with the transformative capacity to accelerate impact. Innovation is about creating, finding, adapting and applying new ideas, approaches, products, services or methods to solve existing problems or address unmet needs. It is not limited to the creation of something completely new, but also encompasses the significant and creative modification of what already exists, or its use in a new context. Also, innovation can provide a solution that had no local demand because it was unknown, but which meets a real need in terms of impact.
To be considered “innovative”, the solution must be sufficiently distinct from other products, services or approaches already on the market in the country in question. This can mean distinctions in product/service design features to better meet needs, distribution model, customer segment (i.e. offering new products or services to previously underserved populations), business model (who pays and who benefits, price), product or service resilience (anticipating future developments).
In the context of the LuxAid Challenge Fund, additionality marks a positive contribution that would not have occurred without co-financing, and generally characterizes projects that take bold risks to deliver innovative and impactful solutions. To assess additionality, the selection committees will analyze:
- the extent to which the company cannot self-finance the project (within a reasonable timeframe) or access equivalent support from a commercial investor;
- The extent to which the project’s results would not have taken place without the co-financing, are greater in scope, better in quality or are achieved more quickly;
- the project’s potential to stimulate replication of the model or systemic change in this market or industry.
Applications will be evaluated by a national selection committee made up of 3 or 5 members representing the LuxDev office and the Luxembourg Embassy in the country, an investment/private sector expert, and thematic/sector experts;
The applications shortlisted following the due diligence process will then be evaluated by an international committee made up of 3 or 5 members representing LuxDev headquarters, the Ministry of Foreign and European Affairs, an investment/private sector expert, and thematic/sectoral experts;
Non-voting members and observers may be invited to take part in the pitch sessions and deliberations of both committees, subject to signing a declaration of impartiality and confidentiality. The selection committees reserve the right to delegate the analysis of applications to LuxDev and/or an external supplier with a view to shortlisting the best applications, organizing field visits and conducting due diligence on each shortlisted project and company. Anyone involved or having access to documents provided by companies will sign a confidentiality agreement. Selection committee members will also sign a declaration of impartiality and absence of conflict of interest.