The Role of Development Finance Institutions in Accelerating the Mobilisation of Green Capital

The report finds that while European DFIs are central to public climate finance, their current private capital mobilisation levels are low, with most lacking specific mobilisation targets. It identifies barriers such as low risk appetite from shareholders, a preference for transaction-level tools over institutional-level ones, and regulatory hurdles like the EU Taxonomy's limited applicability outside Europe. The document proposes 30 recommendations, including adopting broader mobilisation definitions, increasing on-selling of assets, and enhancing transparency through databases like GEMs to attract private investors.

• Current private capital mobilisation levels among European DFIs are low; for example, in 2022, the EBRD and EIB's mobilisation was only 20% and 15% of their respective balance sheet sizes, while EDFI members' combined mobilisation reached only 1% of their total balance sheet size.
• There is a significant gap in the use of mobilisation targets: only 37% of the analysed DFIs have published a private capital mobilisation target, and these are not linked to their climate objectives.
• DFIs show a preference for transaction-level mobilisation tools over institutional-level tools, which may be driven by the ease of reporting and measurement at the transaction level.
• On-selling of assets is underutilised as a mobilisation strategy, with only 26% of DFIs specifying its use, despite the potential to free up balance sheets for new projects once a project's risk profile decreases during the operational stage.
• The EU Taxonomy presents significant barriers for DFIs operating outside the EU because it references EU legislation and lacks definitions for key sectors like agriculture, leading to very low proportions of DFI balance sheets being Taxonomy-aligned.
• Shareholder expectations for returns and dividends can limit DFI risk appetite and the availability of finance for concessional mobilisation structures; for instance, in 2023, CDP paid 48.96% of its net profit as a dividend.
• Currency risk is a major obstacle to mobilisation, as 80% of DFI and MDB emerging market lending is in hard currency, creating a mismatch with local currency revenues and making commercial cross-currency swaps expensive.
• A lack of transparency regarding investment performance and loan default rates hinders private investor appetite; the report suggests increasing the availability of data from the Global Emerging Markets Risk Database (GEMs).
• If all 23 European DFIs matched the current best-in-class mobilisation efforts (such as the EBRD's 20% ratio), they would mobilise EUR 370bn per year, and doubling this would reach EUR 740bn per year.

APA

Burge, L., Van Coppenollle, M., & Blagborough, C. (2024). The Role of Development Finance Institutions in Accelerating the Mobilisation of Green Capital. Climate Bonds Initiative. https://www.climatebonds.net/files/documents/publications/The-Role-of-DFIs-in-Accelerating-the-Mobilisation-of-Green-Capital.pdf

Chicago

Burge, Lily, Magali Van Coppenollle, and Charlie Blagborough. The Role of Development Finance Institutions in Accelerating the Mobilisation of Green Capital. Climate Bonds Initiative, 2024. https://www.climatebonds.net/files/documents/publications/The-Role-of-DFIs-in-Accelerating-the-Mobilisation-of-Green-Capital.pdf.

Wikipedia

{{cite report |last1=Burge |first1=Lily |last2=Van Coppenollle |first2=Magali |last3=Blagborough |first3=Charlie |title=The Role of Development Finance Institutions in Accelerating the Mobilisation of Green Capital |publisher=Climate Bonds Initiative |date=November 2024 |url=https://www.climatebonds.net/files/documents/publications/The-Role-of-DFIs-in-Accelerating-the-Mobilisation-of-Green-Capital.pdf |access-date=23 October 2026 |via=Climate Insights Directory}}

BibTeX

@techreport{burge2024role, author = {Burge, Lily and Van Coppenollle, Magali and Blagborough, Charlie}, title = {{The Role of Development Finance Institutions in Accelerating the Mobilisation of Green Capital}}, institution = {Climate Bonds Initiative}, year = {2024}, month = nov, url = {https://www.climatebonds.net/files/documents/publications/The-Role-of-DFIs-in-Accelerating-the-Mobilisation-of-Green-Capital.pdf}, urldate = {2026-10-23}, note = {Indexed by Climate Insights Directory} }