Tracking and Mobilizing Private Sector Climate Adaptation Finance

The Climate Policy Initiative (CPI) report 'Tracking and Mobilizing Private Sector Climate Adaptation Finance' introduces a new methodology and taxonomy to better track private sector investments in climate adaptation. By utilizing a bespoke taxonomy and a machine learning model, CPI increased the annual average of tracked private adaptation finance for the 2019-2022 period from USD 1 billion to USD 4.7 billion. The report identifies significant data gaps, particularly among insurers and pension funds, and highlights that the majority of tracked project-level investment is concentrated in the water and sanitation sector.

• CPI's new methodological approach, which includes a bespoke taxonomy and machine learning model, has increased the annual average of tracked private sector adaptation finance for the 2019-2022 period from approximately USD 1 billion to USD 4.7 billion.
• The report identifies a significant concentration of private project-level adaptation investment in the water and sanitation sector, specifically focusing on WASH (water, sanitation, and hygiene) services and the resilience of water management systems.
• Private sector adaptation finance is categorized by the likelihood of its relevance to adaptation: 5% is classified as high likelihood, 79% as medium likelihood, and 16% as low likelihood. Additionally, 27% of tracked finance is identified as having a potential for maladaptation or significant harm risk.
• Commercial banks are a major source of project-level adaptation finance, averaging USD 2.52 billion annually from 2019-2022, with a strong regional focus on East Asia and the Pacific.
• Venture Capital (VC) invested an annual average of USD 6.28 billion in adaptation-related companies between 2019 and 2022, with the Agrifood Systems theme dominating at 83% of all VC investment during this period.
• Annual consumer and household expenditures on products with a high adaptive likelihood are estimated to be between USD 48 billion and USD 61 billion, primarily for air conditioning and flood management infrastructure.
• Significant data gaps persist for certain institutional investors; specifically, no project-level adaptation finance was tracked for insurers or pension funds, making their actual contributions difficult to gauge.
• Corporations contributed an annual average of USD 1.93 billion in project-level investments from 2019-2022, primarily in water and sanitation infrastructure, though much of their total contribution likely remains underreported due to indirect investments in supply chains and internal upgrades.

APA

Connolly, J., Richmond, M., Wallock, W., Abraham, S., Chin, N., & Grant, C. (2024). Tracking and Mobilizing Private Sector Climate Adaptation Finance. Climate Policy Initiative. https://www.climatepolicyinitiative.org/wp-content/uploads/2024/09/Tracking-and-Mobilizing-Private-Sector-Climate-Adaptation-Finance-2024.pdf

Chicago

Connolly, Jake, Morgan Richmond, William Wallock, Sasha Abraham, Neil Chin, and Chris Grant. Tracking and Mobilizing Private Sector Climate Adaptation Finance. Climate Policy Initiative, 2024. https://www.climatepolicyinitiative.org/wp-content/uploads/2024/09/Tracking-and-Mobilizing-Private-Sector-Climate-Adaptation-Finance-2024.pdf.

Wikipedia

{{cite report |last1=Connolly |first1=Jake |last2=Richmond |first2=Morgan |last3=Wallock |first3=William |last4=Abraham |first4=Sasha |last5=Chin |first5=Neil |last6=Grant |first6=Chris |title=Tracking and Mobilizing Private Sector Climate Adaptation Finance |publisher=Climate Policy Initiative |date=September 2024 |url=https://www.climatepolicyinitiative.org/wp-content/uploads/2024/09/Tracking-and-Mobilizing-Private-Sector-Climate-Adaptation-Finance-2024.pdf |access-date=17 August 2026 |via=Climate Insights Directory}}

BibTeX

@techreport{connolly2024tracking, author = {Connolly, Jake and Richmond, Morgan and Wallock, William and Abraham, Sasha and Chin, Neil and Grant, Chris}, title = {{Tracking and Mobilizing Private Sector Climate Adaptation Finance}}, institution = {Climate Policy Initiative}, year = {2024}, month = sep, url = {https://www.climatepolicyinitiative.org/wp-content/uploads/2024/09/Tracking-and-Mobilizing-Private-Sector-Climate-Adaptation-Finance-2024.pdf}, urldate = {2026-08-17}, note = {Indexed by Climate Insights Directory} }