Tracking and Mobilizing Private Sector Climate Adaptation Finance

CPI has introduced a bespoke taxonomy and machine learning model to better capture private sector adaptation finance, increasing the annual average tracked flows from USD 1 billion to USD 4.7 billion for the 2019-2022 period. The analysis identifies significant gaps in reporting, particularly among insurers and pension funds, while highlighting that the majority of project-level private investment is concentrated in the water and sanitation sector. The report also estimates that annual consumer and household spending on high-adaptation-likelihood products ranges between USD 48 billion and USD 61 billion.

• The application of a new methodology and bespoke taxonomy increased the annual average of tracked private sector adaptation finance for 2019-2022 from approximately USD 1 billion to USD 4.7 billion.
• Project-level private adaptation investment is heavily concentrated in the water and sanitation sector, specifically WASH services, focusing on wastewater treatment, sanitation services, and industrial water reuse.
• Analysis of tracked finance shows that 79% of investments have a medium likelihood of being adaptation-relevant, 16% have a low likelihood, and 5% have a high likelihood. Additionally, 27% of tracked finance carries a risk of maladaptation or significant harm.
• Venture capital (VC) invested an annual average of USD 6.28 billion in adaptation-related companies between 2019 and 2022, with agrifood systems accounting for 83% of this investment.
• Annual consumer and household expenditure on products with a high likelihood of adaptation relevance is estimated to be between USD 48 billion and USD 61 billion.
• Commercial banks provided an annual average of USD 2.52 billion in project-level adaptation finance from 2019-2022, with investments heavily concentrated in East Asia and the Pacific.
• Corporations contributed an annual average of USD 1.93 billion in project-level investments from 2019-2022, primarily in water and sanitation infrastructure in non-OECD countries, particularly in East Asia and the Pacific.
• Significant data gaps persist for insurers and pension funds; no project-level adaptation finance was tracked for either institution type due to a lack of detailed reporting on capital allocation.

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

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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} }