“Does anyone here believe that we are in a position where we need to be to win the battle? The answer is no.” Departing US Special Presidential Envoy for Climate John Kerry drove home this hard truth during a climate financing panel at Davos 2024, which is why social investors play an even more critical role in getting us a fighting chance in today’s climate crisis through climate adaptation technologies.

Climate financing has always been at the top of any global sustainability agenda, given how it is a crucial component for countries to go from mapping strategies and targets to taking committed action. This is no small sum – a staggering US$5 trillion of capital is needed each year by 2050 for us to meet climate goals. This is even more pertinent here in Asia for several reasons – not only does the region generate the largest share of emissions globally, but it is also the most exposed to extreme weather events.

Meanwhile, climate adaptation technology advancements to both mitigate and adapt to climate change have been moving in leaps and bounds. Communities can better adapt to droughts and floods with the help of climate-smart agriculture, while intelligent weather prediction tools help protect infrastructure and human lives from storms, floods, and heatwaves.

However, the investment needed to scale these climate adaptation technology innovations remains insufficient and unevenly distributed, with the focus largely on emission reduction efforts, and funds disproportionately benefiting high-income countries in Europe, the US, and Canada.

Turning Risk Into Opportunity with Climate Adaptation Technologies

This imbalance in climate adaptation technology financing is due to several barriers, such as high upfront costs, perceived risks and uncertainty, lack of established commercial markets, and limited access to knowledge of the opportunities.  In turn, the widening gap between rising adaptation costs and limited financing leaves at-risk countries in the region severely under-resourced.

Social investors – investors who combine financial returns with social impact by backing companies and funds with a social purpose – are in a unique position to step in. To achieve the progress we need to see with climate action, social investors’ active role in climate financing is vital, bringing to the table not only a unique risk tolerance needed for adaptation financing but also providing value beyond financial support through impact-focused alliances.

Read the full article about climate adaptation technologies by Aravindan Srinivasan at Jakarta Globe.