In response to rising carbon dioxide emissions in Asia, global impact firm responsAbility Investments AG (responsAbility), together with Germany’s development bank KfW and the Dutch development bank FMO, has launched a $500 million climate investment strategy.

The strategy aims to make an active contribution to carbon dioxide reduction in Asia through targeted investments in low-emission technologies and offers institutional investors attractive investment opportunities, responsAbility said in a statement on Tuesday.

According to the statement, Asia faces a double challenge: the continent is already the largest emitter of greenhouse gases, accounting for more than 50 percent of global carbon dioxide emissions, and is facing a projected strong increase in energy demand by 2050.

This underlines the urgent need to invest in climate-friendly technologies and infrastructure.

It is noted that responsAbility’s climate investment strategy focuses on sectors with high carbon dioxide savings potential in Asia, including renewable energy, battery energy storage, electric mobility, energy efficiency and circular economy.

A key element of the strategy is the innovative “Climate Impact Assessment and Monitoring Framework”, which ensures high transparency and targets direct carbon dioxide savings of an estimated 10 million tons over the entire lifetime of the investments.

ResponsAbility sees the climate investment strategy to have a positive impact on selected Sustainable Development Goals (SDGs), in particular climate action (SDG 13), industry, innovation and infrastructure (SDG 9) and responsible consumption and production (SDG 12).

It is also noted that responsAbility’s climate investment strategy uses a blended finance structure that combines public funding with private capital to support high-impact transformative projects.

The aim is to mobilize $500 million and involve a significant amount of private capital.

This blended finance approach will enable institutional investors to participate in solving Asia’s climate challenges while achieving an attractive risk-adjusted return on their portfolios.

“Our investment strategy appeals to institutional investors who are looking for both environmental impact and financial value from their investment,” said Ewout van der Molen, Head of Climate Finance, responsAbility.

“As a key step towards a low-carbon economy in Asia, responsAbility provides a significant opportunity for investors to make a tangible and measurable difference in the fight against climate change,

“The successful launch will enhance access to capital for Asian businesses that are keen to reduce their carbon footprint,” he added.

Meanwhile, KfW Global Equity and Funds Director Stephanie Lindemann-Kohrs said that KfW Development Bank, on behalf of the German Federal Ministry for Economic Cooperation and Development, strives to increasingly channel private sector capital into the SDGs.

“Through its blended finance structure and KfW’s investment into the first loss tranche, the climate investment strategy is ideally positioned to mobilize private funding at scale for investments that foster the energy transition and contribute to greenhouse gas abatement,” she added.

FMO Director Energy Marnix Monsfort, on the other hand, said that the firm is very pleased to participate in climate investment strategy as an anchor investor as they jointly accelerate the renewable energy transition in Asia.

“By providing energy solutions to various sub-sectors – commercial and industrial, energy efficiency, e-mobility, and battery energy storage – FMO endeavours to contribute and realize much-needed impact in climate action and attract much private capital in our energy transition journey,” he added.

ResponsAbility is a leading impact asset manager specializing in private market investments across three investment themes to directly contribute to the United Nations Sustainable Development Goals (SDGs): Financial Inclusion, to finance the growth of micro and small and medium-sized enterprises (SMEs); Climate Finance, to contribute to a net zero pathway; and Sustainable Food, to sustainably feed an ever-growing population.

All responsAbility investment solutions target specific measurable impact alongside market returns.

Since its inception in 2003, responsAbility has deployed over $14 billion in impact investments.

With over 270 employees collaborating across eight offices, as of October 1, 2023, the company manages $4.7 billion in assets across approximately 270 portfolio companies in 72 countries.

Since 2022, responsAbility is part of M&G plc, the international savings, and investments business, and contributes to enhancing M&G’s capabilities in impact investing.

Founded in 1948, KfW is the German promotional bank and one of the world’s leading promotional banks.

It is 80 percent owned by the federal government and 20 percent by the federal states.

The business sector KfW carries out financial cooperation (FC) projects with developing countries and emerging economies on behalf of the German federal government, especially of the Federal Ministry for Economic Cooperation and Development (BMZ).

KfW employs approximately 1,200 people at the head office in Frankfurt am Main and well 400 specialists at more than 60 international locations, who cooperate with partners all over the world.

Their goal is to combat poverty, secure peace, protect the environment and the climate as well as ensure fair globalization.

FMO is the Dutch entrepreneurial development bank.

As a leading impact investor, FMO supports sustainable private sector growth in developing countries and emerging markets by investing in ambitious projects and entrepreneurs.

FMO believes that a strong private sector leads to economic and social development and has a 50+ year proven track-record in empowering entrepreneurs to make local economies more inclusive, productive, resilient and sustainable.

FMO focuses on three sectors that have high development impact: agribusiness, food and water, energy, and financial institutions.

With a total committed portfolio of EURO 13 billion ($14.3 billion) spanning over 85 countries, FMO is one of the larger bilateral private sector development banks globally.

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