Standard Chartered’s latest Sustainable Banking Report 2023 shows $17 billion of retail investor capital could be mobilized towards climate investments in Malaysia by 2030.

The bank said in a statement on Thursday that within climate investing in Malaysia, $9 billion could flow into mitigation themes – renewables, energy efficiency and storage are set to attract the most capital.

Meanwhile, $8 billion could be mobilized towards adaptation including resilient infrastructure, biodiversity, and food systems.

The survey also showed 93 percent of investors in Malaysia are interested in climate investing, and 83 percent of them want to increase capital flows towards climate.

They are mainly motivated by social norms, personal values, wanting to improve investment returns and to reduce portfolio risks.

However, multiple barriers, which vary by investor segments, are holding them back from translating their interest into investment.

66 percent citing comprehensibility and 63 percent noting comparability as significant challenges in climate mitigation and adaptation investments.

Standard Chartered said these findings demonstrate how the industry plays a critical role in helping investors overcome these barriers to unlock potential of retail capital.

It said a concerted effort is required by financial institutions, regulators, companies, and individuals, to establish a wider range of climate assets to drive greater retail participation.

The report also shows the need of clear action from asset managers and banks to work towards innovating new climate assets to match emerging investor interests, such as biodiversity and the blue economy.

It also sees the need for financial institutions to mobilize retail capital via three pillars – empowering investors with information, product customization and outcome-based information.

It also sees the need for digital and fintech solutions to play an enabling role and simplify processes for investors.

The industry across the world is also needed to align reporting standards and mandate minimum disclosure requirements to boost investor confidence.

“Financing presents both a critical challenge and opportunity in combatting climate change,

“Our research reveals that comprehensibility is a common barrier among Malaysian investors, drawing attention to the need for the industry to empower investors with information about climate investing and debunk common myths,” said Sammeer, Managing Director and Head of Consumer, Private and Business Banking at Standard Chartered Malaysia.

In overcoming the current disconnect between investor interest and the scale of climate investments, he said the industry needs to improve access to solutions, harmonize reporting standards and measurement of impact.

The research – based on investor interest from a survey of 1,800 respondents in ten growth markets across Asia, Africa and the Middle East – identifies a global potential of $3.4 trillion for climate investing, highlighting the power of individuals to combat climate change.

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