Accelerating Impact Investments for Climate and Nature in Asia 2025

Executive summary The Sustainable Development Goals (SDGs) face a daunting yearly funding gap of $4.2 trillion in developing countries,1 hindering progress on essential climate, environmental and social issues. To meet these challenges at scale and pace, radically more effective and efficient financial mechanisms must be employed. Impact investing presents a promising solution, particularly in Asia, which is home to some of the world’s most critical climate and nature challenges while, in parallel, offering significant opportunities for transformative change.This insight report, based on market data, case studies and expert interviews, demonstrates how impact investing can unlock the financial capital needed to address these pressing issues while also delivering returns on investment. All experts interviewed agreed that urgent action is needed in Asia, but emphasized that climate and nature challenges are a global issue that requires shared solutions.Multistakeholder collaboration is vital to scale impact investing, de-risk investments and deliver sustainable triple-bottom-line returns. There is a greater sense of urgency in terms of climate and nature action in Asia, particularly because it is the geographic part of the world where we have the most climate-related disasters than anywhere else. Sector expert, July 2024 Asia, compared to Europe and North America, has a relatively nascent impact investing market. However, interest in the region is growing, driven by the diverse opportunities for climate and nature solutions. Early movers are introducing innovative blended financial structures that reduce risks and improve the bankability of investments, helping attract more capital to the region. Despite this, challenges remain, including market immaturity, limited data and perceptions of high risk, which complicate the identification of quality investment opportunities that promise measurable positive impacts and financial returns. This report outlines how collaboration across public, private and philanthropic sectors is crucial to overcoming these barriers. By harnessing the strengths of each sector, these partnerships can create sustainable financial structures that unlock additional private capital, making investments more scalable, replicable and attractive. These collaborations generate win-win outcomes across the triple bottom line – environmentally, socially and economically – while helping to pool resources and increase investment flows. To accelerate the growth of impact investing in Asia, the report concludes with a forward-looking roadmap. Drawing from expert insights, successful case studies and lessons learned, it offers actionable steps for practitioners and other key stakeholders to address the identified challenges and unlock the full potential of impact investing in solving some of the world’s most urgent climate and nature crises. Accelerating Impact Investments for Climate and Nature in Asia 4