Risk to Reward 2025

A recurring theme in climate finance is the limited visibility of investment-ready mitigation and adaptation projects in EMDEs. Among 45 survey respondents asked to identify the top three barriers to climate investment, 37% cited this as the leading challenge. The second most common barrier was data gaps and lack of transparency, highlighted by 28% of respondents. In low- and middle-income countries, for example, there is an estimated pipeline of $1.2 trillion worth of sustainable infrastructure projects. However, achieving the sustainable development goals (SDGs) will require an additional $3.9 trillion annually.37 Limited visibility into projects that meet risk-return expectations This is not simply a matter of volume; rather, investors cite a pervasive lack of projects that meet the technical, financial and governance standards required for commercial investment. Climate investments in EMDEs are often too small or fragmented to attract institutional investors, who typically require larger ticket sizes to justify due diligence costs and internal resource allocation. This misalignment between capital requirements and projects could explain why some stakeholders argue that there are plenty of projects in the pipeline but not enough equity ready to be deployed. Data priorities for private climate investment decisions in EMDEs (% survey respondents) FIGURE 10 Data priorities What data would help you make better climate investment decisions in EMDEs?Respondent breakdown Composition by investor type of those who selected “Access to pipelines of bankable projects” 42%16% 16% 16%42%10% Other Corporates and strategic investorsBanks and financial intermediaries Institutional investors Asset managers and private marketsAccess to pipelines of bankable projects De-risking instruments Market- and sector-specific data Default risk and more granular data from the Global Emerging Markets Risk Database Non-financial data Other44% 35% 26% 23% 12% 9% Notes: Survey respondents could select multiple data types. Percentages in the bar chart represent the share of total respondents identifying each type as most useful. The pie chart illustrates the composition by investor type of those who selected “Access to pipelines of bankable projects” (n = 19). Source: KPMG analysis based on World Economic Forum survey. Improve access to bankable project pipelines PRIORITY 1 From Risk to Reward: Unlocking Private Capital for Climate and Growth 20