Publication Type

Report

Version

publishedVersion

Publication Date

3-2024

Abstract

Efforts to address climate change have generally been focused on deploying mitigation technologies. However, it is adaptation technologies (and climate risk transfer) that will have to gain an increasing share of an investment pool dedicated to climate if human systems are to stay resilient to climate forces. Just like mitigation projects, adaptation projects have a strong public goods aspect, wherein public returns exceed private returns, and thus call for the state’s involvement. We argue that sovereign climate funds (SCFs) - new types of sovereign wealth funds with a climate investment mandate - can be critical purpose-built conduits especially for undertaking the needed decades-long programs of allocating resources to adaptation projects, without hindrance from political biases or “short-termism”. They can also function as “cushions” against potential future climate funding shortfalls and dispense payouts when climate disasters strike. We discuss the various climate-related adaptation investments that SCFs would be particularly well-suited to undertake.

Keywords

Investment, climate change, sovereign climate funds, sovereign wealth funds

Discipline

Business Law, Public Responsibility, and Ethics | Finance and Financial Management | Portfolio and Security Analysis

Research Areas

Finance

First Page

1

Last Page

20

Publisher

Singapore Managment University, Sim Kee Boon Institute for Financial Economics

City or Country

Singapore

Embargo Period

4-1-2024

Copyright Owner and License

Singapore Management University

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