The recent investment sees the fund managed by the Swiss impact investor surpass $410m at fourth close with the aim of reaching a final close of $500m by year’s end.
ResponsAbility’s Asia Climate Strategy fund has reached fourth close of $414m with a $50m commitment from the International Finance Corporation (IFC).
The fund, which is focused on low-carbon investments across Asia, aims to reach final close of $500m by the end of the year. Impact Investor reported on the fund’s third close in January this year.
The fund employs a blended finance structure, leveraging public sector capital to catalyse private sector investment, an approach which has been successful in attracting $200m in private sector commitments to date.
It aims to invest into sectors with high CO₂ reduction potential, including renewable energy, battery storage, e-mobility, energy efficiency, and circular economy solutions.
The IFC, which has invested in the fund’s senior tranche, said the investment was well-aligned to its strategic objective of decarbonising the energy and transportation sectors in the Asia region by supporting investments in renewable energy generation, electric mobility and other climate technology solutions.
Allen Forlemu, regional industry director of the Financial Institutions Group, Asia Pacific at the IFC, said: “Our investment in the responsAbility Asia Climate Strategy demonstrates IFC’s commitment to supporting innovative structured debt fund solutions that mobilise private capital at scale to accelerate sustainable growth.”
Focus on Asia
Responding to questions from Impact Investor responsAbility company spokesman Richard Rogers said the Asia Climate Strategy was one of three funds responding to its core investment theme of climate finance. The company’s other core themes are financial inclusion and sustainable food.
He said that moving to a 1.5C pathway requires stronger ambitions and accelerated implementation, especially in Asia.
“The region today emits over 50% of global greenhouse gases making it central to the success of global decarbonisation efforts. With 85% of the Asia-Pacific (APAC) energy mix still fossil-based and nearly 60% of the projected growth in global power demand over the next two decades expected to come from the region, the urgency of transition cannot be overstated,” he said.
Rogers, who said that the fund would invest primarily in emerging markets across the Asia-Pacific region, explained that rapid industrial growth, rising energy needs, and coal-intensive systems have made Asia both a leading emitter and a critical lever for change.
“At the same time, public health impacts are mounting. APAC is home to some of the world’s most polluted cities. Of the 100 cities with the worst air quality, 93 are in Asia,” he said, adding that industrial emissions and fossil-fuel powered vehicles are major contributors and that in India alone prolonged exposure to polluted air was contributing to 1.5 million deaths annually.
“To address these challenges, responsAbility launched the Asia Climate Strategy. The fund aims to mobilize private institutional capital to achieve measurable greenhouse gas emissions reductions at scale,” he added.
The fund will allocate up to 45% of its portfolio to India over the long term, with Rogers confirming that no single other target country would exceed 25% and that the fund would maintain a strategic focus on South and Southeast Asia.
Investments to date
The fund aims to have 15 to 20 portfolio holdings when fully invested and Rogers confirmed it had made approximately 12 investments to date, including into August Energy, which focuses on decentralised energy infrastructure for commercial and industrial (C&I) clients in India and Southeast Asia, including rooftop solar and integrated utility services such as cooling-as-a-service and steam-as-a-service solutions.
Other holdings include KIS Group, a Singapore-based company that provides sustainable clean technologies for the waste-to-energy and related sectors, and Euler Motors, an Indian manufacturer of electric three-wheeler and four-wheeler commercial vehicles designed specifically for urban goods transportation.
Rogers said all investments are assessed and monitored by a climate impact framework, which tracks impact cross four dimensions, including outcomes directly attributable to project activities, such as installed solar capacity, broader ecosystem effects from enabling infrastructure, such as EV charging networks, outcomes already achieved, and forward-looking projections based on conservative estimates.
He said that based on current pipeline projections, the fund is expected to help avoid approximately 16 million tonnes of CO₂ emissions over the lifetime of its investments.
