Ridhhima Yadav

Climate finance finds itself in a confused position today.

in 2025.

It is viewed as insufficient by many, as a niche by mainstream finance, and as elusive by everyone else.

And yet, financing a clean growth economy relies entirely on the real money.

Today, we are investing a little over a trillion dollars every year globally in the energy transition.

By our best estimates, we need that number to rise to 3.5 trillion every year between now and 2050.

Why is there a gap?

As a financier and an investor myself, I've been at the heart of how financial institutions and institutional investors, including sovereign wealth funds, asset managers, asset owners and banks, think and act on the clean energy transition.

And I believe there is one major fault line in global climate finance.

We have prioritized perfection over progress by painting entire swaths of sectors, industries, companies and countries in purely binary terms of gray or green.

But as we all know, there are 50 shades of green.

And we need to work with them all if we have to solve this challenge at speed and scale.

And yes, that means that the money must flow, not just to clean solutions, but also and specifically to heavy polluters and emerging markets.

And yes, we are not going to solve the climate challenge through purity tests.

The developed world committed $100 billion for the developing world to facilitate the clean energy transition annually.

That goal was achieved 13 years later.

That time has broadly become symbolic in addition to that goal itself of our inability to finance the transition at the speed and scale needed.

By contrast, governments all over the world allocated 10 trillion with a T in COVID economic stimulus in two months.

Did we spend years or months coming up with what COVID finance means?

Did we create standards, working groups, taxonomies, frameworks, definitions?