By Tiffany Qin Ting, CFA, Senior Manager, Investor Liaison
The gap between climate ambition and action remains significant, and nowhere is it potentially more consequential than in Asia.
Every year, the world’s green finance community meets in Singapore for Ecosperity Week. This year’s discussions reinforced the increasingly critical challenge the region faces: we know what’s needed to accelerate the Asian transition, we broadly have the tools to do it, and yet the money is still not flowing at the required rate.
About three-quarters of Asian investors now recognise climate change as a financial risk and opportunity, and yet only 22% have published formal transition plans. That is a credibility rather than a knowledge problem. Fixing it will, to a large degree, determine Asia’s future resilience and prosperity.
The region faces distinct challenges, and the conversations at Ecosperity made it clear that investors are not satisfied with vagueness or ambitious long-term targets that are paired with incoherent capital allocation. Do corporate 10-year plans match what is being spent or allocated today? For most companies, the answer is no.
This matters for individual companies, sectors, and entire economies. The high-emitting businesses that most need transformation — power generation, heavy industry, shipping — are precisely where capital deployment is most difficult and most necessary. Unlocking that capital requires plans that are not just credible in ambition but bankable in structure, and a system-level approach supported by radical collaboration, rather than isolated, project-by-project efforts.
Adaptation remains severely underfunded, despite rapidly growing physical climate risks. Those risks are still underpriced and poorly understood, partly because companies and investors lack access to reliable, asset-level data, practical assessment tools, and clear benchmarks for what good adaptation practice looks like.
Companies also tend to see adaptation as a cost rather than an investment in a future “resilience dividend”. Consequently, they often underestimate the competitive benefits of reducing future operational disruptions, supply chain failures, insurance losses, and impacts on revenue.
There are reasons for genuine optimism. Renewable energy costs have fallen further and faster than expected, and Asia now accounts for the majority of global renewable deployment, despite external pressure on governments to bake fossil fuel commitments into trade deals. Technology is doing some of the work that policy has so far failed to do. And there are areas — methane abatement in particular — where cheap, available solutions are simply waiting to be implemented at scale, offering near-term emissions reductions while longer structural transitions are built.
But technology alone will not be enough. Grid infrastructure and utility-sector reform are critical but often overlooked enablers, and inadequate investment in transmission and distribution threatens to become a major bottleneck to renewable integration. State-owned utilities, underfunded and often undervalued by climate finance frameworks, need financial, technical, and political support.
Perhaps the most striking shift in thinking this year was on policy advocacy. Climate-committed investors are no longer content to manage their portfolios and hope governments catch up. Advocacy disclosure among major Asian institutional investors has tripled in two years. This is a recognition that the transition cannot be delivered project by project but requires system-level change.
Asia is not behind on climate. In many respects, it is where the transition will be won or lost. What the region needs now is less ambition and more architecture — credible plans, investable structures, and the political will to build the infrastructure that makes all of it possible.
The capital exists. The question is whether the conditions to deploy it will be created in time.
