Green Capital Alone Won't Save Climate Finance

While climate finance has largely been focused on mitigation and emissions reduction, Arthur Krebbers argues this is no longer sufficient. In his view, adaptation—preparing for climate-related shocks already unfolding—is critically underfunded and misunderstood. Just 10% of climate finance currently flows into adaptation projects, leaving markets dangerously exposed to physical risk.

Krebbers asserts that public financing, blended capital models, and early-stage venture funding are essential to bridge this gap and scale viable solutions.

What makes this conversation especially timely is its challenge to ESG orthodoxy. Krebbers notes that most risk models and sustainability KPIs are backward-looking, overlooking the projects and companies poised to make the biggest impact. Instead, he advocates for forward-looking AI-powered risk analytics and outcome-based KPIs tied to real-world resilience metrics, not just emissions avoided. His call to action? Financial institutions must move beyond green bonds and risk-averse portfolios to actively shape the climate future, not just react to it.