Switzerland-based impact investor responsAbility Investments AG has marked the second closing of its Asia-focused climate fund after securing a commitment from parent M&G plc.
M&G committed $100 million to the fund, taking the investment vehicle’s corpus to $200 million, responsAbility said in a statement. The fund aims to raise as much as $500 million for climate investments in Asia.
“Investing in emerging markets is crucial and this substantial allocation reflects our commitment to fostering sustainable development and economic growth in regions that are most vulnerable to the impacts of climate change,” said Ciaran Mulligan, CIO of Investment Management and Oversight, Prudential With-Profits Fund at M&G.
The Swiss investor marked the first close of the fund in November 2023 when it announced raising capital from the German development bank KfW and the Dutch development bank FMO. Separately, VCCircle reported in March that International Finance Corporation, the World Bank Group’s private-sector investment arm, planned to commit up to $100 million to the fund.
After the launch of the Asia-focused fund, responsAbility has already invested in green companies such as the ride-hailing company BluSmart, Amp Energy, and Farmart. The cumulative investment in these companies stands at around $70 million in India. So far in 2024, its biggest bet remains a $25 million infusion in BluSmart.
The Asia-focused fund has identified renewable energy, battery energy storage, electric mobility, energy efficiency, and the circular economy as its focus sectors. The Swiss investor has been raising a mix of public and private capital to support projects with high carbon emission reduction potential.
Asia is the largest emitter of greenhouse gases, accounting for more than 50% of global carbon dioxide emissions, and is facing a projected strong increase in energy demand by 2050. This makes the continent the go-to destination for investment, responsAbility said.
Founded in 2003, responsAbility broadly has three investment themes—financial inclusion, climate finance, and sustainable foods. It has backed Indian financial non-bank lenders such as Clix Capital, Electronica Finance, Annapurna Finance, and Kinara Capital, among others. M&G acquired responsAbility in January 2022.