Climate Fund Managers (CFM)

Climate Fund Managers (CFM) is a pioneering investment firm dedicated to mobilizing private capital for climate adaptation and mitigation projects in emerging markets. Established with a clear mission to address the critical funding gaps in climate resilience, CFM focuses on innovative blended finance solutions that combine public and private resources. By leveraging partnerships with institutions such as the European Union and Sanlam Investments, CFM aims to create sustainable investment opportunities that yield both financial returns and positive environmental impact.

The firm’s flagship fund, Climate Investor Two (CI2), recently achieved a significant milestone by closing at USD 1.065 billion, exceeding its target and setting a new standard for climate adaptation financing. CI2 is strategically focused on sectors such as water, waste, and oceans infrastructure, primarily across regions in Africa, Asia, and Latin America. These regions have been identified as critical areas where investment in climate resilience is urgently needed, yet often underfunded.

CFM employs a dual-fund structure within CI2, which includes a Development Fund that provides concessional support to de-risk early-stage projects and a Construction Equity Fund that caters to varying risk-return profiles as projects transition from development to construction. To date, CI2 has committed approximately USD 339 million to 25 climate adaptation and mitigation projects, which encompass initiatives such as water supply systems, desalination plants, and waste-to-energy projects. Notably, one of its landmark projects includes a debt-for-nature exchange in Ecuador aimed at marine conservation.

One of the innovative features of CI2 is its Bridge-to-Bond mechanism, which facilitates the refinancing of assets through climate bonds, thereby enhancing the accessibility of private capital for green projects in frontier markets. This mechanism is supported by a strategic partnership with Sanlam Investments and a guarantee from the European Commission, ensuring robust governance and risk management practices are in place.

Looking forward, CFM is poised to continue its momentum with the launch of CI3, which has a target range of USD 750 million to USD 1 billion. This new fund will focus on expanding investment in energy transition technologies, including green hydrogen, further solidifying CFM's role as a leader in mobilizing private capital for impactful climate solutions.

CFM’s approach underscores a broader shift in the investment landscape towards blended finance models that integrate public policy with private investment to accelerate climate resilience in challenging markets. By delivering safe drinking water and improved sanitation while simultaneously protecting ecosystems, CFM is making a significant contribution to sustainable development and climate adaptation.