NH Investment & Securities has been selected as an accredited fund manager of the Green Climate Fund (GCF), becoming the first securities firm in Asia to receive this designation. As a result, NH plans to launch a climate technology fund (Climate Technopreneurship Fund, hereinafter CTF) with a target size of up to USD 200 million. We met with Kijung Kwon, Head of NH Investment & Securities’ Singapore office, to discuss the vision and strategy behind the initiative.

NH Investment & Securities has become the first Asian securities firm accredited as a GCF fund manager. How do you assess the significance of this achievement?

I believe this achievement goes beyond a simple business milestone. The Green Climate Fund (GCF), an international financial institution under the United Nations, is known for having one of the most stringent accreditation processes in the world. This selection represents international recognition of the ESG investment capabilities we have built over the past five years in Singapore, as well as our deep understanding of Asian markets. In particular, being the first Asian financial institution to receive this accreditation as of July 2024 is highly meaningful, and I believe it will also contribute positively to enhancing the global standing of Korea’s financial industry.

What would you say is the most innovative feature of the CTF?

It is our multi-strategy investment model. While traditional funds tend to focus on a single approach—such as loans, equity investments, or mezzanine financing—we employ all three simultaneously. In addition, the fund is structured with a first-loss commitment of up to USD 83.75 million from the GCF, which helps mitigate risks for private investors. This amount represents approximately 42% of the total target fund size, significantly strengthening investor protection.

The CTF is a representative example of blended finance, leveraging catalytic capital from international financial institutions such as the GCF to create an environment that encourages private sector participation. Through investments in global climate technology companies across Korea, Singapore, Australia, Japan, and the United States, the fund aims to generate carbon reduction and climate adaptation impacts, while facilitating technology transfer to five Southeast Asian countries—Indonesia, Vietnam, the Philippines, Cambodia, and Laos.

How did you determine the seven key investment themes?

We comprehensively reviewed national policies, technology supply and demand, and investment and exit feasibility. Based on this analysis, we selected seven core themes: renewable energy, energy storage, low-carbon transportation, energy efficiency, agricultural technology, water management, and waste management.

The portfolio will be constructed to reflect country-specific characteristics and industrial conditions. Agritech and water management, while relatively underrepresented in past investments, are critical areas for climate change adaptation.

What are the most important criteria in your investment decision-making process?

There are three. First is technological feasibility—no matter how compelling an idea may be, we cannot invest unless the technology has been properly validated. Second is market viability and scalability; the business model must be proven and capable of expanding within a growing market. Third is impact creation—we must be able to quantitatively measure carbon reduction and the number of beneficiaries.

The targets of 1.64 million tons of CO₂ reduction and 2.3 million beneficiaries are quite specific.

I believe the core of impact investing lies in measurability. Abstract goals make it difficult to persuade global institutional investors or to manage performance effectively.

The target of reducing 1.64 million tons of CO₂ was calculated based on projected scenarios for each invested company or project, applying UNFCCC Clean Development Mechanism (CDM) methodologies and key sub-criteria. The target of 2.3 million beneficiaries was calculated using the same approach, broken down into 1.18 million direct beneficiaries and 1.13 million indirect beneficiaries. These impact goals are set over a ten-year horizon and will be continuously monitored and verified as investments progress.

How do you evaluate the growth potential of Asia’s climate technology market?

Asia, particularly the ASEAN region, is expected to experience the fastest growth. While global climate technology investment is projected to grow at a compound annual rate of approximately 5% between 2021 and 2030, the ASEAN market is forecast to expand from USD 24 billion to USD 73 billion over the same period, representing annual growth of around 15%.

Major countries such as Indonesia, Vietnam, and the Philippines are actively pursuing carbon neutrality policies, improving the environment for private investment. For example, Indonesia has set a target to increase the share of renewable energy to 31% by 2030, which will require more than USD 10 billion in annual investment. Given the limitations of public funding, the role of private capital is becoming increasingly important.

What differentiates you from competitors?

Experience. NH Investment & Securities’ Singapore office has accumulated extensive expertise in overseas private equity and private debt investments. In addition, we can leverage the comprehensive financial capabilities of our parent company.

Through close collaboration with our carbon finance division, we have established aligned incentives across the entire investment process. We have also formed a dedicated global advisory platform, ensuring professional expertise from deal sourcing through post-investment management. Our partnership experience with the GCF is another key differentiator.

What kind of synergy does the partnership with GGGI create?

GGGI is a core partner in the management of the CTF. The Global Green Growth Institute is an international organization that supports green growth and carbon neutrality in developing and emerging economies. With a network spanning over 50 member countries, GGGI has implemented more than 260 climate technology-related projects.

This extensive network enables cooperation across investment sourcing, technology validation, and policy alignment with governments, public institutions, investment funds, and private organizations.

Do you see potential for Korea to become a climate finance hub in Asia?

Absolutely. Korea possesses strong capabilities in key climate technologies, including semiconductors, solar power, batteries, electric vehicles, biofuels, and agricultural technology. Geopolitically, it can serve as a bridge between Northeast and Southeast Asia, and the government has demonstrated strong policy commitment.

Initiatives such as the introduction of the K-Taxonomy, the expansion of green finance, and the New Southern Policy are closely aligned with our direction. I believe the selection of the CTF serves as an important example of Korea’s climate finance capabilities on the global stage.

Finally, what is the ultimate vision of the CTF?

Our goal is not merely to generate investment returns, but to contribute to the development of Asia’s climate technology ecosystem. We hope that the blended finance model of the CTF will become a reference point for climate finance in Asia, encouraging greater private sector participation in addressing climate change.

Over the next decade, we aim to achieve a reduction of 1.64 million tons of CO₂ and create benefits for 2.3 million people, contributing to Asia’s expanded role in the global response to climate change.