GAIA Fund
- Investor: GAIA, Pollination (climate impact advisor), Climate Fund Manager
- Source of finance: FinDev Canada & MUFG (founding cornerstone investors), Green Climate Fund. Established 2024, Target fund size $1.48 billion, 30-year fund term, 15-year investment period
- Financial instrument: Long term debt finance, Tiered capital structure (senior tranche, junior tranche (first loss facility), guarantee/insurance facility) plus Technical Assistance Facility, Hedging Facility & Reserve Account
- Sector: Climate adaptation (70% minimum), Climate mitigation (up to30%)
- Geography: Emerging market economics, including Small Island Developing States
GAIA aims to contribute to a paradigm shift towards a more sustainable and inclusive economy by making available to recipient countries an innovative blended finance platform, which will mobilize capital from institutional investors towards climate projects.
GAIA works in key areas critical to the climate transition:
- Energy generation and access
- Low emission transport
- Health
- Food and water security
- Infrastructure and the built environment
- Ecosystems and ecosystem services.
Around 70% of finance is intended for projects relating to climate resilience risk management and 30% to emissions reduction.
The GAIA Fund Platform provides opportunities for participating countries to broaden the range of climate finance tools available to them and significantly expand the availability of both implementation finance (flexible long-term loans in local or hard currency without the mandate of a sovereign guarantee), technical assistance and knowledge sharing in the countries in which the fund operates.
GAIA Fund is an Article 9 Fund which means it has a primary sustainable investment objective, invests in companies that align with the EU taxonomy for environmentally sustainable activities and reports on its sustainability impact and sustainability risk. It provides long term debt finance through structures that derisk projects through blended finance approaches.
The GAIA Fund measures its impact using measures such as Reduction GHG emissions, resilience of physical assets, ecosystems and populations; increase in number of jobs (including for women) contributing to sustainable and economic growth; enhanced capacity of project leaders to access and mobilize climate finance and to address risks.
Final Insights
The GAIA Fund demonstrates a creative solution using blended finance approach to enable long term debt finance to help fund climate mitigation and climate adaptation projects in emerging markets.
Through concessional capital and guarantees alongside institutional capital, it is unlocking climate finance.
View the full case study by CDPQ, Sustainable Markets Initiative & Investor Leadership Network (2025).
Private Capital
The providers of private capital into blended finance transactions are usually investors with more flexibility and a higher risk appetite than institutional investors. This form of capital enables projects to build and scale up.
Sustainability for Strategic Advantage
Strategy & Transformation
Sustainability for Strategic Advantage
A one-day program for senior and mid-level executives, this course is distinct in approaching sustainability as a strategic issue, with a particular focus on climate change.