The purity test that's killing clean energy | Riddhima Yadav

Global climate finance is currently stalled by a "transition trap" where investors prioritize perfection over progress, creating a binary view of investments as either purely green or grey. Finance innovator Riddhima Yadav argues that while the energy transition requires $3.5 trillion annually, current funding is insufficient because institutional investors fear the reputational and portfolio risks of engaging with high-emitting sectors. This exclusionary approach starves heavy polluters of the capital needed to decarbonize, potentially pushing them toward less climate-conscious investors. To bridge this gap, the financial sector must move beyond "purity tests" and embrace "50 shades of green," which includes buying out coal plants for accelerated phase-outs and supporting emerging markets with fewer strings attached. Rebuilding trust between the Global North and South is essential to unleashing the commercial opportunities of a clean growth economy and ensuring finance reaches every part of the global industrial landscape.