The climate crisis disproportionally affects poor people in developing countries and is a major threat to the goal of eradicating poverty. Norfund’s climate position outlines the way in which Norfund intends to invest in a clean and climate-resilient future in developing countries.

In September 2020, Norfund adopted a new climate position. The position describes the way in which Norfund works to limit and reduce greenhouse gas emissions, the way we handle climate-related risk and opportunity and the way we support businesses and communities that must adapt to a changing physical climate and to a low-carbon future. 


tonnes CO2 emissions avoided by investments in total portfolio in 2020


tonnes CO2 emissions avoided annually by all greenfield renewable plants Norfund has supported since inception

Norfund contributes to avoiding emissions, mainly by investing in renewable energy. In 2020, our investments in clean energy contributed to avoiding 5.4 million tons of CO2 equivalents. (Calculated using the harmonized IFI approach: «GHG Accounting for Grid Connected Renewable Energy projects» (2020))

However, our investments may also contribute to increased emissions, directly or through the supply chain.

Changes in climate expose our investments to increased physical climate risks – both acute (e.g. floods, droughts, cyclones) and chronic (e.g. changes in temperatures and weather patterns, sea-level rise) – that need to be assessed and managed. Transition risks resulting from political and technological changes to combat climate change may also affect the profitability and viability of our investments.

Our position builds on three pillars: resilience, reduction and risk, as illustrated in the diagram below.

We build our climate position on three pillars


By resilience, we mean the capacity of individuals, economies and societies to cope with the effects – physical and economic – of climate change. Job creation and economic development enables such resilience.

Norfund’s contribution: The poor and vulnerable are the most affected by climate change. Norfund’s priority to the Least Developed Countries (LDCs) and job creation helps make these groups more resilient to climate change.


By reduction, we mean reducing or avoiding emissions to enable the transition to an energy system aligned with the Paris Agreement.

Norfund’s contribution: By investing in renewable energy, Norfund helps avoid emissions and facilitates the transition to a low-carbon economy. We also enable access to clean energy. Having signed up to the EDFI climate statement, Norfund will will align all new investments with the objectives of the Paris Agreement by 2022 and transition the total investment portfolio to net zero GHG emissions by 2050 at the latest.


By risk, we mean the physical risks, such as flooding, drought and cyclones, and transition risks, such as policy, technology and reputational risk, that impact companies. These risks can also be turned into opportunities.

Norfund’s contribution: By assessing material climate risks (physical and transition) and opportunities for our investments, we help our investees succeed.

To deliver impact on each of these pillars we take four sets of strategic actions:

1. We invest in climate solutions

Clean Energy is Norfund’s largest investment area, and over time, we invest at least half of the capital allocated by our owner in renewables. In the strategy period 2019-2022, our ambition is to develop 5,000 MW new capacity, of which 4000 MW is renewable.

We are also expanding into investments in waste management, water solutions and electric transmission and distribution. These investments will contribute to reduced emissions as well as improved climate resilience in our markets.

2. We avoid fossil fuels

We exclude investments in oil and coal. We also exclude investments in gas, except gas-fired power where it supports an energy transition aligned with the Paris Agreement. From 2030 new investments in gas-fired power will generally be excluded.

3. We integrate climate across investments

We act as a responsible owner by building awareness and capacity in our investees to manage climate impact, reduce financial risk and seize climate-related business opportunities where relevant

4. We build climate resilience

We enable climate change adaptation for people and communities by investing in Least Developed Countries and Sub-Saharan Africa, which are the most vulnerable and least prepared to tackle the effects of climate change.