BETTER FINANCE today published its pioneering assessment of whether individual investors in Europe can meaningfully invest in publicly listed climate-solution companies based in low- and middle-income (LMI) countries. The study highlights a striking gap between European investors’ willingness to support climate action abroad and the actual investment channels available to them.
LMI countries are responsible for around 75% of global emissions, yet receive less than 15% of global climate finance. In this context, BETTER FINANCE examined whether the market provides European savers with effective opportunities to invest in climate-positive solutions, particularly those targeting the Global South, and whether such capital can be channelled to where it is most urgently needed.
The report examines the real-world accessibility of listed equity, theoretically the most accessible asset class for individual investors, across France and Germany. It maps publicly listed companies delivering climate solutions in Global South economies, cross-checks their availability via European UCITS products, and reviews the indices that form the core of most European investment offerings.
Limited access despite growing investor demand
The study finds that European retail investors have very limited practical access to publicly listed climate-solution companies in low- and middle-income countries. In both France and Germany, actively managed funds with emerging or global mandates tend to closely follow standard benchmarks, resulting in heavy concentration in a small number of large emerging economies, particularly China and South Africa. Even where fund managers have discretion, this is rarely used to expand exposure to the wider Global South, and none of the analysed funds held companies identified as climate-solution leaders in the Carbon Collective universe.
Direct equity access remains minimal, with retail platforms focused mainly on domestic, European and US stocks. Only a handful of Global South companies are available through secondary or cross-listings on European exchanges, and just one of these meets recognised climate-solution criteria. ETFs offer broader coverage but remain dominated by index exposures to a narrow set of markets, with Latin America largely limited to Brazil and virtually no pan-African exposure beyond South Africa. Overall, fewer than 200 distinct climate-solution companies from the Global South are accessible through the products available to European individual investors today.
A missing pathway for willing investors
Despite the significant pool of individual and institutional capital in high-income countries, the study suggests that the pathway connecting European investors to climate-solution firms in emerging and frontier markets remains limited, fragmented, and often opaque. The findings underline a clear disconnect while the investment universe in these countries is large and diverse, European individual investors frequently cannot access it through the products available to them today.
Policy and industry action needed
BETTER FINANCE calls on policymakers, market participants, and index providers to work together to expand and clarify access. Doing so would not only unlock new funding for climate solutions where they matter most, but would also enable European savers who wish to see their investments contribute to the green transition beyond Europe’s borders to do so more effectively.
“Many European savers are interested in putting their money to work for the global climate transition, but our findings show that the market simply does not offer them clear or effective ways to do so,” said Aleksandra Mączyńska, Managing Director of BETTER FINANCE. “If policymakers, index providers and asset managers are serious about mobilising private capital for climate action in the Global South, they must ensure that accessible, transparent and genuinely diversified investment products are available to individual investors across Europe.”
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