Assessing the Quality of Adaptation Finance is an interactive decision-support tool developed by the Climate Policy Initiative (CPI) to help public finance providers evaluate the quality of climate adaptation finance interventions. The tool is accompanied by a report providing methodological guidance, illustrative examples, and supporting analysis, including assessments of adaptation-tagged ODA, adaptation finance and sovereign debt sustainability, and a case study applying project- and market-level criteria.

Organisation behind the tool
The tool was developed by CPI (Climate Policy Initiative), a global policy and finance research organisation focused on climate finance tracking and sustainable development outcomes.

What the tool does
The tool assesses interventions across three levels — project, market, and system — using a three-stage rating framework: Initial (not yet engaging meaningfully with a criterion), Progressing (core elements in place but with gaps), and Transformative (ambitious, evidence-based, and delivering durable outcomes). It covers four public finance instrument types: grants, debt, equity, and risk-transfer tools (including guarantees and insurance). At the project level, criteria include climate risk identification and integration, alignment with national and subnational adaptation priorities, target population access and reach, adaptive management and learning design, and minimisation of maladaptation. Market-level criteria address business model viability, replication and scale-up, adaptation solution diffusion and innovation, demonstration effect on risk-return profiles, and market-level maladaptation. System-level criteria cover debt sustainability and fiscal risk, investor attitudes and investment patterns, policy and regulatory enabling environments, supply chain and indirect beneficiary climate resilience, and systemic maladaptation risk.

Target audience
The tool is primarily designed for public finance providers — including development finance institutions (DFIs), bilateral donors, and government finance bodies — who must allocate scarce resources strategically to maximise adaptation and development outcomes. Researchers and policymakers working on climate finance tracking may also find the accompanying report and methodology relevant.

Relevance to finance professionals
The tool does not produce comparative benchmarking but identifies strengths and surfaces gaps to support better decision-making over time. Each project is assessed against the tool’s criteria across instrument types, offering structured guidance on how to design, monitor, and improve adaptation finance interventions. It is particularly relevant for professionals engaged in impact investment, concessional finance structuring, ESG integration in public portfolios, and climate risk assessment within sovereign and infrastructure finance contexts.