KWAP Launches RM2 Billion Climate Fund Dana Iklim+

Malaysia’s largest public sector pension fund, Kumpulan Wang Persaraan( KWAP), has launched a new RM2 billion($ 475 million) climate- concentrated investment vehicle named Dana Iklim, aimed at backing systems and companies that accelerate the country’s transition toward a low- carbon and climate- flexible frugality. The fund was officially unveiled at the Kuala Lumpur Sustainability Summit 2025 and marks Malaysia’s first devoted climate investment platform driven by an institutional investor.

The launch was officiated by Datuk Seri Johari Abdul Ghani, Minister of Plantation and Goods and acting Minister of Natural coffers and Environmental Sustainability. Speaking at the event, Johari stressed that Dana Iklim demonstrates how Malaysia’s capital requests can be used as a force for climate adaptability and inclusive growth. He emphasized the significance of public-private hookups in achieving Malaysia’s public target of net- zero hothouse gas emigrations by 2050.

KWAP, which manages withdrawal savings for Malaysia’s public sector workers, is one of Southeast Asia’s most influential institutional investors. The establishment of Dana Iklim reflects KWAP’s broader strategy to integrate climate considerations into its investment opinions and support Malaysia’s National Energy Transition Roadmap. It also aligns with the Madani Economy Framework and the Ministry of Finance’s GEAR- uP action, both of which prioritize sustainable and inclusive growth.

According to KWAP Chief Investment Officer Hazman Hilmi Sallahuddin, the fund will borrow amulti-asset strategy designed to induce both fiscal returns and measurable environmental issues. Dana Iklim will emplace capital across four crucial areas — structure, private equity, real estate, and nature- grounded results. These investments are anticipated to contribute to emigrations reductions, resource effectiveness, and broader climate adaptability. KWAP systems that through its portfolio, the fund could help avoid or alleviate up to one million metric tons of carbon dioxide fellow over its investment horizon.

“ Dana Iklim is an integral part of our strategy to advance Malaysia’s transition to a low- carbon frugality, ” Hazman said. “ As a responsible institutional investor, we're mobilising capital to drive real environmental impact and long- term sustainable growth. ”

The fund’s structure is grounded on a performance frame that measures issues across six impact confines, including climate adaptability, alignment with public programs, and benefactions to the United Nations Sustainable Development Goals( SDGs). By linking investment issues to measurable performance pointers, KWAP aims to enhance responsibility, translucency, and investor confidence while attracting fresh private sector participation.

The “ ” in Dana Iklim signifies that its focus extends beyond decarbonisation alone. The fund’s accreditation also includes investments that induceco-benefits similar as perfecting food security, icing access to clean water, expanding renewable energy structure, and promoting inclusive profitable openings. This broader approach underscores KWAP’s view that believable climate action must address connected social and environmental objects.

“ A believable climate strategy must address connected development pretensions, ” Hazman noted. “ Through this fund, we aim to invest in results that produce lasting value for Malaysia’s future — not only through emigrations reduction but through participated substance. ”

Dana Iklim is KWAP’s third catalytic action after Dana Pemacu and Dana Perintis, both designed to strengthen Malaysia’s private- request ecosystem. With this new fund, KWAP is placing climate action at the centre of its investment docket, buttressing its own institutional thing of achieving a net- zero investment portfolio by 2050.

The launch also signals Malaysia’s growing part in the indigenous sustainable finance geography. As other Southeast Asian husbandry increase their focus on energy transition and green growth, Dana Iklim provides a model for mobilising institutional capital toward scalable, performance- grounded climate results. It complements being public fabrics similar as Bank Negara Malaysia’s Climate Change and Principles- Grounded Taxonomy and Bursa Malaysia’s ESG reporting norms, which aim to standardise sustainability exposures and encourage responsible investment.

Institutional investors across the region are gradationally shifting their portfolios toward climate- aligned means, recognising that environmental sustainability and fiscal stability are decreasingly intertwined. KWAP’s move reflects this broader indigenous trend and may inspire analogous enterprise among pension and autonomous finances in neighbouring countries.

By targetingmulti-asset investments in renewable energy, green structure, real estate, and conservation- grounded systems, Dana Iklim seeks to demonstrate that climate- acquainted investments can deliver competitive fiscal returns alongside measurable environmental impact. The fund’s model of combining climate performance criteria with fiscal responsibility could set a precedent for unborn public-private climate finance collaborations in Southeast Asia.

still, KWAP’s Dana Iklim could help close the backing gap that has long hindered the region’s low- carbon transition, If successfully enforced. More importantly, it could support Malaysia’s leadership in sustainable capital mobilisation and show how institutional investors can play a decisive part in driving climate-positive profitable growth.

Through this action, Malaysia takes another step toward erecting a climate- flexible, inclusive frugality — one where long- term substance aligns with environmental responsibility.