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Tideline, founded in 2014, is a specialized impact investing consultancy that has helped shape industry standards. The firm has pioneered key concepts such as “catalytic capital” and “impact verification,” completing over 200 projects, many in Asia, and influencing clients managing US$13.5 trillion in assets.
The Asset ( TA ) recently spoke to one of Tideline’s co-founders Ben Thornley ( BT ) who leads the firm’s strategic and impact management advisory practice. Thornley has advised over 60 institutional investors on integrating impact and sustainability across the investment process.
TA: How has impact investing in Asia evolved in recent years, and what key trends should investors be paying attention to in 2025?
BT: Impact investing in Asia has grown significantly, shifting from a niche concept to a key pillar of sustainable finance. Five years ago, few major banks in Asia had dedicated impact funds. Today, nearly every major financial institution has launched a sustainability-focused initiative.
What’s unique about Asia is that investors are largely keeping their capital within the region. Around 60% of impact capital originating in Asia stays in Asia, which is higher than in other parts of the world where more capital flows elsewhere. This is partly because the region faces unique challenges, climate change, biodiversity loss and social inequality, which are driving the development of local business models that integrate financial sustainability with measurable impact.
Looking ahead, there are some key trends shaping the market. Blended finance models are becoming more prominent, with governments and institutions like development banks using public-private partnerships to de-risk investments in sustainability. There’s also a rising focus on nature-based solutions and biodiversity investing, with projects centred around mangrove restoration, carbon markets and conservation finance gaining traction. Asia is also taking the lead in climate transition finance, particularly in energy, infrastructure and agriculture, given that it’s one of the region’s most vulnerable to climate change.
Despite this momentum, only 7% of global impact investment capital is currently in East and Southeast Asia, which suggests there’s still massive untapped potential.
TA: What are the biggest challenges clients face in balancing financial performance with measurable impact?
BT: One of the biggest barriers is perception. Many investors still see impact investing as philanthropy rather than a viable commercial strategy. That mindset needs to shift. Clients also struggle with a lack of standardized measurement, which makes it difficult to compare impact investments and increases the risk of being accused of greenwashing.
Short-term financial pressures are another challenge, many investors prioritize quick returns over long-term sustainability, which can be at odds with the timeframes needed for meaningful impact. On top of that, regulatory fragmentation across Asia creates uncertainty, as governments are moving at different speeds on sustainability regulations.
The key to overcoming these challenges is trust and institutionalization. Right now, much of the market still operates on a direct investment model, where wealthy families back individual projects. To scale, we need more structured, fund-based models, similar to what TPG, Goldman Sachs and EQT have done in the West with their impact funds.
TA: What innovative financial instruments are most promising for scaling impact investing in Asia?
BT: There are a few that stand out. Blended finance is a game-changer because it combines public, private and philanthropic capital to reduce risk and attract institutional investors to high-impact projects. Green bonds and sustainability-linked loans are already widely used in Asia and have become a key way for companies to raise capital for sustainability initiatives. Carbon and biodiversity credits are also gaining traction, with investors increasingly looking at Asia’s growing carbon markets.
Another interesting model is the production-protection approach, where profits from sustainable commercial activities, like tree plantations or regenerative agriculture, help fund conservation efforts. Governments, particularly in Singapore and Japan, are playing a crucial role in creating clear regulatory frameworks and financial incentives that are driving more investment into these areas.
TA: How do you advise clients on building robust impact measurement and management systems?
BT: The goal is to go beyond just ESG compliance and build systems that provide real accountability while integrating impact with financial performance. The first step is establishing a strong foundation using global frameworks for core responsible investing practices, like the Taskforce on Nature-Related Financial Disclosures, and then raising the roof by aligning to best impact investing practices, most notably the Operating Principles for Impact Management, which was incubated by the IFC and is now stewarded by the Global Impact Investing Network. Third-party verification and ratings, for example from BlueMark, are also critical for building trust with investors and reducing greenwashing risks.
One of the best ways to align sustainability and financial goals is through incentive structures tied to impact performance. Sustainability-linked loans are one example, but leading investors are becoming more ambitious, linking individual management compensation or fund-carried interest to impact results. This ensures that companies and investment managers have a financial incentive to meet their impact targets rather than just treating sustainability as a box-ticking exercise. Regulators, like the Monetary Authority of Singapore ( MAS ), are also pushing for stronger impact reporting standards, which will help institutionalize impact investing across the region.
TA: What role does private capital play in bridging the financing gap for nature-based solutions, and how can financial institutions contribute more?
BT: Private capital is critical because governments alone cannot fund the transition. Asia has an estimated US$1.1 trillion financing gap for nature-based solutions, and private investors need to step up. Financial institutions have a major role to play in driving investment into this space. They can develop market-based solutions that tie capital to measurable impact, such as investment products linked to carbon sequestration, sustainable agriculture and biodiversity conservation.
Expanding carbon and ecosystem markets is another area of opportunity. Carbon pricing and payments for ecosystem services can transform nature conservation into a revenue-generating sector. Financial institutions can also de-risk projects through blended finance, where governments or multilateral agencies take on early-stage risk to make investments more attractive for institutional investors. Singapore’s GenZero, Temasek’s S$5 billion ( US$3.75 billion ) investment vehicle for climate solutions, and the MAS’ FAST Initiative, which has allocated S$500 million for transition finance, are great examples of how this is already happening.
TA: Is the generational wealth transfer in Asia going to lead to more social impact?
BT: Yes, and in a big way. The next generation of family office leaders in Asia is far more focused on sustainability than their predecessors. While previous generations often donated discreetly, this new wave of investors is professionalizing impact investing. Instead of making one-off donations, they’re bringing structured investment frameworks into the space and demanding clear financial and impact metrics.
Younger investors want increased transparency and measurement, so they’re prioritizing impact investments that provide clear, measurable results alongside financial returns. There’s also been a shift away from traditional philanthropy towards market-based solutions. Impact investments are now being structured more like traditional financial products, which makes them more appealing to a wider range of investors.
Many family offices are also diversifying into sustainability sectors, moving capital from traditional industries into renewable energy, climate tech and biodiversity finance. This isn’t just an ideological shift. It’s a financial one too, as many impact sectors are now delivering competitive returns.
