The African Development Bank Group (AfDB) has officially concluded the pilot phase of its ground-breaking Adaptation Benefits Mechanism (ABM) and begun the transition phase that will culminate in the creation of a fully operational permanent ABM Secretariat by 2027. This is a major milestone in global climate governance, as ABM is the first adaptation-focused non-market approach formally recognized by the UNFCCC’s Paris Agreement.
The announcement was made at the COP30 high-level event titled “The Age of ABM Has Arrived: Transformative Climate Finance Practices” held on 13 November at the Multilateral Development Bank Pavilion. The event highlighted the growing global momentum behind innovative adaptation financing and AfDB’s leadership in promoting climate change resilience across Africa.
A new era of adaptive finance
Since its creation in 2019, ABM has been hosted and developed by the African Development Bank with the aim of creating a validated, transparent and reliable model for financing climate adaptation. In the next stage of its evolution, ABM will begin issuing Certified Adaptation Benefits (CABs), a new class of climate assets aimed at quantifying and certifying the outcomes of adaptation projects.
CABs act as results-based adaptation credits, allowing governments, businesses, development partners, and even the private sector to finance adaptation activities with the confidence that their investments directly contribute to reducing vulnerability and protecting communities from climate impacts. Because ABM is recognized as a non-market instrument, every dollar invested in CAB goes directly into implementing or scaling up adaptation measures, avoiding financial abstractions and ensuring tangible results on the ground.
Transition to permanent secretariat
As part of the COP30 announcement, the AfDB issued a global call for expressions of interest from governments and international organizations interested in hosting the next ABM Secretariat. Permanent host institutions play a key role in guiding the mechanism, overseeing CAB certification, setting standards, and coordinating with adaptation project developers around the world.
Once fully operational, ABM is expected to not only support global climate change goals, but also open new avenues of financing for adaptation projects in Africa. The AfDB has indicated that it may provide financing to project developers looking to use ABM as a tool to scale up effective resilience efforts.
Leaders highlight the impact of change
Dr. Kevin Kariuki, AfDB’s Vice President for Power, Energy, Climate Change and Green Growth, hailed ABM as a structural breakthrough in global adaptation finance. He emphasized that this mechanism creates a direct channel for governments to require major emitters to contribute towards adaptation costs.
“ABM represents a mechanism that governments can use to require emitters to contribute to adaptation costs,” Dr. Kariuki said. “Its non-market status means every dollar spent on CAB purchases goes directly to overcoming financial barriers faced by adaptation projects. This is a significant improvement in the utilization of scarce climate finance.”
Gareth Phillips, World Bank Group Manager for Climate and Environmental Finance and one of ABM’s chief architects, highlighted the mechanism’s ability to redefine how adaptation is supported globally.
“Adaptation benefit mechanisms show that adaptation can be efficiently and transparently financed outside of traditional markets. By certifying the results of adaptation projects, ABM provides a trusted way for governments, businesses and citizens to demonstrate solidarity with vulnerable communities, while creating a new class of adaptation assets that can attract sustainable investment.”
Global engagement and high-level dialogue
The COP30 event brought together senior policymakers, climate finance experts, and institutional partners. Moderated by Luc Gunakaja, Co-Chair of the ABM Executive Committee, the session featured a keynote address by Tarje Gbadegesin, CEO of the Climate Investment Fund, and an insightful panel discussion with representatives from:
Kenya,
Sahara-Sahel Observatory,
England, and
African Development Bank Group.
Speakers highlighted the urgent need to diversify adaptation finance, noting that traditional official development assistance (ODA) budgets are increasingly constrained, leaving vulnerable countries with fewer resources to deal with intensifying climate risks.
A promising alternative amidst financing difficulties
As climate impacts accelerate, including more severe droughts, floods, heat waves, and ecosystem stress, the funding gap for adaptation will grow. Stakeholders agreed that ABM offers a reliable and scalable alternative that brings together transparency, efficiency, and solidarity.
By mobilizing new private sector participation and providing a framework for measurable and provable benefits, ABM has the potential to redefine global adaptation finance in the same way that carbon markets once transformed mitigation finance. A focus on proven outcomes gives confidence to funders and delivers real benefits to frontline communities.
Looking to the future
A transition phase is underway and the next few years will be pivotal. Establishing a permanent ABM Secretariat by 2027 will lay the institutional foundations for global adoption and enable governments and financial institutions to integrate qualified adaptation benefits into their climate strategies.
The African Development Bank’s leadership has placed Africa, which has historically not been responsible for the climate crisis but is most vulnerable to its impacts, at the forefront of shaping fair and innovative climate finance tools.
