Northern European Lead Against Climate Change – The Rise of Climate Tech


The Managing Partner of NordicNinja, Tomosaku Sohara has an extensive background in financial services, with a dedicated passion for solutions combatting climate change. Here are Tomosaku’s observations on Northern European tech activity in the realm of climate fintech.

Nordics Setting the Standard for Sustainability

Nordic countries have led the way in sustainability, topping the rankings in the CGT and Green Future Indexes. It’s no surprise that many exciting solutions to address climate change are coming out of Northern Europe.

Climate change was put on the political agenda in the early 1990s, and Europe has been pursuing global leadership in this area. After the Paris Agreement in 2015, the EU approved the circular economy action, making it the first region to adopt such a strategy. The EU Green Deal, launched by the European Commission in 2019, is designed to transform the EU into a carbon-neutral society with a competitive economy, recognizing the crisis as an opportunity for economic growth.



Carbon Markets: Europe Leads the Way

Europe is ahead of the curve in carbon tax systems, demonstrating the seriousness of its commitment to climate action at the regulatory level. For example, Finland implemented a carbon tax as far back as 1990, while Japan is still discussing the issue, with the Japanese Ministry of Economy reluctant to impose additional burdens on businesses. 

Globally, there are only 27 countries that have decided to start implementing the carbon taxand 19 out of these 27 countries are located in Europe. The carbon tax implementation rate is relatively high in Nordic countries Finland, Sweden, and Norway.

The financial infrastructure for sustainable actions has also matured, driven by Europe. In 2021, the compliance carbon market was worth 850 billion dollars, compared to just 47 billion in 2017. The EU ETS, or European markets, dominate this market, accounting for 90% of the market share.

There is also a growing “voluntary carbon market,” a peer-to-peer carbon credit exchange allowing individuals and corporations to trade carbon credits. While this market is still in its early stages, it’s growing, and Europe will likely have a significant portion of the market share in the future.

The Booming Sustainable-Tech Industry in Northern Europe

The sustainable tech industry in Northern Europe has experienced a ten-fold growth, reaching 8 billion dollars, with 13.6% of total capital invested. Although Northern Europe trails the United States in total investment in sustainable tech startups, it has the quickest growth in sustainable technologies, seeing a tenfold increase in just the past five years. Capital invested in sustainable tech startups now makes up close to 14% of total investment in Northern Europe, the highest percentage of any region.


Over the past ten years, the world has seen a green tech boom, with many hardware-driven companies. There has been a lot of diversification in the industry since then, with transportation and recycling now playing significant roles, as well as ocean technology and natural resources. Today, however, many companies are coming from the software side, even though they may eventually implement hardware into their solutions.


Climate fintech

A newcomer to the scene is “climate fintech,” a company that sells services or products to facilitate decarbonization. One of these is our portfolio company ClimateView, which accelerates cities’ transition to zero-carbon economies. With a global ambition from the very first day they’ve become the leading service globally used by several hundreds of cities.  

Below in the picture are some other great examples of climate fintech and we are excited to witness again how Northern Europe, with its blend of climate-friendly actions and ClimateFintech, is reshaping its economic landscapes by embedding sustainability at its heart. The Nordic approach offers a promising glimpse into a future where finance harmoniously intersects with sustainability.


Are you building the next climate tech solution in the Northern European region? We would love to hear from you!

Tomosaku Sohara,
Managing Director

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