The latest developments in the ESG investment space.
Furthering natural capital as its own asset class, HSBC Global Asset Management has teamed up with ESG investment firm Pollination to create a series of funds dedicated to natural capital themes aimed squarely at institutional investors. The joint venture will be called HSBC Pollination Climate Asset Management – subject to approval – and led by Christof Kutscher as executive chairman.
As ESG investment has started to dominate, led by ambitious climate and decarbonization goals, the new venture has cast itself as the “first large-scale effort to mainstream natural capital as an asset class.”
The first fund, due to be launched by mid-2021 raising up to $1 billion, will be seeded by HSBC, with a second carbon-credit fund slated to follow. The parties said that both funds will be invested in a diverse range of schemes that can "preserve and enhance nature over the long-term", including sustainable forestry and agriculture, water projects, carbon capture by oceans, and a host of other nature-based initiatives.
“Investing in the resilience of nature is investing in the resilience of the economy. Nature is the most fertile investment we have,” Pollination co-founder and partner Martijn Wilder said. “To reach the goals set in the Paris Agreement we need to originate and fund new approaches that protect nature at scale,” he added.
Sustainable investing has been the main growth story over the last few years. By some estimates the global market is currently worth $31 trillion.