London CIV plans to launch natural capital fund

The local authority pension scheme asset manager has launched several ESG and responsible investment public and private market vehicles in the last three years.

London CIV has appointed consultant Redington to support its launch of a natural capital investment vehicle.

The investment manager, which is responsible for 32 London local authority government pension scheme assets, has launched several public and private market funds in the last three years aimed at addressing responsible investment, ESG and net-zero targets.

These include The London Fund, its Infrastructure Fund, Renewable Infrastructure Fund, and UK Housing Fund, all of which are private market vehicles.

Public market funds launched to address ESG and net-zero targets include the Global Alpha Growth Paris-Aligned Fund and the Passive Equity Progressive Paris Aligned Fund.

“A natural capital fund is London CIV’s latest endeavor in helping our partner funds reach their ambitious investment and net-zero goals, and it’s great to have Redington join London CIV again to assist in building out this latest product,” said London CIV CEO Dean Bowden.

“It’s anticipated that large-scale carbon capture will play a fundamental role in the path to net zero. Indeed, we could achieve a 30-40 percent reduction in CO2 emissions by restoring natural habitats across the globe, according to one academic study.”

London CIV said 30 of its corporation partner funds have declared a climate emergency since the Paris Agreement was adopted in 2015, and “many have expressed a desire for a suitable, ambitious investment vehicle that will provide more exposure to natural capital within their portfolios and help accelerate the path to net zero.”

Jill Davys, head of local government pension schemes at Redington, added: “Natural capital presents a unique opportunity for long-term investors to align their portfolio with their net-zero objectives and drive strong financial returns in the process.

“Having assisted London CIV on manager selection for its renewable infrastructure fund, we are delighted to be supporting them on this important initiative and look forward to helping them build a solution to meet their partner funds’ needs and objectives.”

London CIV was established in 2015 and has £14.3 billion ($17 billion; €16 billion) in assets under management.