London CIV kicks off plans to launch Natural Capital Fund

26 October 2023

London CIV publishes on its website:

We’ve brought in Redington to help build a Natural Capital investment offer – adding to our existing suite of 22 pooling funds available to London’s 32 boroughs and City of London Corporation.

Natural Capital refers to the world’s natural assets, including its geology, soil, air, water and all living things. For over 10,000 years, our planet’s natural carbon cycles have been in balance thanks to ecosystems such as forests, soils and oceans taking carbon in and cycling it back out again.

Human-induced emissions and the destruction of ecosystems, especially since the industrial revolution, have curbed nature’s ability to capture and store carbon, resulting in rising global temperatures.

In building out a Natural Capital investment product, our plan is to further align London CIV’s offering with the investment goals of our borough and corporation partner funds (all of which are shareholders of London CIV).

Thirty of these partner funds have already declared a climate emergency since the Paris Agreement was adopted at the UN Climate Change Conference 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.

Redington will advise London CIV’s dedicated Private Markets team as we build out an attractive Natural Capital investment vehicle over the coming months. Redington was appointed following a competitive procurement exercise.

The investment consultant previously advised on the manager selection for the LCIV Renewable Infrastructure Fund in March 2021 prior to London CIV forming its own Private Markets team.

Dean Bowden, CEO of London CIV, commented: “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% reduction in CO2 emissions by restoring natural habitats across the globe, according to one academic study*.

“A Natural Capital fund is London CIV’s latest endeavour 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.”

Jill Davys, Head of LGPS 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.”

The Natural Capital move follows London CIV’s launch of several funds over the last three years that have been specifically designed to help our partner funds meet responsible investment, ESG and Net-Zero targets.

These include London CIV’s Global Alpha Growth Paris-Aligned Fund and Passive Equity Progressive Paris Aligned (“PEPPA”) Fund in public markets, as well as The London Fund, its Infrastructure Fund, Renewable Infrastructure Fund, and UK Housing Fund in London CIV’s private market solutions.

Source: London CIV