Asset management company Aviva Investors has launched a carbon removal fund, targeting both natural and technology-powered climate solutions.
The fund’s seed financing was provided by Aviva Investors itself, with an undisclosed amount coming in through its well-established investment, wealth, and retirement business.
As stated by Aviva Investors, the idea behind the fund is to enable large-scale investors like corporates, pension funds, insurers and local government pension schemesto invest in projects centered around commercial forestry, afforestation and reforestation initiatives that operate on peatlands and mangroves, venture and private equity-powered nature tech, and other CO2 removal projects, like enhanced rock weathering (ERW) or soil carbon sequestration.
While low-carbon investments and CO2 removal credits will be the primary focus of the fund, the initiative will also take into consideration other benefits brought forth by these projects, such as biodiversity stimulation, protection of species, water quality improvement, and similar environmental upgrades.
The new fund will have a global reach, accessing projects in different environments ranging across temperate and tropical climates. According to Aviva Investors, this broad strategy is a vital element that will help address the climate investment gap evident between developed and emerging markets on the global scene.
Another key factor that will help the fund keep clearer project reporting is the direct work model it will have with NGOs, conservation groups, land managers, and development partners.
Greta Talbot-Jones, Aviva Investors natural capital director and co-portfolio manager of the carbon removal fund, commented, “That is a vitally important element of this strategy, as it should provide clearer, more direct, and less diluted reporting lines from the projects we fund on how investment capital is being deployed, which activities that funding is supporting and where, and the impact it is having in terms of real-world outcomes.”
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Chief investment officer at Aviva Investors Daniel McHugh shared that this fund will serve the needs of investors with elaborate decarbonization pathways who are looking for safety against exposure to carbon pricing.
He went on to add that this fund comes in response to appeals made by investors for better investment strategies that align with net-zero objectives and deliver long-term performance.
“We think our carbon removal fund is truly at the forefront of how asset managers can best capture these opportunities,” McHugh said.
Read more: Morgan Stanley IM Sets Up $750 Million Fund To Invest In Carbon Removal And Reduction
