Weekly ESG News: Financial Services and Insurance Industry (05/2024)
News in the spotlight: Generate Capital raises $1.5bn from CalSTRS, Hesta, QIC
Generate Capital has closed a successful $1.5 billion capital raise, with participation from global institutional investors, including CalSTRS. The round brings Generate’s total capital raised to over $10 billion since 2014.
Products and Services
Mirova raises $282mn to accelerate climate action in emerging markets
The Mirova Gigaton Fund, managed by Mirova, has secured $282 million, exceeding half of its $500 million target. The fund focuses on clean energy projects in Africa, Asia, the Middle East, and Latin America, with support from the European Investment Bank (EIB), which committed $75 million and an additional EUR 5 million. The fund aims to mobilize institutional investors for impactful climate, social, and gender equality investments. Projects like Solar Panda and Energy Vision seek to enhance energy access. Additionally, the fund aligns with the G7-founded 2X Challenge, supporting female entrepreneurs in emerging markets and promoting gender-focused clean energy solutions.
Generate Capital raises $1.5bn from CalSTRS, Hesta, QIC
Generate Capital has closed a successful $1.5 billion capital raise, with participation from global institutional investors, including CalSTRS. The round brings Generate’s total capital raised to over $10 billion since 2014. Generate has played a significant role in sustainable power and waste processing. The company’s diverse projects and subsidiaries underscore its commitment to the infrastructure transition. CalSTRS’ involvement strengthens the strategic partnership, aligning with their mission of superior financial returns and positive environmental outcomes. Generate Capital is a prominent sustainable infrastructure platform that delivers affordable and reliable resource solutions through democratized, digitized, decarbonized, and decentralized projects. Read more here.
Schroders Greencoat to acquire £700m solar portfolio
Schroders Greencoat is set to acquire Toucan Energy’s solar portfolio, comprising 53 operational solar farms in the UK, valued at approximately £700 million. This transaction, the largest of its kind in the UK, will add 513.5 MWp of capacity, powering around 184,000 homes. As the leading manager of operating solar farms in the UK, Schroders Greencoat aims to leverage its expertise to ensure the long-term financial stability of these assets. The majority of the portfolio will be acquired by Schroders Greencoat-managed funds, with co-investment from Tokyo Century and participation from six Local Government Pension Schemes. The acquisition follows a competitive bidding process managed by Interpath Advisory. RBC Capital Markets served as Schroders Greencoat’s exclusive financial adviser.
Bregal Investments launches natural capital strategy
Bregal Investments has launched Bregal Sphere Nature, a natural capital strategy focusing on high-quality nature-based solutions (NbS). Agustin Silvani, former head of Conservation Finance at Conservation International, joins as Managing Partner, bringing extensive experience and a broad corporate network. The strategy addresses the underinvestment in natural capital, particularly in agricultural supply chains, and supports the development of a high-integrity Voluntary Carbon Market. Bregal Sphere Nature will invest in genuine NbS projects, with a focus on long-term investments in agricultural supply chains, such as agroforestry models for coffee and cocoa.
Regulations, Law & Frameworks
ECB increases focus on green transition, climate- and nature-related risks
The European Central Bank (ECB) is expanding its climate efforts with a focus on three key areas for 2024 and 2025: analyzing the green transition, assessing the physical impact of climate change, and examining risks associated with nature loss. ECB President Christine Lagarde emphasized the need to understand and adapt to these changes, with concrete measures including intensified work on transition funding and exploring changes to monetary policy instruments. The decision follows a stocktake of climate actions since the 2022 climate agenda launch and underscores the ECB’s commitment to supporting the green transition.
Texas bans Barclays from municipal bond market
Texas Attorney General Ken Paxton announced on Friday that Barclays is barred from underwriting municipal bonds in the state for failing to address inquiries about its greenhouse gas emission commitments. This aligns with Republican criticism of ESG investing, seeking to limit other banks’ involvement in the local government debt market. Barclays, identified as a member of a net-zero alliance, faced potential classification as a ‘fossil fuel boycotter’ under Texas law. Despite the state’s inquiry, Barclays chose not to respond, risking the loss of contracting with Texas governmental entities. Texas, known for its conservative stance, maintains a list of financial firms boycotting energy companies and challenges the Biden administration’s rule allowing socially conscious investment in employee retirement plans. Barclays declined to comment.
IESBA launches public consultation for new ethical benchmark
IESBA has introduced two Exposure Drafts proposing global ethical standards for sustainability reporting and assurance. The drafts aim to establish a framework to enhance the quality of sustainability information, mitigate greenwashing, and build trust. Applicable to all sustainability practitioners and professional accountants, the proposed standards align with the growing significance of sustainability information across various sectors. Stakeholders are encouraged to provide feedback by May 10, 2024, for the Sustainability ED and April 30, 2024, for the Using the Work of an External Expert ED. Global webinars will explain key proposals, and additional resources will be released to support understanding of the drafts.
ESG Data & Analytics
Allianz launches new dashboard to track transition pathways
Allianz has launched SAMEpath, a user-friendly dashboard tool that simplifies tracking and analyzing transition pathways for over 50 industries globally, aligning with Net Zero targets from the 2015 Paris Agreement. The tool provides insights into required emission reductions, associated investments, and climate transition risks. SAMEpath is open source, customizable, and supports stakeholders in making informed long-term business decisions and investments to achieve Net Zero goals.
Nasdaq acquires Metrio to accelerate ESG reporting
Metrio, a sustainability-focused company, has recently joined Nasdaq’s ESG solutions, marking a significant milestone in their journey. The collaboration aims to empower global corporations in managing sustainability efforts, bringing together over 100 professionals and various technologies. The acquisition by Nasdaq, known for its commitment to ESG excellence, addresses evolving ESG needs, from supply chain emissions management to reporting framework disclosure. The partnership aligns with the common goal of contributing to a more sustainable future. Patrick Elie, Metrio’s CEO, expressed pride in their market-leading reporting solutions, while Pierre-Alexandre Hurtubise, COO & Co-Founder, is excited about expanded opportunities as part of Nasdaq.
Leadership Announcements
UBS appointed Beatriz Martin Jimenez as GEB Lead for Sustainability and Impact
Aleksandar Ivanovic will join UBS’s Group Executive Board as President Asset Management, succeeding the retiring Suni Harford, effective from March 1, 2024. In addition, Beatriz Martin Jimenez will assume the role of GEB Lead for Sustainability and Impact alongside her current responsibilities. Ivanovic, with extensive experience in client coverage and regional leadership, has been integral to UBS’s Asset Management strategy. Jimenez, who has been with UBS since 2012, will take on the sustainability leadership role while continuing her existing positions.
AXA IM appoints Thomas Coudert as Head of Sustainability, Core Investments
AXA Investment Managers (AXA IM) has appointed Thomas Coudert as the Head of Sustainability, Core Investments. With 17 years of experience at AXA IM, Thomas was previously the Head of Fixed Income Sustainability since 2021. In his new role, based in Paris, he will oversee sustainability across the Core investment platform, maintaining portfolio management responsibilities. Marion le Morhedec, Global Head of Fixed Income, praised Thomas’ expertise and valuable experience. Thomas Coudert holds a Master’s degree in Engineering and is a CFA charterholder, having joined AXA IM’s European Credit team in 2007.
Casey Verbeck joins DAI Capital as Managing Director Impact Investment
DAI Capital has enhanced its impact investing capabilities by appointing Casey Verbeck as Managing Director, Impact Investment. With over 20 years of experience, Verbeck, former Partner and Managing Director at Veris Wealth Partners, will lead strategy, marketing, and fundraising for DAI Capital’s impact investing businesses, including MicroVest. DAI Capital focuses on mobilizing private capital for sustainable development in emerging economies, operating through three pillars: corporate finance, project finance, and asset management. Based in Colorado, Verbeck, an experienced entrepreneur, has successfully launched impact-focused strategies with partners such as National Geographic and The Nature Conservancy, emphasizing economic revitalization, conservation, equity, and community wealth building.