Schroders Finds Partner for Investing in Nature

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    Stockholm (NordSIP) – According to Conservation International, we could count on nature to provide 30% of the action needed to avoid the worst effects of climate change. Beyond carbon capture and storage, nature also offers a range of additional benefits, such as filtering freshwater or providing breathable air. Yet, natural climate solutions currently receive less than 3% of all global climate finance.

    To capture some of this potential and accelerate investment in nature, Schroders announced on 25 July that they would be teaming up with Conservation International to establish Akaria Natural Capital, a dedicated natural capital impact investment manager. Schroders will undoubtedly benefit from Conservation International’s more than three decades of technical and scientific expertise working with communities to raise and deploy conservation capital at scale.

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    Based in Singapore, Akaria Natural Capital will invest in a number of relevant, high-quality projects across Southeast Asia over the first five years. The goal of these projects will be to deliver both long-term returns and environmental benefits while impacting positively to local communities. The partnership also aims to contribute to a better understanding of how to allocate capital towards nature and support the development of a natural capital investment market. The efforts will be led by a duo of professionals with an extensive background in private equity investment: Gary Addison, Chief Executive Officer, and Simon Chadwick, Chief Impact Investment Officer. Both have actively participated in Akaria Natural Capital’s creation as co-founders.

    “Large scale investment is needed fast to halt and reverse nature loss,” comments Peter Harrison, Group Chief Executive of Schroders. “Nature-based solutions should be part of the solution to tackle climate change – and they can bring good returns. But the devil is in the detail. They must be high quality, and they must put local communities and the people who live there at the heart of any action. That’s why we’re working with Conservation International to do this right. Our ambition is high: we want to harness the power of investment to accelerate a nature-positive future by creating opportunities for impact beyond returns.”

    It would appear that Schroders has made natural capital and biodiversity a priority. Last year, the manager announced a strategic partnership with Natural Capital Research (NCR), along with Oxford Sciences Innovation (OSI). Schroders has been quick to join the Natural Capital Investment Alliance (NCIA) and is one of more than 30 leading financial institutions to commit to tackling agricultural, commodity-driven deforestation. The firm has also prioritised natural capital and biodiversity for active engagement with companies as part of its award-winning Engagement Blueprint.

    This latest collaboration is another step in the same direction. Announcing the establishment of Akaria Natural Capital, Schroders also noted that they would seek to align the engagement expectations with those of other major collaborative initiatives such as the Taskforce on Nature-related Financial Disclosures, Science-Based Targets for Nature and NA100+, where appropriate.

    “Nature-based solutions hold exceptional promise, but it will take sustained investment to unleash that potential at scale,” comments Dr M Sanjayan, Chief Executive of Conservation International. “This initiative sends a powerful message to the financial services industry. Generating healthy returns, protecting nature, and supporting community development need not be mutually exclusive goals. We’re grateful to Schroders for their commitment to building a replicable model for others to adopt.”

    Image courtesy of Chris Hilbert from Pixabay
    Julia Axelsson, CAIA
    Julia Axelsson, CAIA
    Julia has accumulated experience in asset management for more than 20 years in Stockholm and Beijing, in portfolio management, asset allocation, fund selection and risk management. In December 2020, she completed a program in Sustainability Studies at the University of Linköping. Julia speaks Mandarin, Bulgarian, Hindi, Russian, Swedish, Urdu and English. She holds a Master in Indology from Sofia University and has completed studies in Economics at both Stockholm University and Stockholm School of Economics.
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