Fidelity Joins Fight to Preserve Biodiversity

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    Stockholm (NordSIP) – Preserving the planet’s biodiversity has been steadily climbing up the priority agenda of many investors in recent years. Hopefully, the movement is about to accelerate as we draw closer to the long-awaited and several times postponed 15th Conference of the Parties to the Convention on Biological Diversity (COP15), to be held in Montreal in December.

    A point in case, on 20 September, Fidelity International announced the launch of their new thematic product, Fidelity Funds – Sustainable Biodiversity Fund, aimed at providing investors access to a global equity portfolio of companies contributing to biodiversity preservation. It is a welcome addition to Fidelity’s growing range of sustainable funds, all adhering to a strict and coherent ESG framework to ensure consistent, transparent, and credible sustainability attributes across multiple asset classes.

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    “The world is now waking up to the urgent threat to biodiversity and natural capital,” comments Velislava Dimitrova, the new fund’s Portfolio Manager. “Biodiversity investment solutions are emerging as the largest investment megatrend in our generation and provide opportunities for investors. The theme is at an inflexion point and belatedly transforming from a neglected risk into a top priority.”

    According to the press release, the Sustainable Biodiversity Fund will aim to contribute to the improvement of global biodiversity preservation in two ways. Apart from allocating capital towards biodiversity ‘best-in-class’ companies, the fund will also invest in the value chain of companies involved in providing solutions to reduce biodiversity loss. Given that both the solution providers and the market-leading companies that will make it into the fund span many areas of economic activity, the combination is expected to be a well-diversified portfolio on a global and sector basis.

    “By approaching biodiversity loss from a 360-degree lens, this product can invest across a range of sectors and opportunities, presenting a diversified product structure,” explains Christophe Gloser, Head of Sales, Continental Europe, at Fidelity International. “It can flex its remit across industries, regions, and market capitalisations to find the best ideas from an alpha generation and biodiversity preservation perspective.”

    Given the huge funding gap in this field, there will be plenty of ideas and opportunities for the portfolio manager to choose from, no doubt. The UN Environment Programme conservatively estimates that meeting international biodiversity commitments will require USD 8.1 trillion of cumulative investment in nature-based solutions between now and 2050. However, the number is significantly higher considering the interlinked relationships with climate change. Consider that the annual investment in biodiversity preservation is currently USD 133 billion, while the spending on solving climate change was approximately USD 800 billion in 2021.

    It is obvious that we need to step up investments if we want to maintain our planet’s biodiversity. Every contribution counts.

    Image courtesy of Laura Kuhn from Pixabay
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