Just Climate, an investment business established by Generation Investment Management to address the net-zero challenge at scale, has closed its inaugural fund at £1.2 billion.
The London-based fund will provide capital to invest in the highest impact solutions that can radically reduce or remove emissions, while generating attractive risk-adjusted financial returns.
The fund closed with a diverse set of institutional investors with a far-reaching geographical spread, including California State Teachers’ Retirement System (CalSTRS), PSP Investments, AP4, Colonial First State Investments, Builders Asset Management and AP2; as well as other pensions, sovereign wealth funds, insurers, financial institutions, endowments, foundations and family offices from North America, Europe and the Asia Pacific region.
The fund’s founding investor group included Microsoft’s Climate Innovation Fund which anchored the Fund, IMAS Foundation, Ireland Strategic Investment Fund, Harvard Management Company, the Imprint Group of Goldman Sachs as well as Hall Capital Partners and its clients.
“Establishing climate-led investing as a capital allocation imperative is core to our mission,” said Clara Barby CBE, senior partner of Just Climate.
“We start with climate impact, identify solutions that will make the biggest difference, and then direct and scale institutional capital to those solutions that we believe can generate attractive risk-adjusted returns.
“We’re grateful that many of the world’s most significant institutional investors see the opportunity that climate-led investing represents — for capital markets, for the planet and for people everywhere.”
The fund will pursue investments in growth-stage, asset-heavy companies globally which have the potential to deliver transformational climate impact across some of the highest-emitting, hard-to-abate industries – including energy, mobility, industry and buildings – in order to generate outsized emissions abatement in the next decade.
Shaun Kingsbury CBE, chief investment officer of Just Climate, said: “More than 50% of the world’s emissions come from the hard-to-abate industries. Without radical and urgent changes to the way that the financial sector approaches the decarbonisation challenge in these industries, which are the building blocks of our economy, there will be no net zero by 2050.
“Proven, transformational climate solutions are being developed to decarbonise the industrial sectors. With the right investment support, we believe they can scale rapidly to achieve better gross margins, a lower cost of capital and widespread market adoption.”