West Yorkshire Pension Fund (WYPF) has made an investment in nature asset manager Rebalance Earth.
The scheme contributed in excess of £5m (€5.9m) to the firm, as WYPF becomes a significant minority owner of Rebalance Earth, having taken a 25% stake in the firm.
According to Rebalance Earth, this is one of the most significant seed investments in the UK this year.
The firm focuses on nature as an investable asset class, by financing nature as business-critical infrastructure and providing climate adaptation and resilience for companies, communities and cities across the UK.
It aims to tackle five critical environmental challenges in the UK – flooding, drought, water quality, biodiversity and carbon - by demonstrating the significant opportunities for companies to make a return when they pay to restore Nature in their local area, while highlighting the investment opportunities for long-term asset owners like pension funds.
Leandros Kalisperas, WYPF’s chief investment officer, said that investing in Rebalance Earth was crucial for fostering innovative solutions and backing UK growth.
“As a large asset owner with a long-term horizon, we have a responsibility to provide direct patient capital to nature as infrastructure and to start to address critical issues like climate change adaptation and resilience here in the UK,” he said.
Darran Ward, investment manager for alternatives at WYPF, noted that the fund’s decision to invest in natural infrastructure aligns with the three key investment beliefs agreed with its investment committee: investment in climate solutions; sustainable cities and communities; and economic growth and innovation driving decent work.
He added: “These UN SDG-based goals focus on sustainable, resilient and scalable business strategies, which we believe are critical to long-term value creation.”Robert Gardner, chief executive officer and co-founder of Rebalance Earth, said that WYPF was setting the standard on the level of commitment needed to put the brakes on the UK climate and nature crisis.
He said: “With their investment, we can build an expert team, launch our fund, and restore landscapes and seascapes across the UK. Nature is our ally against climate change, and we need to start rebuilding this natural infrastructure to protect our companies, communities and cities.”
Over the next decade, Rebalance Earth aims to mobilise over £10bn towards restoring Nature across the UK.
Gardner added: “A ‘2% for Nature’ allocation from the £5trn in UK pension and wealth assets would generate the necessary funds to address the estimated £50-£100bn needed for nature restoration in the UK.”
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