Deal is part of wider investment strategy to divest from fossil fuels and back green projects, says investment committee member.
The National Trust, Europe’s largest conservation charity, has awarded asset management firm Robeco a £75 million mandate to help achieve its net-zero greenhouse gas (GHG) emissions by 2030 commitment.
With €176 billion in assets under management (as of December 2020), Robeco was selected as a partner in the transition due to its active stewardship and innovative climate solutions offering, said Alice Bordini Staden, member of the National Trust Investment Committee.
“The financial sector has a pivotal role to play in enabling the transition to a low carbon economy,” she told ESG Investor. “[The National Trust] will be continuing to invest in climate solutions at the same time as progressively decarbonising our operations and financial investments.”
The mandate provides seed capital to Robeco’s Climate Global Credits fund, which invests in corporate bonds aligned to the goals of the Paris Agreement. The Climate Global Credit strategy is the first global fixed income strategy to be fully compliant with the EU benchmark for Paris-aligned investments. The strategy aims to decarbonise by 7% per year while outperforming the Solactive Paris Aligned Global Corporate Index.
“Robeco’s Climate Global Credits strategy provides investors with the opportunity to be at the forefront of the transition to a low-carbon economy, and for the National Trust, this investment will help it achieve its own goals to tackle the causes of climate change,” said Katie Weber, Head of UK Institutional at Robeco.
This follows a 2019 announcement by Hilary McGrady, Director-General of the National Trust, committing the charity to completely divest from all fossil fuel companies within three years.
Before this, the National Trust’s investment policy already required that no investment be made directly into companies deriving more than 10% of their turnover from the extraction of thermal coal or oil, McGrady wrote.
More recently, the charity has committed to increasing engagement with companies it currently invests in, asking for more material improvements in their environmental performance.
With an annual income of £680 million, the National Trust plans to create 25,000 hectares of new wildlife habitats by 2025 as well as a further 18,000 hectares of new woodland made up of more than 20 million trees within the next decade. It has pledged that 50% of its energy needs will be met by renewable sources by the end of 2021.
The National Trust is a signatory of the Paris-Aligned Investment Initiative, the Institutional Investors Group on Climate Change (IIGCC) Net Zero Asset Owner commitment and the Net Zero Investment Framework.