Asset manager Schroders (SDR.L) has teamed up with an environmental organisation to set up a Singapore-based fund house to invest in projects that seek to halt and reverse the destruction of nature due to climate change.
Akaria Natural Capital, the venture between Schroders and U.S. non-profit organisation Conservation International, will initially invest in 15-20 projects across Southeast Asia, Schroders said on Monday.
Akaria will ultimately manage a series of funds that will finance projects in the region, and will seek a fund management licence from the Monetary Authority of Singapore, it said.
“Large scale investment is needed fast to halt and reverse nature loss. Nature-based solutions should be part of the solution to tackle climate change – and they can bring good returns,” said Schroders Chief Executive Peter Harrison.
“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.”
Conservation International said reversing nature loss, for example by protecting rainforests and preserving mangroves and other biodiverse areas, could account for 30% of the global action needed to stabilise the climate.
As well as helping capture and store carbon emissions, a major human-induced driver of climate change, natural capital solutions can help in other ways, such as by filtering fresh water or providing breathable air, it said.
“Nature-based solutions hold exceptional promise, but it will take sustained investment to unleash that potential at scale,” said Conservation International’s Chief Executive M Sanjayan.
“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.”
Akaria will be led by Chief Executive Gary Addison and Simon Chadwick as chief impact investment officer, Schroders said.