Credit Suisse raises $212m for 'world's first' ocean health impact fund
Swiss investment bank Credit Suisse has partnered with Rockefeller Asset Management to launch an impact fund that will finance projects improving ocean health, raising $212m pre-launch.
The businesses claim that the ‘Ocean Engagement Fund’ is the first impact fund of its kind, in that it is solely dedicated to and fully aligned with Sustainable Development Goal (SDG) 14: Life Below Water. The Goal includes targets to address issues such as overfishing, marine pollution and acidification, and to boost conservation and restoration.
Between 30 and 50 businesses will be backed by the fund. Non-profit The Ocean Foundation will advise Credit Suisse and Rockefeller Asset Management on which companies to include in the portfolio. It will also provide best-practice learnings on engaging with portfolio businesses to steer them away from practices which harm the oceans, going beyond ‘doing less bad’ and achieving a net-positive impact on marine habitats.
A list of potential holdings has not yet been confirmed. However, the Ocean Engagement Fund is expected to assist both companies seeking to transition to ocean-positive operations and firms which provide innovative solutions to the issues facing oceans today.
Credit Suisse, emphasised, through a statement, the importance of ocean conservation to the shared effort to combat climate change and create a Paris-Agreement-aligned world. IPCC research has confirmed that the oceans have absorbed more than 90% of the extra heat generated by man-made activity and about a quarter of man-made CO2 emissions since 1970. As such, they play a crucial role in regulating the climate.
“The ocean is amongst some of the least invested topics from the UN Sustainability Goals yet more than a third of institutional investors have expressed their interest in investing in the Blue Economy,” Credit Suisse’s CSO and global head of sustainability strategy advisory and finance, Marisa Drew, said. “We are happy to be leading the way to help investors to have an impact”.
The launch of the Ocean Engagement Fund comes after Credit Suisse issued a $28.6m (£22.2m) bond aimed at financing the protection and restoration of fresh and saltwater resources and habitats in 2019, in partnership with The World Bank. The fund also forms part of the bank’s new commitment to provide more than £250bn in financing geared towards green bonds and the low-carbon economy over the next decade. It is notably also managing a separate impact fund relating to SDG 12: Responsible Production and Consumption.
Elsewhere in the emerging field of ‘blue finance’ – a term used to describe green finance focussed specifically on water - international environmental non-profit The Nature Conservancy (TNC) is in the process of launching a series of bonds for ocean conservation, totalling $40m (£30m). The aim of the bonds is to unlock $1.6bn for the restoration and conservation of 1.5 million square miles of marine environments.
But greater levels of nature-related finance – and better processes for allocation – are clearly needed if governments and businesses are to play their role in averting Earth’s sixth mass extinction. In a letter sent to UN Secretary-General Antonio Guterres this week, to coincide with the UN Biodiversity Summit, a coalition of 140 nature conservation organisations are warning that $500bn of funding annually is needed to protect, restore and create habitats.
The letter calls for more financing to be provided to local conservation organisations rather than corporates, as they “see first-hand the challenges facing the natural world and have the knowledge necessary to secure real change”.
At the UN Summit, world leaders are working to finalise the UN’s ‘Paris-Agreement-style’ deal for nature. In its current form, the deal contains a headline commitment to protect at least 30% of terrestrial, marine and freshwater habitats.
It is hoped that the deal, compounded by the forthcoming recommendations of the newly-created Taskforce for Nature-related Financial Disclosures, will empower businesses to better collaborate with governments to accelerate nature-related finance. WWF recently released a film detailing the ways in which the financial sector has contributed to nature loss historically and the actions it must now take to transform and become a force for good.