Best impact initiative for ESG: Axa Investment Managers

Channels: Green Bonds

Companies: Axa IM, WWF France

People: Jonathan Dean

When it launched an impact fund dedicated to biodiversity conservation, Axa Investment Managers (Axa IM) said it was necessary to create a "new paradigm" for investing that aligns financial returns with long-term conservation.

Its third impact fund will invest up to €200 million ($223 million) of AXA capital to fund solutions that deliver what it characterises as "intentional and measurable" positive outcomes contributing to the fight against climate change and loss of biodiversity.

The strategy is designed to conserve, protect and restore land-based and marine natural capital to preserve their ability to act as natural carbon sinks and "high-value habitats", as well as reduce or prevent emissions of greenhouse gases, promote resource efficiency, and protect vulnerable communities from climate-related risks.

Jonathan Dean, head of impact investing at Axa IM, said: "Resource reliance on natural capital, both land-based and marine, accounts for significant ecosystems degradation and biodiversity loss.

"Tropical and subtropical forests are home to over half of the world's biodiversity, habitat to threatened species and support the livelihoods of 1.5 billion people in rural communities. We are also seeing competing demand for land putting pressure on greenbelt areas of developed countries.

"Land use change is one of the most important factors in the sixth mass extinction which we are currently experiencing," said Dean.

Axa IM measures the impact of the fund's investments according to the following criteria:

  • Carbon dioxide (CO2) emissions avoided;
  • Natural capital conserved;
  • Habitats protected; and
  • Number of people or communities reached.

Among its investments are a project in Latin America to restore degraded lands and prevent deforestation of large-scale primary forests. It includes helping smallholder farmers develop sustainable agroforestry livelihoods.

The fund forms part of a larger biodiversity conservation strategy by Axa.

In May, it published a report with NGO WWF France, Into the Wild: integrating nature into investment strategies.

At the time, Axa CEO Thomas Buberl highlighted the economic and financial impacts of 'bankrupting' nature and how investors can help reverse nature loss through new forms of public-private collaboration.