Avon Pension Fund, the Local Government Pension Scheme for the West of England, has taken a significant step towards achieving its net zero goals by investing over £700 million of equity investments into an innovative, Paris-aligned funding solution.
In total, Avon now holds over £1 billion in dedicated Paris-aligned index equity strategies and has moved away from using standard market-cap indices. These indices are designed to replicate investments in companies who’ve pledged to back efforts to limit global temperature rises to 1.5C, as part of the Paris Agreement on limiting global warming, alongside Avon’s existing £575 million sustainable equity investment strategies and £400 million allocations to investments in renewable infrastructure projects such as solar farms.
Working with asset manager BlackRock, Avon is one of the first Local Government Pension Schemes (LGPS) to embrace Environmental, Social and Governance (ESG) approaches through this investment mechanism.
Nathan Rollinson, Investment Manager at Avon Pension Fund said: “This new investment will help us as we work towards our net zero goals. We’re on track to lower the carbon emissions of our equity portfolio by 2/3rd by 2030, compared with 2019.”
Alex Orr, Head of LGPS at BlackRock, added: “We’re pleased to have worked with Avon Pension Fund in developing innovative investment solutions to progress on their net zero agenda. Their commitment to developing unique structures and improve their net zero positioning is testament to their thought leadership and commitment to partnership.”
The new investment product is structured as a total return swap referencing Paris-aligned indices with the aim of releasing liquidity to support other areas of the investments portfolio while expressly supporting the low carbon transition. Last year Avon Pension Fund invested in an innovative environmentally-aware cash fund and adopted use of Paris-aligned Exchange Traded Funds for efficient cash management.
Avon Pension Fund, the Local Government Pension Scheme for the West of England, has taken a major step forward in achieving its net zero goals with the investment of over £700 million of equity investments into an innovative, Paris-aligned funding solution. The move sees Avon now hold over £1 billion in dedicated Paris-aligned index equity strategies in an effort to replicate investments in companies who’ve pledged to back efforts to limit global temperature rises to 1.5C, as part of the Paris Agreement on limiting global warming.
Working with asset manager BlackRock, Avon has become one of the first Local Government Pension Schemes (LGPS) to embrace Environmental, Social and Governance (ESG) approaches through this investment mechanism. The new investment product is structured as a total return swap referencing Paris-aligned indices with the goal of releasing liquidity to support other areas of the investments portfolio while expressly supporting the low carbon transition.
Nathan Rollinson, Investment Manager at Avon Pension Fund said: “This new investment will help us as we work towards our net zero goals. We’re on track to lower the carbon emissions of our equity portfolio by 2/3rd by 2030, compared with 2019.”
Alex Orr, Head of LGPS at BlackRock, commented: “We’re pleased to have worked with Avon Pension Fund in developing innovative investment solutions to progress on their net zero agenda. Their commitment to developing unique structures and improve their net zero positioning is testament to their thought leadership and commitment to partnership.”
Avon Pension Fund, the Local Government Pension Scheme for the West of England, has taken a major step towards achieving its net zero goals by investing over £700 million of equity investments into an innovative, Paris-aligned funding solution. This move sees Avon now hold over £1 billion in dedicated Paris-aligned index equity strategies, alongside their existing £575 million sustainable equity investment strategies and £400 million allocations to investments in renewable infrastructure projects such as solar farms.
Working with asset manager BlackRock, Avon has become one of the first Local Government Pension Schemes (LGPS) to embrace Environmental, Social and Governance (ESG) approaches through this investment mechanism. The new investment product is structured as a total return swap referencing Paris-aligned indices which is designed to release liquidity to support other areas of the investments portfolio while expressly supporting the low carbon transition.
Nathan Rollinson, Investment Manager at Avon Pension Fund, said: “This new investment will help us as we work towards our net zero goals. We’re on track to lower the carbon emissions of our equity portfolio by 2/3rd by 2030, compared with 2019.”
Alex Orr, Head of LGPS at BlackRock, added: “We’re pleased to have worked with Avon Pension Fund in developing innovative investment solutions to progress
Derick is an experienced reporter having held multiple senior roles for large publishers across Europe. Specialist subjects include small business and financial emerging markets.