Prince Charles is backing a new “natural capital” asset class to fast track protection for nature based industries such as fishing, agriculture and forestry. In Australia, Martijn Wilder, former chair of the Australian Renewable Energy Agency, is adding his weight to the move.
Prince Charles wants to see the emerging “natural capital” asset class grow and grow fast, with the British royal family’s well known environmentalist teaming up with three key players in nature-based investment solutions to accelerate its growth.
Natural capital covers all areas of economic activity derived from natural landscapes – such as fishing, agriculture and forestry – and leverages investment to improve the sustainability of these practices to stop depleting and damaging these resources. Examples include regenerative farming and sustainable fishing.
The founding members of Prince Charles’s Natural Capital Investment Alliance are Lombard Odier, Mirova (an affiliate of Natixis Investment Managers) and HSBC Pollination Climate Asset Management, a joint venture between HSBC Global Asset Management and Martijn Wilder’s specialist climate change advisory and investment firm Pollination.
All three members of the alliance – an offshoot of Prince Charles’s Sustainable Markets Initiative he launched last year – are pioneers in the space. HSBC Pollination Climate Asset Management established a series of natural capital funds just six months ago.
Swiss banking group Lombard Odier recently launched the first global equities investment strategy for natural capital, and Mirova has a new platform for investing in nature-based solutions.
Speaking to The Fifth Estate, Martijn Wilder, founding partner of Pollination Group and a former chair of the Australian Renewable Energy Agency, said that the formation of the alliance follows much discussion about investing in nature and getting nature-based investments moving, including by governments.
The plan is to take the emerging asset class mainstream by mobilising US $10 billion towards nature-based solutions by 2022, and serving as the touchpoint for global corporations and financial institutions looking to invest in natural capital.
Wilder said that there’s been a growing recognition that “if you don’t protect nature you won’t have an economy”.
“The world is starting to realise that – especially if you add the stresses placed on food systems and so forth by climate change.”
Wilder expects it will be a confronting transition for many of these industries, such as agriculture and commercial fishing.
“There’s definitely an education piece.”
Ultimately, natural capital investments seek to maintain the ongoing viability of these practices over the long term, making them more productive and resilient by improving soil quality on farms and creating new revenue streams by tapping into programs that incentivise farmers to increase the carbon content of their soil.
Austral Fisheries are a good example, Wilder said, with the commercial fishing company working hard to improve the sustainability of its practices as well as ensuring its boats are highly efficient.
Prince Charles launched the alliance at the One Planet Summit in Paris on Monday.
“For so many of the problems we face, nature, with the benefit of billions of years of evolution, has already provided us with the solutions,” he said.
“But time is fast running out and we are rapidly wiping out, through mass extinctions, many of nature’s unique treasure trove of species from which we can develop innovative and sustainable products for the future.
“As we urgently seek to rescue the situation, we must now look to invest in natural capital as the engine of our economy.”
Pollination is also working on a climate change investment fund to transition the energy transport sectors.