Essex Pension Fund, Chelmsford, England, made a £100 million ($116 million) anchor commitment to a Stafford Capital Partners fund, in a move that expands its global timberland portfolio and accelerates its net-zero transition.
Stafford Carbon Offset Opportunity Fund is classified as an Article 9 impact strategy under the European Union's Sustainable Finance Disclosure Regulation and will develop new commercial timberland and restore natural forests across the globe, according to a news release on the £9.6 billion pension fund's website.
The fund is targeting £1 billion in assets.
The investment is expected to contribute significantly to the reduction in carbon intensity of the pension fund's investment portfolio.
Essex Pension Fund made its first timberland investment in 2011.
"Over the last few years, significant improvement in our funding position has allowed us to take the opportunity to implement our medium-term derisking program, which has resulted in the fund's strategic allocation to this asset class increasing from 2% to 4%," said Susan Barker, chairwoman of the Essex Pension Fund Strategy Board and Investment Steering Committee, in the news release.
The aim is to have about 10% of the pension fund invested in impactful investment solutions that deliver both positive environmental and social benefits, Ms. Barker added.
Essex Pension Fund in July announced its commitment to be net-zero by 2050, according to a news release provided by a spokesman for the pension fund's administering council.
Stafford Capital Partners has $7.5 billion in assets under management and advisement.
