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Key Impact Points:
- Morgan Stanley Investment Management (MSIM) concludes its 1GT climate private equity fund at $750 million, focusing on reducing global carbon emissions.
- 1GT aims to prevent or remove one gigaton of CO2 emissions by 2050, aligning financial incentives with climate goals.
- Fund invests in private firms across mobility, power, and sustainable food sectors, leveraging Morgan Stanley’s global resources for growth and ESG enhancement.
Strategic Investment in Climate Mitigation
Morgan Stanley Investment Management has successfully completed funding for its ambitious 1GT climate private equity fund, securing $750 million. This fund is strategically focused on investments that will significantly reduce the global carbon footprint through innovative companies in North America and Europe. Vikram Raju, MSIM’s Head of Climate Private Equity Investing, emphasized the fund’s commitment: “We are pleased to have arrived at the final close of 1GT, a highly focused fund that is providing capital at the critical growth stage to companies whose products and services enable meaningful reduction in the global carbon footprint.”
Incentivizing Climate Goals
The fund not only targets substantial environmental impacts but also uniquely integrates these goals into its financial structure. “Half of the 1GT team’s financial incentives will be tied to achieving the avoidance or removal of one gigaton of CO2e emissions by 2050,” Raju added, highlighting the alignment of financial incentives with environmental performance.
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Leveraging Global Expertise for Local Impact
David N. Miller, Head of Morgan Stanley Private Credit and Equity, outlined the dual benefits of the fund: “1GT’s close represents the best of Morgan Stanley’s thinking around delivering fiduciary returns to our clients while providing transparent, transformational climate impact.” The fund operates under Article 9 of the Sustainable Finance Disclosure Regulation, ensuring that all investments promote environmental characteristics and incorporate sustainability comprehensively into the investment process.
A Portfolio for the Future
1GT has already made significant investments in companies like Instagrid, Huel, and Everstream Analytics, which contribute to sustainable mobility, nutrition, and supply chains, respectively. These investments reflect Morgan Stanley’s broader strategy to foster business growth while enhancing climate change mitigation and improving ESG practices across industries.
With a clear focus on achieving tangible climate results and fostering economic growth, MSIM’s 1GT fund sets a new benchmark for climate-focused investment strategies, driving forward both environmental and financial sustainability.