1GT MSIM to invest in companies working to mitigate climate change

1GT MSIM to invest in companies working to mitigate climate change

  • The growth-oriented private equity platform 1GT (1GT or Platform) focuses on making investments in companies seeking to mitigate climate change
  • 1GT seeks to invest in companies that will collectively avoid or remove one gigatonne of carbon dioxide2– equivalent emissions from the Earth’s atmosphere from the date of the platform’s investment until 2050, the date on which the United Nations has determined “Net Zero” must be achieved
  • The 1GT team, led by Vikram Raju, Head of Climate Investment at MSIM, has been making investments in companies seeking to mitigate climate change since 2015 through and alongside several impact-oriented investment vehicles.
  • The team’s financial incentives for 1GT will be linked not only to achieving financial returns for 1GT, but also to achieving the platform’s climate goals.

Morgan Stanley Investment Management (MSIM) announced that it has launched the 1GT growth-oriented private equity platform (1GT or Platform) focused on investments in companies that will collectively avoid or eliminate one gigatonne of carbon dioxide (CO2e) equivalent.2e) Emissions from the Earth’s atmosphere from the date of the platform’s investment until 2050, the date on which the United Nations decided to achieve “net zero”. Part of MSIM’s $200 billion in alternative investments, 1GT targets investments in private companies based primarily in North America and Europe whose products or services enable a measurable improvement in the carbon footprint of their customers. The 1GT team has invested in companies seeking to mitigate climate change since 2015, deploying nearly $600 million in capital to date through and alongside several impact investment vehicles. For 1GT, the team will tie half of its stimulus compensation (generally known as carried interest) to underlying investments that collectively incentivize GtCO avoidance/reduction.2Electronic emissions from the date of the 1GT investment through 2050.

Vikram Raju, Head of Climate Investment and 1GT Platform at MSIM commented: “As COP27 concluded, it is now more clear than ever that we need to fundamentally change the traditional paradigm of impact private equity investment in three ways. First, we need to To the search for climate goals that are tangible rather than anecdotal and aspirational rather than episodic.Second, we believe that in order to catalyze meaningful progress on climate solutions, a significant portion of the financial incentives must be linked to these climate goals.Third, the measurement of these goals must be transparent to Limited Partners.Third Our goal is 1GT and 50 percent load linkage, we strived for exactly that.”

1GT targets investments in private companies that will generate meaningful financial return and positive measurable environmental impact across mobility, energy, sustainable food and agriculture, and the circular economy. The platform intends to leverage Morgan Stanley’s vast resources to partner with portfolio companies to help monitor ESG risk, increase climate change mitigation, improve ESG monitoring and reporting, track earnings growth, multi-expand, and enhance exit capabilities.

Navindu Katugampola, Global Head of Sustainability at MSIM commented: “1GT is another example of MSIM’s commitment to delivering innovative solutions and market-leading products that help our clients address time-critical sustainability issues while fulfilling fiduciary commitments to their investors.”

Source: Morgan Stanley Investment Management

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