On 18 May, leading French pension fund ERAPF announced that it was investing €10m in La Française Inflection Point’s innovative CARBON ZERO global equities fund. Long recognized as one of the world’s most well-regarded sustainable/responsible investors, the €27 billion ERAPF’s investment is a significant vote of confidence, and brings CARBON ZERO’s total asset base to over €100m.
The CARBON ZERO fund, now two years old, was specifically designed to enable long-term investors to minimize the risks and maximize the opportunities generated by the world’s inevitable transition to a lower-carbon economy. At the same time, we have attempted to be pragmatic, recognizing that this transformation will not be an instantaneous one, and that we shall therefore have a certain level of dependency on hydrocarbon fuels for some years yet. For that reason, and to give our clients exposure to the full range of industry sectors, we have selected several best-in-class, conventional energy companies for the fund, in addition to companies which are retooling their business models to compete successfully in a lower-carbon environment. The third and final “sleeve” consists of pure-play “solution providers”, whose entire business models revolve around preventing or absorbing carbon emissions. The balance among the three sleeves of the fund is such that the fund’s net notional carbon emissions have been zero (or better) for the entire life of the fund — hence the name CARBON ZERO.
ERAFP (Établissement de retraite additionnelle de la fonction publique) is a state-supervised public sector administrative entity set up to manage the French public service additional pension scheme. Working under a chief executive officer appointed by joint order of ministers responsible for public service, budget and social security, ERAFP manages the Scheme’s investments directly or by delegation to asset management companies. Each year, its board of directors defines the Scheme’s technical specifications and also sets the general orientations of the Scheme’s fund investment policy.
As a responsible investor and signatory to the UN’s Principles for Responsible Investment (PRI), ERAFP evaluates each of its investments in the light of its impact in three main areas: social issues, governance and the environment. The organisation has its own SRI (Socially Responsible Investment) charter.
More information on ERAFP