Sustainable Finance
Guernsey Green Fund Case Studies
In October 2018, the Cibus Fund became the first to be awarded the Guernsey Green Fund regulatory ‘kitemark’ by the Guernsey Financial Services Commission. It closed at more than $320 million following its designation.
“Clearly there were a number of contributing factors, but I do think an important factor in bringing in those later funds, getting investors who were thinking about it to actually commit, was the Guernsey Green Fund designation,” said Jeremy Alun-Jones, Group Chief Operating Officer at ADM Capital.
The Cibus Fund is a private equity vehicle managed by London and Hong Kong-based fund manager ADM Capital, a manager with a track record of investing in the agribusiness sector, looking to reduce the negative impacts of agriculture on the environment. It has followed a thesis-driven approach which shows that demand for high-value food in many of the world’s fastest-growing regions exceeds regional production and processing capacity.
True North Real Estate Partners’ first fund, the Forestry Carbon Sequestration Fund, was designated as a Guernsey Green Fund in summer 2020.
The Forestry Carbon Sequestration Fund will focus on woodland creation, acquiring agricultural land across the UK to develop as Forestry Stewardship Council-compliant commercial forestry. This ecologically-beneficial forestry planting is the central element to reaching the fund’s 1.65 million tonne carbon sequestration target.
The fund is structured with a co-investment ‘side car’, allowing it to scale up if larger investments are available. It achieved its £30 million equity target at launch, exclusively supported by leading global investment firm Willis Towers Watson.
True North was set up in 2019 to focus on ESG-motivated real asset strategies and to meet the increasing institutional investor demand for opportunities leading on environmental and social impact rather than addressing these issues as a passive reporting function to legacy investment strategies.
Insight Investment, a leading global asset and risk manager, received a Guernsey Green Fund accreditation for its farmland fund, the Global Farmland Fund Limited (GFF), which invests in farming projects worldwide. The GFF is actively managed, closed-ended, and Guernsey-domiciled. It closed to new commitments in February 2013.
Resonance British Wind Energy Income II, an authorised, closed-ended investment fund, is focused on consolidating the fragmented small and medium-sized wind farm industry in Britain and Ireland, offering investment return and mitigating environmental damage.
It is the manager’s third Guernsey fund, having previously launched a similar UK onshore wind fund and a fund focused on industrial water treatment, waste to energy and resource recovery infrastructure projects.
Resonance Asset Management is an alternative asset management firm focused on originating, distributing and managing real asset investment funds for institutional investors. Its focus is on assets in growing and changing industries with compelling long-term investment themes, with areas of focus including alternative and conventional energy, water and waste treatment, environmental and agricultural assets.
London-listed fund NextEnergy Solar Fund was awarded the Green Fund designation in February 2020.
NESF is a specialist investment company that invests primarily in operating solar power plants in the UK. It invests up to 15% of its gross asset value in operating solar power plants in OECD countries outside the UK, with the objective to secure attractive shareholder returns through RPI-linked dividends and long-term capital growth by acquiring solar power plants on agricultural, industrial and commercial sites.
Kevin Lyon, Chairman of NESF, said:
"As a board, we are proud of NESF's green credentials and our team's commitment to ESG principles and responsible investment. Achieving Guernsey Green Fund status is further testament to the positive environmental impact that NESF and its solar investments continue to deliver, in terms of both reducing CO2 emissions through solar power generation and championing biodiversity across our solar estate."
The Bluefield Solar Income Fund, advised by Bluefield Partners, was the first London-listed fund to be awarded the Guernsey Green Fund mark in April 2019.
It holds more than 80 UK-based solar holdings, targeting long-life solar energy infrastructure assets, expected to generate energy output over a 25-year lifespan, and with an explicit objective to mitigate environmental damage.
“ESG issues are of increasing importance to investors,” explained Bluefield Partners’ James Armstrong. “As we witness the growth in environmental-themed funds, it is vital that investors are able to easily, and transparently, see a fund’s green credentials.
“We expect the Guernsey Green Accreditation criteria will help investors make informed decisions about a fund’s environmental impact, set against a globally recognised standard.”
Earth Capital’s Nobel Sustainability Fund ® LP, advised by Carey Olsen, was awarded Guernsey Green Fund status in January 2021. The Nobel Sustainability Fund ® is a Guernsey limited partnership investing in private equity sustainable technologies focused across the themes of energy, food and water. The fund was launched by Earth Capital Guernsey Limited (EC) in conjunction with the Nobel Sustainability Trust ®.
Earth Capital use their award-winning Earth Dividend ™ tool to measure and manage the holistic sustainable development of a portfolio company, and by doing so have the potential to enhance value and support risk mitigation, thereby increasing returns on exit.
