PE managers still underestimate impact of green finance – Guernsey Finance research

01 July 2019

Reporting Global Developments - Private Equity & Green FinanceAs part of its contribution to London’s climate action week, Guernsey Finance today publishes findings suggesting the political backdrop is encouraging private equity managers to consider more investment in green and sustainable finance – but they also want to see more transparency in those funds.

Research carried out by Guernsey Finance has revealed rising interest in green investment from managers, but also flagged that they had underestimated the funding requirements and commercial opportunity for limiting global warming.

Three-quarters of those surveyed had increased exposure in green and sustainable finance and everyone planned to do so in the near future. They said that external drivers, such as investor demands and competitive forces, including the ‘Attenborough Effect’, where the veteran broadcaster David Attenborough is credited with making people more conscious about the impact of their consumption, were the main reason for doing so.

They also agreed that transparent verification and certification, such as that offered by Guernsey’s world-leading Guernsey Green Fund, a regulated fund offering verification that 75% of the fund’s investments are allocated in certified green assets, will catalyse investor demand. European firms were slightly keener on a regulatory product than US managers.

Guernsey Finance interviewed managers and service providers at this year’s SuperReturn conference in Berlin. The report has been published as part of its “Reporting Global Developments” series. Guernsey is a leading centre for sustainable finance and specialist private equity jurisdiction. It is a member of the United Nations’ network Financial Centres for Sustainability (FC4S).

Dominic Wheatley, Chief Executive of Guernsey Finance, said: “Our survey suggests that investors are building up activity in the green space, and that a clear, transparent certification process – such as the Guernsey Green Fund regulatory regime – is key to unlocking private equity for the climate finance cause.”

View the results of the research here.

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