Related tags: Mirova - Private Equity - ESG Investing

Impact Private Equity

Private equity to accelerate positive impact on environment.

Private Equity to Accelerate Positive Impact on Environment
The world is faced with urgent, global and interconnected environmental challenges: global warming, air, water and land pollution, non-sustainable resources exploitation, waste, food and water insecurity, deforestation, biodiversity loss.... Solutions exist, but they need financing to scale up and become sustainable and replicable business models.

As well as public markets investors, private equity investors have a critical role to play in the “decade of action” with less than 10 years to achieve the SDGs and fulfil the annual financing gap of $2.5T1 ( Source: United Nations - Sustainable Development Goals Business Forum) needed.

As green infrastructure has developed into a mainstream asset class and the - venture capital (VC) benefits from a dynamic and flourishing ecosystem, the next generation of impact investments opportunities are expected to be in the “Acceleration capital” stage. Capital injection is critical to scale up innovations and businesses with virtuous, environmentally-positive business models.


A Private Equity Strategy Centered Around Five Investment Themes
Mirova's impact-driven private equity focuses on five sectors which offer numerous opportunities for impactful and profitable investments over the long term. 
 A Private Equity Strategy Centered Around Five Investment Themes


A Private Equity Strategy Aligned with the SDGs
In line with Mirova's investment philosophy, Mirova Environment Acceleration Capital looks for companies and projects able to provide solutions contributing to achieve the UN Sustainable Development Goals (SDGs).

impact at the heart of the investment process


Mirova Environment Acceleration Capital in a Nutshell

The Opportunity

Seeking to accelerate positive impact on environment while targeting attractive & sustainable financial returns through private equity investments.

The Rationale Behind Allocating to Impact Private Equity

  • Protecting Environment
    • Private Equity investors have a critical role to play in the “decade of action” with less than 10 years to achieve the SDGs & fulfil the annual financing gap of $2.5T1 needed
  • Having an Impact
    • After green infrastructure & a flourishing ecosystem of VCs, the next generation impact investments are expected to be in the private equity acceleration stage where capital injection is critical to scale up innovations & businesses
  • Accessing Attractive Risk/Return
    • Companies solving key sustainable development issues are expected to deliver substantial financial rewards

Key Competitive Advantages

  • An Innovative Private Equity Solution
    • Target Pan-European companies with strong ESG standards in 5 key sectors with a direct connection to the environment (natural resources mgt, agri-agro technologies, circular economy, clean energy & smart cities)
      • Focusing on innovative green solutions/technologies addressing environmental challenges
      • Using a virtuous business model targeting 9 SDGs directly (3,6,7,9,11,12,13,14,15) & 3 indirectly (5,8,10)
    • Invest in diversified sectors to help minimize risk
    • Evaluate impact during all the investment cycle – impact business plan & linked KPIs, progresses reported to investors, 50% of carried allocation subject to impact achievements
    • Aim to deliver compelling returns through profitable businesses providing tailwinds for growth & value creation
  • Mirova: A Recognized Player of Impact and Private Investments
    • Leading pure player of impact – Mission-driven frim3, B-Corp label certified4, 100% of its funds SFDR Art.95
    • Combined know-how & experience in all the verticals in private assets leveraging the deep pool of Mirova’s existing expertise – Energy Transition Infrastructure, Natural Capital, Social Impact & Sustainability Research
    • Privileged access to deal-flow & investment opportunities through Mirova’s strong network of partners – BPCE, Natixis, Mirova, VC & Corporate VC, Specialised & generalist FAs, entrepreneurs, etc.
    • Strong operational platform with a proven track-record in private investments – €2.3bn of AuM6

At a Glance

The main expected characteristics of the strategy are the following:

  • Investment Manager: Mirova
  • Type: Illiquid
  • Asset Type: Private Equity Impact Investing
  • Region: Pan-European (with 20% ex-Europe pocket)
  • Sector Diversification: Agri-agro technologies, natural resources, circular economy, clean energies, smart cities
  • Maturity: 10 years (+2 years at investors discretion)
  • Main Risks: Capital loss, deal flow, counterparty, liquidity, country, operational, regulatory, compliance, currency, ESG investing methodological limits, sustainability risk


1 Source: United Nations - Sustainable Development Goals Business Forum

2 Environmental, Social and Governance

3 Mirova is a mission-driven company since 2020. For more information : www.entrepriseamission.com

4 Since 2006, the B Corp label has been promoting strong values of change throughout the world to make companies "a force for good" and to distinguish between those that reconcile profit (for profit) and collective interest (for purpose). The B Corp's objective is to certify companies that integrate social, societal and environmental objectives into their business models and operations. www.bcorporation.net/about-b-corps. Mirova is B-corp certified since 2020

5 For the funds exclusively managed by Mirova. “SFDR”: Sustainable Finance Disclosure regulation. Article 9, i.e.: “a financial product which has sustainable investment as its objective, not a result”, in opposition with article 8 “E&S characteristics are promoted among others. We do not view product classifications as of this date to be final, and it is possible certain product classifications could change thereafter. The SFDR requires each investment team to consider carefully how to express ESG and sustainability principles, which we view as critical and ever-growing aspects of our investment activities on behalf of our clients.

6 Source Mirova (31/08/2021)

Published in October 2021.

Mirova
Affiliate of Natixis Investment Managers French Public Limited liability company
Share Capital: €8,813,860
Regulated by the Autorité des Marchés Financiers (AMF) under n° GP 02014.
RCS Paris n° 394 648 216
59 avenue Pierre Mendès France
www.mirova.com

Natixis Investment Managers
RCS Paris 453 952 681
Share Capital: €178 251 690
43 avenue Pierre Mendès France
75013 Paris
www.im.natixis.com

This communication is for information only and is intended for investment service providers or other Professional Clients. The analyses and opinions referenced herein represent the subjective views of the author as referenced unless stated otherwise and are subject to change. There can be no assurance that developments will transpire as may be forecasted in this material.

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