Funds are starting circular economy investments

Sustainability Dialogue: Financing & Investing
Fund management firms have only started implementing circular economy it in a fund format. Blackrock, for instance, has teamed up with Ellen McArthur Foundation.

In October 2019, BlackRock announced the launch of its first circular-economy-themed fund in cooperation with the Ellen MacArthur Foundation.The Fund aims to drive investments in businesses already contributing to, or benefiting from, the transition to a circular economy. The Foundation provides BlackRock with expert insights and guidance on circular economy principles and practices, which are used by BlackRock to inform the investment methodology of the Fund.The Ellen MacArthur Foundation considers the partnership and fund as important milestones towards its broader agenda of unlocking the power of finance and investments to scale the circular economy. The Foundation is looking to increase its work in this area over the coming months and years, working with its Global Partners BlackRock and Intesa Sanpaolo, as well as other financial institutions and stakeholders. The Foundation will support them to accelerate the transition by allocating capital, providing services, and engaging companies on the circular economy.

However, BlackRock  is not the first asset management firm to launch circular-economy-branded strategy. One of the first was Geneva-based boutique Decalia, which launched its Decalia Circular Economy fund in June 2018.

The fund is managed by Clement Maclou, who also oversees the Millennials and Silver Generation funds, and currently has around €30 million in assets under management.

Unlike the BlackRock strategy, which relies on Ellen MacArthur Foundation to dinform its investment universe, Decalia is using its own in-house capabilities, having identified 580 companies across Europe, the US, Japan and the emerging world that fit the theme.