Despite increasing challenges, ESG-focused funds and sustainable practices continue to remain in vogue for investors. Gautier Quéru, managing director of natural capital at Mirova, who has just launched three new impact nature-based carbon investments, shares his insights on sustainable investing with this news service.

Paris-based Mirova, an affiliate of Natixis Investment Managers focused on sustainable investing, has just released three new impact nature-based carbon investments, located in Argentina, Costa Rica and Madagascar, after raising over $350 million on this topic since 2020.

Mirova has a range of ESG-focused funds covered by Article 9 under the EU’s Sustainable Finance Disclosure Regulation (SFDR), including ecosystem conservation, biodiversity and sustainable agriculture, with investments ranging from precision agriculture, regenerative agriculture and technologies to reduce emissions from the sector.                    

The latest funding shows Mirova’s capacity to mobilise private capital to support high-integrity projects that contribute to climate change mitigation and adaptation, ecosystem conservation and restoration, improved livelihoods and wellbeing, as well as gender equality and inclusion, the firm said in a statement.

“We are witnessing an acceleration in the mobilisation of private and corporate investors who are increasingly recognising the critical importance of decarbonising their own activities but also to contribute to efforts beyond their value chains,” Gautier Quéru, managing director of natural capital at Mirova, said. “We are proud to present three new investees that promise to deliver strong positive impacts on both environmental and social fronts, while also offering attractive return potentials.”

Quéru believes that there is strong demand for nature-positive investments, with production often found in emerging markets, such as coffee.

The firm thinks that investors are rallying around nature conservation and regeneration because they understand how much of the economy and development are tied to managing and regenerating natural resources. 

Mirova has developed an investment expertise allied to "nature-based carbon assets" to enable institutional and corporate investors to contribute to global objectives of nature protection (Positive Nature) and carbon neutrality (Net Zero). The strategy aims to support high-quality projects targeted at protecting and restoring nature mostly in emerging markets, as well as supporting farmers in their transition to regenerative agriculture. Mirova aims to generate carbon credits and co-benefits for local communities, especially promoting women's independence.

Mirova’s approach is based on the understanding that carbon credits are essential tools for funding emission reduction projects around the world and contribute to achieving the goal of dedicating $300 billion per year to combatting climate change, as announced at COP29 in November 2024. To ensure the integrity of carbon credits, projects must adhere to strict criteria, including additionality, measurability, and permanence. Mirova said it applies rigorous standards to select projects that not only meet these criteria but also generate significant social and environmental co-benefits. 

Blended finance
Quéru also highlighted how blended finance has become a buzz word. Last year, Mirova mobilised a blended finance coalition for its second generation fund dedicated to sustainable land use. It gathered a coalition of investors and partners to support investments in regenerative agriculture, agroforestry, and sustainable forestry in emerging markets.

After establishing and deploying the Land Degradation Neutrality Fund (LDN) in partnership with the United Nations Convention to Combat Desertification (UNCCD), Mirova announced the support of key investors for the Mirova Sustainable Land Fund 2 (MSLF2), which reached its first closing and commenced operations last year.

The coalition comprised a mix of public, private, and philanthropic investors combining their resources through a blended finance approach: the SDG Impact Finance Initiative (SIFI), which plays a catalytic role as the first junior investor, alongside institutional investors Abeille Assurances, Allianz France, and BNP Paribas Cardif. This coalition also includes development finance institutions investors FMO and Proparco, who intend to commit investments for the forthcoming second close.

Additionally, the Rainforest Alliance will help create a robust project pipeline and support high-quality initiatives on the ground as part of the strategic partnership established with Mirova. Together, they aim to amplify locally led Nature-based solutions, and especially agroforestry projects that deliver significant benefits for climate, biodiversity, and local communities through targeted impact investing initiatives across Africa, Latin America, and Asia.

Sustainable land management and restoration are essential for addressing the challenges of climate change, biodiversity, water, and food security. It is important to attract more capital to support large-scale projects, particularly in emerging markets, where blended finance plays a key role in mobilising funds from institutional investors through risk mitigation mechanisms established by development finance institutions and philanthropic actors. This maturing sector, driven by increasing demand for sustainable food and strengthened regulation of supply chains, is fostering the emergence of a new asset class.

See more about Mirova here, an affiliate of Paris and Boston-headquartered Natixis Investment Managers, which has over $1.3 trillion assets under management,

Paul McMahon, a co-founder and managing partner of asset manager SLM Partners{/tag], also believes that there has been higher investor interest in regenerative agriculture and forestry recently. He believes that it has the potential to grow, and sees it as a real investment opportunity. See more here.