France-based BNP Paribas Asset Management (BNPP AM) has unveiled the Future Forest Fund, a new Article 9 EU Sustainable Finance Disclosure Regulation product. The fund will invest in sustainable forestry assets that will generate strong financial returns, combining sustainable investment practices to combat climate change, advance asset resilience, and bolster biodiversity. The vehicle has a target size of US$500 million – with a US$750 million hard cap – and had a first closing of US$130 million this month. According to BNPP AM, sustainable forestry investments offer investors an opportunity to align environmental and social benefits with financial objectives, as well as play a “significant role in investment portfolios”. The UN Food and Agriculture Organization has projected wood demand to increase by between 37% and 60% by 2050 from 2020 levels. The fund is the first launched by BNPP AM in partnership with Danish global natural capital specialist IWC, in which the asset manager has a majority stake. IWC currently oversees over US$6 billion of natural capital investment programmes globally. “We are very pleased to partner with IWC and leverage their deep expertise in natural capital, ensuring that we make a meaningful impact in the world of sustainable forestry,” said David Vaillant, Global Head of Finance, Strategy and Participations at BNPP AM and Chairman of IWC. “This new fund will enable us to answer our clients’ growing interest in this new asset class as we widen our breadth of natural capital solutions.”
