The Climate Finance Partnership (CFP) was first announced on 22 January and aims to direct capital into climate-related projects in developing countries. The fund brings together BlackRock, the world leader in asset management, Agence Française de Développement (AFD), the German Ministry for the Environment and the Hewlett and Grantham foundations.
The CFP plans to invest between $500 million and $1 billion in climate change mitigation projects in emerging countries. The funds will be invested in climate infrastructure in Southeast Asia, Latin America and Africa. This includes the production of renewable energy, energy efficiency in residential, commercial and industrial sectors, energy storage, and low-carbon transport services.
“The challenges linked to climate change require large-scale collective action,” says Rémy Rioux, Chief Executive Officer of AFD. “AFD Group is therefore proud to cooperate with BlackRock, through its private sector subsidiary Proparco, to accelerate the mobilization of private funds for climate action.”
The CFP is structured as an investment fund managed by BlackRock. There will be two types of investors: foundations and donors like AFD and KfW, and private investors. BlackRock will be in charge of making the investment decisions, in accordance with the established investment policy.
AFD will provide knowledge of climate issues in emerging countries and expertise in the field: environmental and social expertise, tools for measuring the impacts (carbon footprint assessment) as well as climate taxonomy (project eligibility will be determined based on the Common Principles adopted by multilateral development banks).
This project, like all projects monitored by AFD Group, will be subject to the same environmental, social and governance standards. These standards will apply to BlackRock and any other fund managers.
Through its subsidiary, Proparco, AFD will be part of the fund’s consultative committee to ensure the proper implementation of the investment policy. The most important points of this policy that pertain to governments cannot be amended without approval from France and Germany.
Original source: AFD
Published on 22 January 2019
