Prudential launches two whitepapers on climate transition financing

Written by Adam Cadle

23/09/2024

Prudential has launched two whitepapers on climate transition financing.

The first outlines a framework that integrates emerging market considerations when investing in energy transition.

Due to the absence of a standardised definition of transition finance, Prudential has developed its own proprietary approach where it has defined transition financing as investments directed into sectors and companies with the explicit intention of enabling and accelerating the net-zero transition. Prudential’s approach is principles-based, so that it can be applied across asset managers and asset classes.

The second paper, co-authored with Prudential’s asset management arm, Eastspring Investments, explores a practical investment approach that aims to outline how to construct a capital markets climate transition portfolio.

Ben Bulmer, chief financial officer, Prudential, said: “Our responsible investment strategy leverages our unique position as a large asset owner in Asia and Africa. Our presence in emerging markets in these regions gives us a unique voice on responsible investment. We use this opportunity to influence industry, peers and investee companies to consider the role that emerging markets must play in the global energy transition.”

In line with the launch of the financing the transition framework, Prudential is announcing investments in the following climate transition funds:

- Investment of US$200m as a founding investor in Brookfield’s Catalytic Transition Fund, Brookfield’s first dedicated fund for transition investing in emerging markets. The fund is a blended finance vehicle focused on directing capital into clean energy and transition assets in emerging economies.

- Committed up to US$150m to a climate-focused strategy managed by global investment firm KKR, which seeks to make infrastructure equity investments in Asia focused on the energy transition, including climate adaptation, climate mitigation and the brown-to-green transition.

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