Dive Brief:
- Sustainability-focused investor Just Climate announced last week it has secured $175 million in funding to scale investments in high-impact climate solutions and accelerate the transition to a carbon free economy.
- The financing was spearheaded by the California State Teachers’ Retirement System and Microsoft’s Climate Innovation Fund, both of whom also backed Just Climate’s inaugural $1.5 billion Climate Assets Fund in 2023.
- Just Climate is an offshoot of Generation Investment Management, founded by environmentalist and former U.S. Vice President Al Gore. Just Climate previously said its Natural Climate Solutions strategy will focus on avoiding emissions from agriculture, forestry and other land use. This also includes emissions sequestration through the restoration of soil, forest and wetlands, according to the September 2023 strategy announcement.
Dive Insight:
Earlier this year, Just Climate’s Natural Climate Solutions strategy made its first investment in NatureMetrics, a provider of biodiversity monitoring data and environmental DNS surveys, and participated in a $25 million funding round.
Just Climate said through such investments, its strategy “aims to deliver attractive returns and help transform land use to achieve global net-zero and nature positive goals.” The sustainable investor also said in the March 18 release that the strategy is “designed to support entrepreneurs with growth capital and business building support” to scale such climate solutions.
The exact contribution made by CalSTRS was not specified in last week’s release. The fund is the nation’s largest teachers’ retirement system and the second-largest public pension fund, with around $352.7 billion assets under management. Just Climate said the support of the California pension fund demonstrates the investment opportunity available to institutional investors that want to back “transformative scalable business models that support land-use transitions.”
The contribution from Microsoft’s Climate Innovation Fund was also undisclosed. The fund has committed $1 billion to boost technology development and deploy innovative climate solutions through equity and debt capital.
In addition to being an investor, the tech giant is also a founding member of the Just Climate Nature Alliance, a group of corporations focused on expanding investment opportunities in natural climate solutions.
“Our work with Just Climate and participation in the Just Climate Nature Alliance reflect our commitment to advancing nature-based solutions that drive high-integrity carbon removals, build resilient supply chains and protect biodiversity,” Microsoft’s Climate Innovation Fund Director Erika Basham said in last week’s release.
