BNP Paribas AM Launches Sustainable Forestry Fund
BNP Paribas Asset Management (BNPP AM) announced today the launch of the BNP Paribas Future Forest Fund (FFF), a new fund targeting investments in sustainable forestry. BNPP AM said that the new fund is being launched amid global demand for sustainable managed timberland investments.
According to BNPP AM, the new fund, categorized as Article 9 under the EU’s SFDR regulation, will aim to generate financial returns for investors, and combine sustainable investment practices to combat climate change, improve asset resilience, and enhance biodiversity.
The fund is the first to be launched by BNPP AM in partnership with International Woodland Company (IWC), a Copenhagen-based company in which BNPP AM acquired a majority stake in 2022, that specializes in providing investment management and advisory services within sustainable forest investments, agriculture investments, and ecosystems restoration.
Earlier this year, BNPP AM released its new Global Sustainability Strategy, which included plans to substantially increase climate and environmentally themed investments, strengthening the firm’s range of nature-based solutions and establishing a new forestry fund.
Maxence Foucault, Senior ESG Specialist, Private Markets at BNPP AM, said:
“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. The Future Forest Fund illustrates the common vision we have with IWC to actively contribute to the environmental transition. 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.”
BNPP AM announced that it has already raised $130 million at the first close of the new sustainable forestry fund, and has set a target size of $500 million, with a hard cap of $750 million.
The target portfolio will consist of 8 to 12 assets in the United States (South, Northeast, and Pacific Northwest), Australia, New Zealand, and Europe. BNPP AM said the fund will only invest in FSC (Forest Stewardship Council) certified or other certifiable forests and provide investors with plug-in data for their greenhouse gas accounting targets and any regulatory reporting needs, including those in the EU.
According to BNPP AM, sustainable forestry investments offer an opportunity for investors to align environmental and social benefits with financial objectives, with demand for wood continuing to grow, driven by mega-trends including population growth, urbanization, increase in per capita income, and a green transition, while offering environmental benefits from sustainable forestry such as addressing climate change by removing and storing carbon, safeguarding and improving terrestrial biodiversity, and offering protection against deforestation.
David Vaillant, Global Head of Finance, Strategy and Participations at BNPP AM, and Chairman of IWC, said:
“The BNP Paribas Future Forest Fund represents a significant step forward to bring sustainable forestry investment into the mainstream and recognizes timberland as a compelling investment proposition. With this fund, we ensure that our focus on commercial viability is balanced with a strong commitment to protect and enhance biodiversity and climate resilience. We are proud to collaborate with BNP Paribas Asset Management to create a fund that aligns financial objectives with the urgent need for environmental stewardship.”