UK pension scheme Nest announced today the appointment of J.P. Morgan Asset Management’s timberland investment advisory company Campbell Global to establish a new evergreen timberland fund.
Under the new agreement, Campbel Global will seek out opportunities for Nest in key global markets including the U.S., Australia, New Zealand and Chile, providing the pension scheme with a global portfolio of direct investments, focused on core traditional timberland.
Alongside the appointment announcement, Nest highlighted a series of sustainability-related and financial benefits from timberland investment, including the promotion of sustainable forestry practices enabling ecosystem services such as carbon capture, water filtration, soil preservation, and habitat for wildlife, in addition to stable returns with a cash yield, a natural inflation hedge and portfolio diversification.
Stephen O’Neill, Head of Private Markets at Nest, said:
“We believe the importance of preserving natural capital will only increase in the coming years. Many aspects of our ecosystem such as forestry, water and agriculture are closely linked to climate change mitigation and adaptation. Achieving net zero emissions by 2050 will require natural capital preservation.”
According to Nest, the appointment followed a competitive procurement process, with 12 fund managers applying to offer the pension scheme access to sustainably managed timberland. O’Neill said that in its selection of Campbell Global, Nest was “particularly impressed by the sophistication of their operations, responsible investment philosophies, and ability to work at scale to minimise operating costs while maximising integrated asset management.”
O’Neill added:
“We believe in Campbell Global we have found a partner that can grow alongside Nest, meeting our high bar for responsible investing – they’ve demonstrated they want to be good stewards of the environment and the forests, and the communities around the forests.”
J.P. Morgan Asset Management acquired Campbell Global in 2021, in a move aimed at providing direct access to the forestry sector and alignment with UN Sustainable Development Goals (SDGs), and enabling the firm to directly participate in transition to a low-carbon economy, with the company expecting to become an active participant in carbon offset markets as they develop.
John Gilleland, Chief Executive Officer and Chairman of Campbell Global, said:
“Timberland represents a unique investment that offers Nest’s members the opportunity to combine investment and sustainability goals, which include enhanced portfolio diversification, a hedge against inflation, carbon removal to help mitigate climate change, and the preservation of biodiversity.”