International savings and investment company M&G announced today that it will allocate up to £5 billion from its £136 billion With-Profits Fund to invest in sustainability-focused privately owned enterprises. According to M&G, the initiative will help meet the rising global demand for capital from innovative responsible enterprises, which are currently underserved by providers of institutional finance.
John Foley, Chief Executive of M&G plc, said:
“More and more customers are asking us to make a positive difference to the world through sustainable investment, while also seeking good financial returns to underpin their retirement.
“Many of the most attractive opportunities to do this are in private assets – new and existing companies and platforms which are not listed on an exchange. As a cornerstone investor in such enterprises, M&G can have a much greater influence in supporting their growth and on sustainability than we can in public markets.”
As part of this new initiative, M&G announced that it has formed a new, 25-strong investment team called Catalyst, with presence in London, Singapore, New York and Mumbai. The team’s mandate includes investing in private credit, real and financial assets and private equity, according to the stage and nature of the opportunity.
Catalyst will sit within the Private & Alternative Assets business at M&G, and will have a broad impact focus ranging from ESG risk management through to positive impact for vulnerable groups. M&G provided examples of investments in the pipeline, including SME and consumer financing, such as microfinance and trade receivables; asset and development financing such as affordable housing and energy from waste facilities, and technology investments with a positive social or environmental purpose.