Federated Hermes has launched a new fund in conjunction with researchers at the Natural History Museum to protect the variety of plant and animal life in the world.
The Biodiversity Equity fund will be run by Ingrid Kukuljan, head of impact and sustainable investing at the firm, and will be classed at Article 9 under Sustainable Finance Disclosure Regulation (SFDR) criteria.
It will focus on six key areas: land pollution; marine pollution and exploitation; unsustainable living; climate change; unsustainable farming; and deforestation.
The Natural History Museum has designed the Biodiversity Intactness Index, which predicts the loss of biodiversity in different regions, which the fund will use to inform its investments.
It uses a combination of land use, ecosystem, species and population data to give a simple figure for ‘intactness’, and will be an integral part of the fund’s investment strategy.
Kukuljan said: “The negative impacts of biodiversity loss pose a systemic risk to the global economy and we must stop taking nature’s permanence for granted. We are convinced that there is a cohort of quality, investible, stocks which provide investors profitable access to this megatrend.”
Dr Doug Gurr, the Natural History Museum’s director, added that the fund can help to “bend the curve of biodiversity loss and create a world in which both people and planet can thrive”.
Federated Hermes will also donate 5% of the net management fee revenue from the fund to the Natural History Museum.