The commitment will be made by transferring selected existing investments held by the Clean Energy Finance Corporation (CEFC) into the Fund, helping to establish a scaled, diversified portfolio of renewable energy, infrastructure, natural capital and climate tech assets. The CEFC commitment comes alongside a $500 million seed commitment from Australian Ethical.
Building on the established CEFC investment platform and more than a decade of climate-focused investment experience, the transaction supports the creation of a new institutional vehicle designed to broaden access to sustainability-aligned assets for the growing wholesale investor market.
Australian Ethical’s Growth Opportunities Fund is structured around five key thematics: decarbonisation, digitalisation, urbanisation, circular economy and changing demographics, and incorporates an impact measurement and management framework across the portfolio.
The CEFC will retain exposure to the underlying transferred investments through its participation in the Fund, while helping to crowd in private capital and expand access to climate positive assets for wholesale investors.
CEFC Executive Director Heechung Sung said the transaction reflects the evolution of Australia’s sustainable finance market: “This investment demonstrates how the CEFC can use its existing assets to help catalyse new market offerings and support the next phase of growth for sustainable finance.
“By backing a new institutional vehicle with CEFC investments, we are helping to establish a scalable platform for climate-focused assets, crowding in capital and expanding the reach of sustainable finance to a broader audience to accelerate Australia’s decarbonisation.”
Australian Ethical Chief Investment Officer Ludovic Theau said: “The biggest opportunity to capitalise on and support Australia’s net zero transition is in private markets. We’re leveraging our expertise, capability and networks to partner with some of the best specialists and managers to democratise access to these opportunities for wholesale channels, and we’re co-investing capital to take advantage of and support these opportunities together.
“We’re pleased to receive the support of the Australian Government through the partnership with the CEFC on this Fund. With the road to net zero before us, this Fund allows investors to capitalise on the long-term growth opportunity this presents and feel good about where their money is invested,” he said.
Australian Ethical’s Head of Private Markets Adam Roberts said: “This Fund provides immediate access to a wide range of private investments that deliver impact, and its open-ended structure provides flexibility to meet the needs of wholesale investors.”
The wholesale investor segment is a rapidly growing area that provides critical finance for innovation and is reshaping Australia’s investment landscape. An estimated 18% of Australians meet the criteria to be considered wholesale investors.1
The CEFC has delivered $97 billion in total transaction value over its lifetime, with $24.2 billion in CEFC commitments and $2.99 in lifetime private sector leverage for every dollar committed.
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