Manulife Investment Management has announced the launch of Manulife Forest Climate Fund.
The closed-end fund for US investors focuses on sustainably managed forests where carbon sequestration is prioritized over timber production and will consist of a portfolio of sustainably managed forestland assets. Manulife IM says that it is seeking to ensure the strategy, if offered outside of the United States, will comply with the requirements of Article 9 of the EU Sustainable Finance Disclosure Regulation.
The fund will focus on acquiring forests with strong carbon potential and high conservation value, in addition to implementing sustainable forest management plans. It intends to use carbon credits, conservation easements, value-added strategies, and limited timber harvests to generate high-integrity climate benefits and financial returns for investors.
The fund will pursue carbon insets through sequestration embedded within the investment portfolio, with the objective to provide investors with long-term supplies of high-quality carbon credits aligned with Manulife Investment Management’s carbon principles and lower exposure to market volatility. Manulife is intending to make available its Forest Climate Strategy as an opportunity to institutional investors globally and will be subject to local ESG regulations.
“Manulife Forest Climate Fund’s ability to align with the climate goals of our investors and key stakeholders is enhanced by our experience, size, global scale, and reputation in the market for developing and managing global timberland portfolios and carbon markets,” said Tom Sarno, global head of timberland investments, Manulife Investment Management. “We believe high-integrity, verified carbon credits will continue to be viewed as premier decarbonization instruments and that, in time, such carbon markets will eventually come to resemble that of more traditional commodities.”