Toronto Atmospheric Fund (TAF) has selected two sustainability-focused firms to manage the equity portfolio of our endowment fund. Award-winning Generation Investment Management LLP, co-founded by former U.S. Vice-President Al Gore, is a research-driven fund with $6.9 Billion under management. Greenchip Financial Corp. is a Toronto-based firm specializing in environmentally-responsible investments.
TAF does not believe that financial returns must be sacrificed for environmental impact. The data increasingly indicate that investing with consideration to carbon and environmental risk factors can be expected to improve the risk/return profile of portfolios in a climate-stressed, carbon-constrained world. TAF’s investment policy calls for an alignment between the organization’s greenhouse gas emissions reduction mandate and its investments.
These two firms are pioneering a proactive approach by investing in companies that have solid business and sustainability fundamentals or are specifically focused on low-carbon solutions like energy efficiency and clean energy. Both firms were selected based on their success in delivering strong returns, as well as their focus on sustainability — economic, environmental, social and corporate governance factors – that will drive down carbon and drive up financial returns over the long term. As a prudent, mandate-driven impact investor, that is exactly what TAF was looking for. .
Since 1991 TAF has managed a $23 million endowment provided by the City of Toronto to support the reduction of air pollution and greenhouse gas (GHG) emissions in the city. During that time, TAF has invested and maintained the endowment while using the earnings to support a wide variety of local climate solutions. Projects supported by TAF have helped the City of Toronto save more than $55 million to date on its energy costs. TAF operates at no cost to city taxpayers.
In addition to investments in marketable securities, a separate portion of TAF’s endowment is dedicated to financing local companies’ projects that yield a double bottom line: market rate of return on investment and GHG emission reduction. For instance, TAF has provided loans for construction of energy efficient condominiums, energy efficiency retrofits of high-rise and institutional buildings, installation of solar hot water systems, renewable energy facilities and upgrading of street and laneway lighting. A volunteer blue-chip investment committee guides TAF’s investment strategy and supports the organization’s impact investing innovation and leadership.
TAF is a founding member of the Carbon Disclosure Project, a rapidly growing group of companies and investors that provide and use information about carbon risk exposure and a signatory to the Principles of Responsible Investing developed by the United Nations Environment Program.