Avendus Capital arm to launch environment-focused impact fund

Alternate asset management firm Avendus Capital today announced its plans to launch an impact fund, with a focus on environment, social and governance.

To be called ESG (environment, social and governance), the fund will be launched by Avendus Capital Public Markets Alternate Strategies, the company said without disclosing details about the corpus and the launch date.

The ESG fund, which the company claims to the first of its kind in the country, is a type of sustainable investing, an umbrella term for investments that seek positive returns, and evaluates the long-term impact of business practices on society, the environment and performance of the business.

To spearhead the initiative, Avendus has tied up with Institutional Investor Advisory Services (IiAS), which will supply a ranking framework covering ESG principles, the company added.

Rakesh Mohan, a former deputy governor of the Reserve Bank of India, and Amit Tandon, co-founder and managing director of IiAS, have been appointed on the fund's advisory board, while Abhay Laijawala, an ex-Deutsche Securities head, will be the lead fund manager, Alok Vajpeyi, chairman of Avendus Capital Public Markets Alternate Strategies, said.

"Globally, 26 per cent of total assets are managed under socially responsible investments, up from USD 13.6 trillion in 2012 to USD 22.9 trillion now," said Abhay Laijawala, managing director and fund manager at Avendus Capital Public Markets Alternate Strategies.

Since American institutional investors are increasingly incorporating social impact considerations in their investment decisions, foundations and endowments are integrating ESG strategies, as a result 43 per cent of them evaluate ESG factors before investing now against 22 per cent in 2013, he noted.

Avendus Capital Public Markets Alternate Strategies had launched an absolute return fund in March 2017 and followed it with an enhanced return fund in December 2017.

Collectively, these two funds have raised close to USD 1 billion within the 15 months of launch.