Schroders Capital’s new Sustainability and Impact report demonstrates tangible positive change delivered by private markets business
Schroders Capital, the specialist private market investor with $97.3 billion of assets under management[1], today publishes its Sustainability and Impact report evidencing how the firm’s private markets' commitments are contributing to decarbonisation and societal progress, while meeting clients’ return expectations and focus on delivering positive change.
The report offers in-depth insights into Schroders Capital’s investment focus on environmental and social issues across infrastructure, private equity, real estate and private debt and credit alternatives, while demonstrating the critical importance of sustainability in delivering long-term, competitive returns for private markets investors.
Georg Wunderlin, CEO, Schroders Capital, said:
“Sustainability is more critical than ever to deliver long-term competitive returns. It is simply a once in a generation business opportunity. Our ambition is to build a new type of private markets firm, one which is anchored in sustainability and delivers the superior performance and real-world difference our clients expect from us.”
Significant progress was made across all of Schroders Capital’s business lines throughout 2023 and the first half of 2024. The report spotlights the work Schroders Capital’s teams have been doing through detailed case studies for each asset class.
To date, Schroders Greencoat, Schroders Capital’s specialist renewables and energy transition infrastructure manager, has invested $12.6 billion across wind, solar and energy transition assets, generating 12.3TWh of renewable energy, avoiding 5.7 million tonnes of CO2[2] compared to what would have been generated by non-renewable energy sources, and powering 3.6 million homes[3]. Additionally, Schroders Greencoat has been the largest investor in UK green hydrogen[4]. Last year in the UK, Schroders Greencoat was also the first to launch a renewables-focused LTAF and a sister global semi-liquid Article 9[5] fund, recognising that broadening accessibility to private markets is crucial for steering more investments towards sustainability.
Evidencing Schroders Capital’s commitment to sustainability and impact, 64% of our private equity General Partners were UN Principles for Responsible Investment signatories in 2023, rising from 52% in 2022. Furthermore, Schroders Capital’s private equity SDGs-aligned co-investments have achieved 32% Net IRR[6], underlining our ability to balance financial returns with sustainable impact.
As the private credit market is set to double to $2.8 trillion by 2028[7], Schroders Capital reports the closing of its seventh sustainability linked loan by the infrastructure debt business, spearheading efforts to future-proof strategic infrastructure. Meanwhile, Schroders Capital reports that, to date, $817 million has been invested in Insurance-Linked Securities transactions specifically designed to contribute to reducing the 'insurance protection gap'. This is vital as, for example, in Asia, an alarming 85% of economic losses from natural disasters between 2014 and 2023 remained uninsured[8].
Schroders Capital has also delivered impact through its real estate business. With 1.29 million UK households on housing waiting lists, the Schroders Capital Real Estate Impact Fund, which has recently received £50 million from Homes England, has been focused on addressing the shortage in social and affordable accommodation, as well as the regeneration of town centres. More generally, there is a significant opportunity to deliver new homes in areas of high demand in Europe, seeking to maximise our positive contribution to the lives of residents, improving their ability to work, study and be healthier.
Schroders Capital also invested about $1 billion across 175 transactions through its impact investing specialist BlueOrchard, following the assessment of 444 investment opportunities.
Maria Teresa Zappia, Head of Sustainability and Impact at Schroders Capital, and Global Head of Impact Schroders, Deputy CEO BlueOrchard, said:
“Investors remain committed to sustainable and impact investing, despite immense challenges. We see a strong, ever-growing client demand for sustainable and impact investing across all segments and geographies. To deliver above and beyond on their imperatives, we strive to combine agile, diverse sustainability and impact capabilities with a seamless execution approach.”
Ingo Heinen, Global Head of Business Development and Product at Schroders Capital, added:
“This business is not about us - it is about those who entrust us with their money to drive change and create value. Building on Schroders' firmwide strengths and distinctive approach, we are here to solve investor needs with end-to-end propositions.”
Earlier this year, Schroders’ Impact Report was published which offers a comprehensive analysis of the contribution the firm’s Impact Driven portfolios make to the UN Sustainable Development Goals (SDGs).
For further information, please contact:
Rachael Dowers, Media Relations Lead, Private Markets | +44 207 658 2086 | |
Justine Crestois, PR Executive | +44 20 7658 5186 |
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Schroders Capital
Schroders Capital provides investors with access to a broad range of private market investment opportunities, portfolio building blocks and customised private market strategies. Its team focuses on delivering best-in-class, risk-adjusted returns and executing investments through a combination of direct investment capabilities and broader solutions in all private market asset classes, through comingled funds and customised private market mandates.
The team aims to achieve sustainable returns through a rigorous approach and in alignment with a culture characterised by performance, collaboration and integrity.
With $97.3 billion (£77.0 billion; €90.8 billion)* assets under management, Schroders Capital offers a diversified range of investment strategies, including real estate, private equity, secondaries, venture capital, infrastructure, securitised products and asset-based finance, private debt, insurance-linked securities and BlueOrchard (Impact Specialists).
*Assets under management as at 30 June 2024 (including non-fee earning dry powder and in-house cross holdings)
Schroders plc
Schroders is a global investment manager which provides active asset management, wealth management and investment solutions, with £773.7 billion (€912.6 billion; $978.1 billion) of assets under management at 30 June 2024. As a UK listed FTSE100 company, Schroders has a market capitalisation of circa £6 billion and over 6,000 employees across 38 locations. Established in 1804, Schroders remains true to its roots as a family-founded business. The Schroder family continues to be a significant shareholder, holding approximately 44% of the issued share capital.
Schroders' success can be attributed to its diversified business model, spanning different asset classes, client types and geographies. The company offers innovative products and solutions through four core business divisions: Public Markets, Solutions, Wealth Management, and Schroders Capital, which focuses on private markets, including private equity, renewable infrastructure investing, private debt & credit alternatives, and real estate.
Schroders aims to provide excellent investment performance to clients through active management. This means directing capital towards resilient businesses with sustainable business models, consistently with the investment goals of its clients. Schroders serves a diverse client base that includes pension schemes, insurance companies, sovereign wealth funds, endowments, foundations, high net worth individuals, family offices, as well as end clients through partnerships with distributors, financial advisers, and online platforms.
Issued by Schroder Investment Management Limited. Registration No 1893220 England. Authorised and regulated by the Financial Conduct Authority. For regular updates by e-mail please register online at www.schroders.com for our alerting service.
[1] As of 30 June 2024 (including non-fee earning dry powder and in-house cross holdings)
[2] The methodology for calculating carbon avoided was updated in 2023 and is based on the marginal generation displaced in each jurisdiction. This approach is the preferred option under Partnership for Carbon Accounting Financials (PCAF) guidance (‘operating margin’) for measuring carbon avoided.
[3] The number of homes powered is based on the average annual household energy consumption, using the latest reported figures, and reflects the portfolio’s annual electricity generation on the relevant reporting date for each region.
[4] As at 31 December 2023.
[5] An Article 9 Fund under SFDR is defined as “a Fund that has sustainable investment as its objective or a reduction in carbon emissions as its objective.”
[6] Schroders Capital, as at Q3 2023 in US$ and net of underlying fund fees, expenses and performance fees and gross of Schroders Capital fund fees, expenses and performance fees. It is not possible to present the investment vintage performance data net of Schroders Capital fund fees, expenses and performance fees as they vary according to the fund vehicles that invested. Source: Preqin, Schroders Capital, 2024.
[7] Preqin Insights: Private debt growth available here.
[8] Nikkei Asia Report here.
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