Caisse des Dépôts, the institution overseeing France’s €15.48 billion public sector pension fund, Ircantec, has made a significant move in sustainable finance by awarding a $1.8 billion equity mandate. The agreement, signed in December 2024, entrusts Nomura Asset Management with managing a customized sustainable equity fund that will focus on companies with a high positive impact on stakeholders. This strategic move aligns with Ircantec’s broader environmental and social goals while supporting the transition to a greener economy.
Tailored Sustainable Investment Strategy
The mandate is a bespoke version of Nomura’s established Global Sustainable Equity Fund, which has been operational for over six years. In response to Ircantec’s unique needs, the fund has been adapted to include both environmentally enhanced and Sharia-compliant options, catering to diverse investor requirements. This customization was key to Nomura’s success in securing the mandate, according to Alex Rowe, lead portfolio manager at Nomura Asset Management: “Tailoring the strategy for the client reflects a growing trend in sustainable investment towards bespoke, partnership-driven approaches.”
Ircantec’s Commitment to Climate Goals
A significant aspect of the mandate is Ircantec’s commitment to aligning its investments with the targets outlined in the Paris Agreement. The pension fund aims to reduce its carbon emissions by 7% annually, covering Scope 3 emissions, which include indirect emissions from supply chains and product use. In addition, nearly 20% of Ircantec’s portfolio will be allocated to energy transition investments, underscoring the fund’s dedication to supporting sustainable development and mitigating climate change.
The Bigger Picture
This move highlights a growing shift in the public sector pension fund’s approach to investing, with an emphasis on sustainability and long-term impact. By working with Nomura, Ircantec ensures its investments not only meet rigorous financial standards but also align with the global imperative for climate action. As governments and institutions around the world increasingly seek to integrate sustainability into their portfolios, this partnership sets a benchmark for how pension funds can contribute to the green economy while meeting their fiduciary responsibilities.
In conclusion, Ircantec’s $1.8 billion commitment represents a crucial step in the evolution of sustainable investing, setting the stage for future efforts by public sector funds to drive positive environmental and social outcomes.
