RIO DE JANEIRO, Brazil | July 29, 2024 ― United States Secretary of the Treasury Janet Yellen, alongside South African Finance Minister Enoch Godongwana, praised continued progress being made by members of the Investor Leadership Network and the Bellagio Private Capital Mobilization Consortium toward its goals of increasing investment flows of institutional capital into emerging markets. The Bellagio Consortium was launched in Paris by Secretary Yellen as a partnership between the U.S. Treasury and the Investor Leadership Network – with the support of The Rockefeller Foundation – to undertake a variety of work aimed at increasing institutional investors climate- and development-aligned investment in emerging markets over the coming years.
Today’s announcement highlights progress made toward the Emerging Markets Transition Debt (EMTD) initiative. Under this initiative, investors have committed to invest $400 million into the energy transition in emerging markets, with a focus on investments in three areas: clean infrastructure, clean technology, and decarbonization.
As part of EMTD, ILN members Ninety One, CDPQ, and OMERS, alongside other institutional investors including the UK’s Legal and General Investment Management and Wiltshire Pension Fund, have expressed interest in contributing commercial capital to a new private sector initiative – “Emerging Markets Transition Debt”– a debt portfolio that will invest, subject to their customary approval requirements, an initial $400 million into the energy transition in emerging markets – with a focus on investments in three areas: clean infrastructure, clean technology, and decarbonization. For many of the investors involved, the participation in this initiative would represent a new step forward aimed at helping to close the important financing gap in the decarbonization of emerging and developing economies.
The purpose of the EMTD initiative is to provide companies in emerging markets with commercial financing to make critical investments, including in low-emission infrastructure and in heavy emitting companies with a credible transition plan—helping reduce carbon emissions and supporting the global energy transition. This approach is consistent with the goals of the Partnership for Global Infrastructure and Investment (PGII), an initiative that President Biden and G7 leaders launched in 2022.
Significant progress has been made since the launch in 2023. At COP28 in Dubai, the Consortium and the ILN announced a key partnership with the United States Trade and Development Agency (USTDA) to provide $100 million through a technical assistance funding window to help prepare projects in key emerging markets for investment. During the 2024 Spring Meetings of the World Bank and International Monetary Fund, the ILN, The Rockefeller Foundation, and the U.S. Treasury co-hosted a first-of-its-kind Forum for Chief Investment and Chief Risk Officers from institutional investment groups to address barriers to making these kinds of investments into emerging markets and developing countries to finance critical climate projects.
Hon. Janet Yellen, United States Secretary of the Treasury: “This new initiative advances key Treasury priorities. Since the start of the Biden-Harris Administration, Treasury has been actively pursuing work to promote economic growth, stability, and resilience in countries around the world, including by equipping countries to accelerate their energy transitions and realize their climate ambitions.
“To support these goals, President Biden and G7 leaders launched the Partnership for Global Infrastructure and Investment, through which we are driving investment flows into critical sectors that advance inclusive and sustainable growth and combat climate change around the world. And as part of PGII, we have been engaging with investors like those in the ILN to find ways to increase institutional investors’ climate- and development-aligned investment in emerging markets—leading to this new initiative.
“We are optimistic that all these efforts will lead an increasing number of investors to explore new opportunities in emerging markets, driving economic growth and dynamism.”
Marc-André Blanchard, ILN Co-Chair and Executive Vice-President and Head of CDPQ Global and Global Head of Sustainability, CDPQ: “Institutional investors have a leadership role to play in the transition and finance opportunities like the EMTD fund can provide a solution by focusing on private sector investments. Aligned with our goal to deploy constructive capital to decarbonize the global economy, this initiative – alongside the U.S. Treasury and ILN – demonstrates CDPQ’s desire to actively participate in the energy transition and to have an enduring impact.”
Hendrik du Toit, ILN Co-Chair and Founder & Chief Executive, Ninety One: “We are grateful to Secretary Yellen for her support as well as the investors who have anchored the strategy, including ILN members CDPQ and OMERS and UK investors LGIM and Wiltshire Pension Fund.”
“Momentum is building for the emerging market energy transition, and while there are real risks that need to be addressed in these markets, the perception of risk is much higher than realized risks historically. So far institutional investors’ investment in emerging markets has been largely focused on public listed equities and sovereign debt. However, much of the investment in the energy transition – particularly in middle income emerging markets- is required in the form of private equity, private debt, project debt and corporate debt. The Emerging Market Transition Debt initiative is a mechanism to both allocate capital to the emerging market energy transition and to catalyze further such investment. We believe that this is a crucial opportunity to have significant real-world impact for both climate and development goals. A successful global energy transition is not possible without a successful emerging markets transition.”
Amy Hepburn, Chief Executive Officer, Investor Leadership Network: “We are excited to stand here alongside Secretary Yellen, Minister Godongwana and our partners to celebrate this important milestone of progress for the Bellagio Private Capital Mobilization Consortium,” said Amy Hepburn, CEO of the Investor Leadership Network.”
“This milestone underscores that the right kinds of public-private partnerships, built to be focused on building trust among parties, learning from each other, and seeking new ways to look at old problems, can break down barriers that once seemed insurmountable. We are looking forward to continued progress from ILN members and Consortium, especially as we look toward our Global Investor Forum later this year in Cape Town, South Africa.”
Dr. Rajiv J. Shah, President, The Rockefeller Foundation: “To advance opportunity for vulnerable people and reverse the climate crisis, we must unleash institutional capital in emerging markets and developing countries. This initiative is proof of what’s possible when diverse partners come together to unlock private capital for critical energy transition, climate resilience, and other investments in the developing world. The Rockefeller Foundation is proud help advance this effort, which began in a convening at our Bellagio Center, and others to bring power – and progress – to those without electricity access.”
About The Emerging Market Transition Debt Initiative
The Emerging Market Transition Debt (EMTD) strategy is a new investment vehicle managed by Ninety One to catalyze investment into the EM energy transition. The strategy will aim to provide EM companies with commercial financing to support efforts in reducing real-world carbon emissions. It will provide credit to high-emitting companies which have strong potential to reduce emissions. This is a significant way to help bring about an energy transition, with the simultaneous goal of providing investors with an appropriate risk-adjusted return.
The EMTD strategy has been developed in collaboration with several global capital providers and advisors, including Cambridge Associates and Wiltshire Pension Fund.
About The Investor Leadership Network
The Investor Leadership Network was launched at the 2018 G7 to facilitate and accelerate collaboration by leading institutional investors to drive the transition to a sustainable and inclusive global economy. As the leading network of investors taking action for people, planet and prosperity, the CEO-led group is composed of 13 global institutional investors representative of six countries, with over US$10 trillion in assets under management.
Operating as an open and collaborative platform, members pool resources, expertise, and networks to develop, promote and deliver action-based and scalable initiatives on major global issues such as climate change; equity, diversity and inclusion; and private capital mobilization. Every initiative is evidence-based, measurable, and drives macro change. Member commitment is leveraged through a central convening body, the Secretariat, that threads the needle among initiatives and tracks and reports impact.
The ILN benefits from the participation and support of various partners, including governments, foundations, nonprofits, multilateral institutions, and other industry bodies, while remaining fully autonomous.
About CDPQ
At CDPQ, we invest constructively to generate sustainable returns over the long term. As a global investment group managing funds for public pension and insurance plans, we work alongside our partners to build enterprises that drive performance and progress. We are active in the major financial markets, private equity, infrastructure, real estate and private debt. As at December 31, 2023, CDPQ’s net assets totaled CAD 434 billion. For more information, visit cdpq.com, consult our LinkedIn or Instagram pages, or follow us on X.
CDPQ is a registered trademark owned by Caisse de dépôt et placement du Québec and licensed for use by its subsidiaries.
About Ninety One
Ninety One is an active, global investment manager managing £128.6 billion in assets (as at 30.06.24). Our goal is to provide long-term investment returns for our clients while making a positive difference to people and the planet. Established in South Africa in 1991, as Investec Asset Management, the firm began as a small start-up offering domestic investments in an emerging market. In 2020, as a global firm proud of our emerging market roots, we demerged to become Ninety One. We are committed to developing specialist investment teams organically. Our heritage and approach let us bring a different perspective to active and sustainable investing across equities, fixed income, multi-asset and alternatives to our clients – institutions, advisors and individual investors around the world. For more information, please visit NinetyOne.com.
About The Rockefeller Foundation
The Rockefeller Foundation is a pioneering philanthropy built on collaborative partnerships at the frontiers of science, technology, and innovation that enable individuals, families, and communities to flourish. We make big bets to promote the well-being of humanity. Today, we are focused on advancing human opportunity and reversing the climate crisis by transforming systems in food, health, energy, and finance. For more information, sign up for our newsletter at www.rockefellerfoundation.org/subscribe and follow us on X @RockefellerFdn and LI @the-rockefeller-foundation.
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Investor Leadership Network
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Ninety One
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The Rockefeller Foundation
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