Temasek Holdings and BlackRock have partnered, with the environment at heart, to invest in private companies that use technology to reduce carbon emissions. Called “Decarbonization Partners”, the two investors will launch a series of late-stage venture capital and early growth private equity investment funds.
Temasek and BlackRock plan to commit a combined $600 million in initial capital to invest across the funds, which would also raise money from third-party investors. The first fund has a target of $1 billion, and will include capital from both companies. According to CNBC, the Decarbonization Partners will invest in early stage growth companies in areas such as electric and autonomous vehicle technologies, battery storage, grid solutions and emerging fuel sources.
Larry Fink, chairman and CEO of BlackRock, in a joint statement said the world cannot meet its net zero ambitions without transformational innovation. “For decarbonisation solutions and technologies to transform our economy, they need to be scaled. To do that, they need patient, well-managed capital to support their vital goals,” he explained.
Fink highlighted that the partnership will help define climate solutions as a standalone asset class that is essential to the two companies’ collective mission, as well as a historic investment opportunity created by the net zero transition.
BlackRock, the world’s largest money manager, is pushing companies to disclose how they will survive in a world of net-zero greenhouse gas emissions. The company believes that better disclosures about sustainability are in the best interest of companies as well as investors.
Meanwhile, Temasek has committed to halve emissions from its portfolio by 2030, and plans to eventually move to net zero emissions by 2050. Dilhan Pillay, CEO of Temasek International, believes bold, aggressive actions are needed to make the global net zero ambition a reality. “Through collective efforts with like-minded partners, we will be able to create sustainable value for all of our stakeholders over the long-term, and investors will have the opportunity to help deliver innovative solutions at scale to address climate challenges.”