Morgan Stanley Investment Management (MSIM) has closed its 1GT climate solutions private equity fund, raising $750 million. Launched in November 2022, the fund targets decarbonization by supporting companies focused on reducing global carbon emissions. Its goal is to eliminate 1 gigaton of CO2 emissions by 2050, with investments in sectors like mobility, power, agriculture, and the circular economy. 1GT is classified as Article 9 under the EU’s SFDR regulation, and half of the team’s compensation is tied to achieving its emissions reduction target. The fund aims to deliver both financial returns and measurable climate impact.
Morgan Stanley Investment Management (MSIM) has successfully raised $750 million at the final close of its 1GT climate solutions private equity fund, aimed at decarbonization efforts. The fund, which was launched in November 2022, focuses on the ambitious goal of eliminating 1 gigaton of CO2 emissions by 2050.
Vikram Raju, Head of Climate Private Equity Investing at MSIM and leader of the 1GT strategy, expressed excitement about reaching this milestone. He emphasized that 1GT is a highly targeted fund providing growth-stage capital to companies whose products and services can substantially reduce global carbon emissions. According to Raju, the fund's transparent and measurable climate objective played a key role in attracting investors, as it aligns with their desire for impactful investments. In a unique structure, the incentive compensation of the 1GT team is directly linked to achieving the fund’s climate goals, adding accountability and commitment to its mission.
1GT is classified under Article 9 of the EU's Sustainable Finance Disclosure Regulation (SFDR), signifying its strong emphasis on sustainable investments. The fund aims to invest in growth-oriented companies across sectors such as mobility, power, sustainable food, agriculture, and the circular economy, with a focus on both North America and Europe.
David N. Miller, Head of Morgan Stanley Private Credit and Equity, highlighted the dual focus of the fund in delivering both strong financial returns and significant climate impact. He pointed out that the fund leverages Morgan Stanley’s expertise and global reach to provide growth-stage companies with access to essential insights, expertise, and resources needed to scale their climate-focused innovations.
By targeting companies at critical growth stages and ensuring clear, measurable outcomes, 1GT is positioning itself as a key player in the broader fight against climate change. Its strategy not only aims to support companies that are reducing carbon footprints but also offers investors the opportunity to contribute to global decarbonization efforts in a tangible way. As the climate crisis intensifies, funds like 1GT reflect the growing demand for financial vehicles that align profit with purpose, providing both fiduciary returns and meaningful environmental impact.
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