Cambridge-led coalition to seed £500m fossil-free cash investment fund

The nearly £500 million fund will make it possible for the 79 UK colleges, universities and other institutions involved in the coalition – formed by the Banking Engagement Forum based in the Dept of Land Economy at the University of Cambridge – to make short-term cash-like investments without contributing to fossil fuel expansion within capital debt markets.

“This is the first cash fund we know of that will avoid providing liquidity to financial institutions who continue to finance companies that are building new infrastructure, such as coal- and gas-fired power plants, which will lock in fossil fuel combustion for decades,” University of Cambridge Chief Financial Officer Anthony Odgers said.

The new “quasi-money market fund” is part of a broader movement towards climate-conscious investing, appealing to a diverse range of investors including universities, local authorities, pension funds, insurers, and others with substantial cash to invest and committed to doing so responsibly.

The fund will filter out fossil fuel companies, utilities, banks, insurers, and other companies that contribute to fossil fuel expansion. Companies that are excluded from the list can be readmitted if they stop engaging in or facilitating fossil fuel expansion.

The HEI coalition has indicated they collectively expect to invest in the first instance close to £500 million in the product. The fund is expected to launch towards the end of 2025, with more seed investors also expected to join prior to launch.

Coalition members include the University of Oxford, London School of Economics, University of Edinburgh, University College London and 75 other leading UK institutions. 

“This initiative offers a practical and credible path for aligning our financial decisions with our climate commitments and institutional values. This provides a solution to institutions that is wider than the higher education sector and which will hopefully act as a catalyst to concrete change,” Oxford Group Treasurer Sean Anderson said.

Amundi is a leading European asset manager, which manages more than €2.2 trillion of assets.

“At Amundi we are committed to the view that delivering strong stewardship as well as expert responsible investment solutions will facilitate the transition to an inclusive, low carbon economy while delivering stable, long term sustainable value for clients. This product, developed for the UK’s leading universities and higher education institutions, reflects a growing recognition among UK investors of the importance of these efforts in supporting long-term social, environmental and economic benefits,” said Jean-Jacques Barbéris Head of Institutional & Corporate Clients Division and ESG at Amundi.