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Laxman Pai, Opalesque Asia: Nuveen, the $1trn (€1trn) investment manager of US financial services group TIAA, has launched a global timberland strategy targeting natural climate solutions.
The US giant believes 'natural climate solutions' including better woodland management and carbon sequestration can reduce emissions while providing an inflation hedge for investors.
According to a media release, the strategy seeks to provide investors with targeted exposure to sustainable timberland investments in core geographies, including the U.S., Chile, Uruguay, Canada, New Zealand, and Australia.
As global investors seek to transition portfolios to net zero by 2050, timberland investments could play a significant role. The strategy provides a natural climate solution to reduce carbon emissions by producing more timber on less land, reducing emissions through efficient operating practices, and sequestering and storing carbon in soil and trees.
Natural climate solutions are the lowest-cost scalable route to climate mitigation and according to the World Resources Institute can provide up to 30% of the emissions reductions needed by 2030, it said.
According to the Wuppertal Institute for Climate, Environment, and Energy, global demand for timber is expected to grow by up to 200% by 2050, owing to increased demand from continued growth in the global population and per capita income, presenting a compelling return opportunity for timber production.
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