Singapore-based private equity (PE) manager Azalea Investment Management and financial services company Singlife with Aviva have launched the Altrium Sustainability Fund I (ASF I), which will invest in environmental, social and governance (ESG)-focused opportunities to achieve positive environmental and social outcomes, alongside PE financial returns.

ASF I, a PE fund-of-funds product that enables institutional and other accredited investors to build an ESG-focused investment portfolio, will back funds that invest in scalable, commercial solutions to solve pressing issues across its five core themes of climate, resource management, healthcare, education and financial inclusion.

Azalea will select high-quality managers that address the global challenges encapsulated in the United Nations (UN) Sustainable Development Goals for ASF I, the company says. The fund will focus primarily on buyout and growth strategies, leveraging on the strength and technical expertise of these managers to generate PE market returns. 

“Private equity is uniquely positioned to be a force for good through its long-term investment horizon and innate appetite for value creation,” says Margaret Lui, CEO of Azalea. “Investing through a sustainability lens not only builds a forward-looking portfolio, it also assures enduring value, thus enhancing the likelihood of resilient returns.”

In line with Azalea’s commitment to ESG, Azalea became a signatory to the Principles for Responsible Investments in 2021, a UN-supported global investor initiative that works in partnership with the UN Environment Programme Finance Initiative and UN Global Compact to promote the incorporation of ESG factors in investment and ownership decisions.

The asset manager has also signed up to the ESG Data Convergence Project, which seeks to standardize ESG metrics and provide a mechanism for comparative reporting for the private market industry. The collaboration now represents over US$8 trillion in assets under management with involvement from firms, including Carlyle, CVC and EQT AB.