UBS aims to generate $5 billion for so-called impact investments. It has come a step closer to its goal making available assets for a U.S. fund.
UBS has raised $225 million from private clients for an impact investment fund managed by KKR, the Swiss bank said in a statement on Wednesday.
UBS, the world’s biggest wealth manager with $2.3 trillion under management, the investment isn’t important in terms of size. However, as UBS in 2017 pledged to the United Nations to make available $5 billion within five years for impact investments, the deal is nonetheless highly significant.
United Nations Goals
The UN had defined 17 social development goals (SDG) for its sustainable development project. To reach its target, the global organization needed to sign up support from the private sector, with banks and asset managers targeted for investments in sustainable projects.
The business with such investments has boomed since the UN started its program, with the private sector acknowledging the sustainable segment as a means to boost its own wealth management business.
Good Business Opportunity
As UBS is finding ways to fulfill its pledge to the UN, it is now resorting to a deal with KKR, one of the world’s biggest private-equity firms.
KKR, named after founders Kohlberg, Kravis and Roberts, and rivals once were deemed barbarians because of their heavy-handed approach in takeovers. Nowadays, KKR, Blackstone and Apollo are better known for investments that comply with the SDGs.
«The KKR Global Impact Fund invests in businesses providing commercial solutions that contribute measurable progress toward one or more of the UN SDGs,» said UBS in its statement. «Specifically, the strategy is focused on opportunities where financial performance and societal impact are intrinsically aligned and there is no trade-off between positive impact and financial outcomes.»
