Hedge Funds Are Planting Avocado Trees to Prove They’re Pro-Environment
If you're going to offset your carbon footprint, you might as well do it with a trendy fruit.
The idea that “money is power” sounds inherently nefarious, but money can have the power of good as well. As Bloomberg recently reported, hedge funds control a mind-boggling $3 trillion in assets—and though the phrase “hedge fund” also doesn’t come with the best connotations, some of them are now trying to use their money-equals-power position to convince the companies they’re invested in to be more environmentally-friendly. And at least one hedge fund has reportedly even taken to planting avocado trees to prove its carbon-reducing bona fides. It doesn’t get any greener than that… at least guacamole-ly speaking.
In an article entitled “Avocados Are the New Coal for Hedge Funds Chasing Sustainable Cash” published to Bloomberg Green, author Nishant Kumar specifically highlights the $12.5 billion London-based fund Algebris which he writes is “planting 25,000 eucalyptus, mango, orange, avocado and papaya trees across villages in Tanzania to offset its carbon footprint, joining everyone from the World Economic Forum to YouTube influencers in such programs.”
“Investing is our mission and ESG [Environmental, Social, and Governance] is our soul,” founder and CEO Davide Serra was quoted as announcing when unveiling his fight against climate change last month. (Global warming is certainly impacting some of the most expensive wines in the world.)
Interestingly, however, though planting avocado trees may be headline-grabbing, Bloomberg seems to suggest that the real environmental champions in the financial world are actually putting their mouth where their money is. Chris Hoss—head of TCI Management Fund and its $30 billion in investments—is reportedly telling the companies in his company’s portfolio to either reduce their carbon footprint or face financial repercussions. He even apparently hammered home his environmental commitment by serving vegan food during a recent investor day.
Of course, in the financial world, motivations can be multifaceted. Part of this newfound appreciation of environmental issues may simply be that they’re trendy—and the funds that support these issues is where people want to put their money. But as Adam Jones from the investment advisory firm Albert E Sharp told Bloomberg, don’t worry about what’s happening behind the scenes as long as the outcome is beneficial. “Whether one views this as a marketing ploy or a more genuine effort to mitigate their environmental impact, the outcome is unquestionably positive,” he was quoted as saying.
When have avocados ever been used as part of a marketing ploy? Except maybe lots of times…