Hampden & Co in first-of-its-kind £2bn private finance pilot to help landowners restore woodlands

Hampden & Co has joined forces with NatureScot, Scotland’s nature agency, Lombard Odier Investment Managers and global impact firm Palladium in a private finance pilot to help restore Scotland’s native woodlands. The group is targetting landowners in Scotland who are interested in nature restoration and carbon capture programmes through capital investment.

The private finance investment pilot is aiming to mobilise up to £2 billion in landscape scale restoration of native woodland. If successful, the pilot could unlock private investment in natural capital, with the aim of reducing emissions and restoring biodiversity through landscape scale nature projects. It is also looking to create new jobs and support rural communities across all parts of Scotland.

The focus will be on creating new and, in some locations, productive woodlands. The carbon credits produced will only be sold to UK companies. A priority will be to quantify the impact of the investment and track and measure success. The investment model for each project will be adapted by the global impact firm Palladium, who have substantial global expertise in developing a portfolio investment approach.

The collaboration between NatureScot, Hampden & Co, Lombard Odier Investment Managers and Palladium is a ‘national first’ in ambition and scale, and an important first step in positioning Scotland as a world leader in nature restoration through natural capital investment.

Limited available public funds mean Scotland must attract significantly more private investment into restoring and growing its nature as a vital means of tackling the twin climate-nature crises.

The first pilot scheme will begin in the Spring of 2023. It is centred on the upper catchment of the River Tweed in Southern Scotland and will build on momentum already generated by the Wild Heart Borders Forest Trust project. This and every project will deliver against Scottish Government’s Interim Principles for Responsible Investment in Natural Capital, published in March 2022; and be designed to deliver tangible benefits for local communities.

The team will work closely with land managers and local partners to deliver high integrity, responsible investment in new and productive woodlands which lock up carbon. The additional investment will enable high quality design, delivering multiple benefits for communities and nature in a way that more traditional woodland projects cannot always afford. It will strike a balance between maintaining existing land use and nature restoration.

Andrew Bell, Chief Commercial Officer at Hampden & Co, said: “Landowners bank with Hampden & Co for our ability to meet their often-complex needs with a personalised and tailored banking service. This initiative presents an opportunity to help them and others to transition to new ways of developing their land to support the drive towards net-zero.”

Robbie Kernahan, Director for Green Economy at NatureScot, said: “We are delighted to be working with these businesses to deliver scalable investment in our natural capital in Scotland. To deliver the aims of the Climate Change Plan we need to bring private investment to Scotland and this new partnership will allow us to test a new approach.”