In 2021, the focus of the company’s operations was on launching investment activities and making investment decisions, recruiting and inducting personnel, as well as developing the company and its administration. The Climate Fund made seven investment decisions totalling €45.5 million. A total of €12.6 million in funding has been paid out to these investments by the end of Q3/2022.
The Climate Fund's finances
Balance sheet, operative expenses and funding paid
The Climate Fund’s balance sheet is almost exclusively made up of an 8.3% stake in Neste Oyj, and the company’s balance sheet value thus varies with the price of Neste’s share. The Climate Fund has approximately €129 million in liquid assets for financing its operations (Q3/2022). These liquid assets are invested in bank accounts, fixed-term deposits and bond funds.
The Climate Fund’s operative budget for 2022 is €5.6 million, of which €2.6 million consists of personnel costs. The company’s second-largest expense item consists of due diligence and other expenses related to the preparation of investment decisions, totalling €2 million.
The companies invested in by the Climate Fund typically receive the funding in instalments over several years as conditions specified in the financing agreements are met. The target for 2022 is to make approximately €80 million in investment decisions for scaling up climate solutions.
Personnel costs, i.e. salaries, remuneration to Board members, and indirect costs, totalled roughly €1.7 million in 2021. Seven new employees were recruited during the year to enable the launch and growth of investment operations. A total of €2.6 million has been budgeted for personnel costs in 2022. The budget takes into account the nine new employees recruited during the year, seven of whom started work in the spring of 2022. In addition, two analyst trainees started in the Climate Fund’s Investments team and one trainee in the Communications and Sustainability team during Q3/2022.
The preparation of investment decisions involves due diligence audits commissioned from external service providers and other preparatory work, as well as legal services for drawing up the financing agreements. A company’s compliance with the Climate Fund’s financing criteria is ensured through external due diligence audits and other measures during the investment process. These external audits include an objective examination of the company’s business plans, emissions reduction potential and ESG issues, technology and production, the market, as well as finances, taxation and legal issues. In 2021, Climate Fund’s share of expenses related to due diligence audits, the preparation of investment decisions, and financing agreements was €0,95 million. This sum corresponds to approximately 2% of the year’s investment decision volume. The remaining expenses incurred by the investment decision preparation team were related to the launch of the Climate Fund’s investment operations, the development of the company, and projects initiated in previous years. A total of €2 million has been reserved for due diligence and other expenses related to the preparation of investment decisions in the 2022 budget, corresponding to roughly 2.5% of the €80 million target volume for investment decisions in 2022. A further €0.1 million has been set aside for the development of investment operations.
Communications and reporting costs include studies and surveys conducted in support of investment operations, the Climate Fund’s sustainability reporting and carbon footprint calculations, the company’s website and other external communications, membership fees of sustainable investment organisations, as well as various events. Due to the abatement of the coronavirus pandemic, the 2022 budget includes special appropriations for participation and material costs related to events.
Both the realised office expenses for 2021 and those budgeted for 2022 mainly consist of the rent for the office premises on Porkkalankatu.
ICT costs include office equipment and the tools of our personnel, ICT maintenance and development, as well as software licences for, e.g. dealflow management and Board work.
Administrative and other expenses include recruitment, accounting, auditing and legal services as well as insurance, employee benefits, travel and training expenses, and the service and deposit fees charged by banks.
Key figures 2021
Equity ratio 2021
The Climate Fund’s financial income in 2021 was €51.2 million and its net income was €38.3 million. The company’s equity ratio is 91 percent.
- Climate Fund’s financial statement and Board of Directors’ Report 2021 (in Finnish)
- Climate Fund’s Sustainability Report 2021 (summary in English)
- Climate Fund’s financial statement and Board of Directors’ Report 2020 (in Finnish)
- State Development Company Vake’s financial statement and Board of Directors’ Report 2019 (in Finnish)
- State Development Company Vake’s financial statement and Board of Directors’ Report 2018 (in Finnish)
- Presentation from the 2022 Annual General Meeting (in Finnish)
- Presentation from the 2021 Annual General Meeting (in Finnish)
- Link remuneration 2019 (in Finnish)
- Link corporate social responsibility 2019 (in Finnish)