Professional services group Aon has launched a €260m climate transition fund in Ireland, strengthening the country’s role in mobilising capital for green business outcomes across global emerging markets. The fund was developed in partnership with Irish Life Investment Managers (ILIM), part of Keyridge Asset Management.

The Emerging Markets Climate Transition Fund is designed to give Irish investors an alternative to traditional passive emerging market equity exposure, while supporting the shift to a low-carbon economy.

The strategy focuses on companies contributing to climate action and broader UN Sustainable Development Goals, including resource efficiency, ecosystem protection and social resilience, while embedding ESG principles throughout the investment process.

ILIM collaborated with Aon on the fund’s design, combining proprietary quantitative modelling with enhanced sustainability data. The approach aims to deliver a flexible portfolio with low tracking error, tailored to the structural and regulatory complexities of emerging markets.

Environmental data sits at the core of the strategy, with a focus on reducing portfolio carbon emissions over time.

The fund aligns with global objectives to limit warming to 1.5°C and achieve net zero CO₂ emissions by 2050. Exclusions apply to companies involved in controversial weapons, tobacco production, thermal coal mining and those found in breach of the UN Global Compact.

With this launch, assets invested across Aon Ireland’s climate transition strategies have now exceeded €1bn.

“Responsible investing is no longer a niche – it’s mainstream, with the market growing strongly in recent years. That momentum is now being felt here in Ireland. Despite global volatility, investors want to make a positive impact on the planet and society while also achieving sustainable, long-term returns,” said Denis Lyons, head of investment at Aon Ireland.

Read more to see how this fund reshapes climate-focused investment strategy.