Jeff Ubben has said his new environmental- and social-focused firm Inclusive Capital Partners (In-Cap) wants to be a top-three investor at the mega-cap companies it targets.
In an interview with Activist Insight Monthly, Ubben declined to give a precise target for the amount In-Cap wants to raise and deploy, though the veteran activist noted that he is looking to “have the pool of capital that allows me to be a top-three investor in a company like BP,” adding that such a position would demand “a billion-and–a-half-dollar check.”
Given his top-three shareholder statement, that would indicate a portfolio value far larger than the $1 billion ESG-focused Spring Fund, which Ubben had been managing at ValueAct Capital Partners, and possibly closer to ValueAct’s overall assets under management of around $12 billion.
Ubben reportedly began building a BP stake in February via the Spring Fund, after the energy company publicly committed to eliminating carbon emissions. In June, it was announced that Ubben was leaving ValueAct, the firm he founded 20 years ago, to launch In-Cap.
Such financial clout provides the moral authority to make sure boards take risks, Ubben said. The activist has indicated that he intends to hold roughly a dozen stocks in his In-Cap portfolio, although many positions in the Spring Fund were small-caps.
Ubben explained that this strategy will allow In-Cap to invest in leading companies in economically essential sectors that have been overlooked by traditional ESG investors due to their poor environmental and social track record. Along with energy, he cited food production as an industry that “is going to be in much more trouble for all the right reasons.”
He argued that if an activist investor can convince incumbents in such sectors to commit to more environmental and socially beneficial practices they have “tremendous potential to win back shareholders.”
To read Activist Insight’s full interview with Ubben, subscribers can download the latest issue of Activist Insight Monthlyhere.