The former Bank of England governor Mark Carney has returned to his roots as an investment banker with a job spearheading environmental and social investing for a Toronto-based asset manager.
Carney will join Brookfield Asset Management, which ranks as the world’s second-largest investor in climate-friendly businesses behind the US firm Blackstone with about $550bn in assets under management.
Bruce Flatt, Brookfield’s chief executive, said Carney would join the firm as vice-chairman and steer its environmental, social and governance (ESG) investment strategy, with the task of marrying double-digit returns with positive social and environmental outcomes.
A Canadian who also holds Irish and British citizenships, Carney left the Bank of England in March just before the Covid-19 crisis hit the UK and the government forced the economy into lockdown.
City analysts expected him to be courted by the world’s largest investment firms after a lifetime building up one of the most extensive contacts books in the finance industry. Blackrock, which employs the former chancellor George Osborne, was known to be interested.
Carney, a former Goldman Sachs banker who was governor of Canada’s central bank for five years until 2013 when he took over at Threadneedle Street, was also the head of the G20’s financial stability board for eight years from 2011, which put him in touch with a wide range of finance ministers, central bank governors and sovereign wealth fund bosses.
He moved back to Ottawa, Canada’s capital city, fuelling speculation that he planned to go into politics.
In January Boris Johnson appointed Carney his finance adviser for the flagship COP26 climate change conference in Glasgow, but this was delayed by a year due to the Covid crisis. Carney is also a UN special envoy for climate and finance.
“Based on our fundraising capacity, the operating businesses and background that we have, and Mark’s relationships and strategic knowledge of this area, I think we can become a category killer in ESG investing,” Flatt said.
It is not known how much Carney will be paid at Brookfield, but while at the Bank, Carney was one of the world’s best-paid central bankers with remuneration of £882,885 including pension benefits and a housing allowance during the last financial year.
He said last year in an interview: “The question particularly for asset owners, pension funds, sovereign wealth funds and others is: How are you oriented? Are you on the right side, or the wrong side, of history?”
He added: “I didn’t want to just go back into the private sector, to straight commercial life. Having something where I could see the potential impact and the marrying of the commercial with the purpose was pretty important to me.”