Q&A What private capital needs to deploy at scale

By Bruno Gardner | April 22,  2026
Head of Climate Change and Nature at Standard Life and board member at UKSIF

There is a clear opportunity to fund long-term infrastructure that meets public policy goals while delivering attractive, risk adjusted returns for institutional investors. To understand how this is playing out in practice, Simon Horner, Chief of Staff and Managing Director, Strategy at the Green Finance Institute spoke with Bruno Gardner, board member at UK Sustainable Investment and Finance Association (UKSIF) and Head of Climate Change and Nature at Standard Life (formerly known as Phoenix Group) with £295 billion in assets under administration. They discuss why Standard Life is investing in the transition, where investable opportunities remain constrained and how public finance institutions (PuFins) can better support institutional investors in mobilising capital at scale.

SH: The UK’s transition to a net zero economy will require unprecedented levels of investment. From Standard Life’s perspective as a long-term asset owner, why is private pension capital essential to financing this transition —and what makes pension funds particularly well suited to play this role?

Bruno Gardner:  Private pension capital constitutes a huge potential source of finance in the UK, given how much investment is needed over coming years (£40bn p.a. in the Clean Power mission alone).

They also represent long-term patient capital, which makes them very well suited to a lot of the infrastructure-type projects with stable and predictable cash flows that will form the backbone of the transition. The great thing is there’s a real appetite from pension funds like Standard Life to invest, as long as there’s the right balance between risk and return.

As signatories of the Mansion House Accord and members of Sterling 20, we have ambitions to scale up our direct investment in sustainable, transition and UK productive assets, set out in our latest Net Zero Transition plan, because we think this supports better long-term outcomes for our customers.

SH: Which parts of the transition, for example clean energy infrastructure, retrofit, nature restoration or adaptation, do you believe are currently most constrained by a lack of investable propositions rather than a lack of capital?

Bruno Gardner: Promising signs are emerging on the clean energy infrastructure front, as planning and grid reforms and the successful Contracts for Difference auction rounds bring a strong pipeline of projects in this area. Some support is still needed to make projects fully investible, in particular during the construction phase, with PuFins like the National Wealth Fund (NWF) having an important role to play in derisking projects for institutional investors.

One important asset class we’re still not seeing opportunities to invest at scale is nature-based solutions, which play a crucial role in both mitigating
and adapting to climate change. At the moment, business models and revenue streams are often still too uncertain and unproven for institutional investors. The same is true for newer clean energy technologies such as carbon capture, utilisation and storage (CCUS) and hydrogen production. So, these are areas where government support has a crucial role to play in catalysing investment.

SH: How important is policy clarity and long-term regulatory certainty in enabling pension funds to commit capital at scale to transition aligned investments? Where do you see the most urgent need for government action?

Bruno Gardner: Both are extremely important. Because we have long-dated liabilities and highly scrutinised fiduciary duties, we can only commit large multi-decade allocations when the transition pathway itself is predictable, investable and legally robust. Strong progress on this is due to the Clean Power Mission with the Net Zero Council and Transition Finance Council’s work to develop sector transition plans and investment roadmaps as a crucial next step.

SH: Public finance institutions are often described as critical ‘catalysts’ for private capital. In practice, what roles do institutions such as NWF or multilateral development banks need to play to crowd in pension fund investment?

Bruno Gardner: Institutions such as the NWF have an important role to play in derisking investments, which they can do using different types of instruments to crowd in institutional capital.

They also have an important broader role on helping to identify and shape investible projects by providing support to local and combined authorities, where many projects are originated. This could include providing guidance on how to structure deals, helping to matchmake projects with investors, but also wider collaboration with organisations such as GB Energy, the Office for Investment and of course the investor community.

SH: What financial structures or risk sharing mechanisms, for example guarantees, first loss capital or blended finance, have you found most effective in making transition investments viable for long-term institutional investors?

Bruno Gardner: Credit enhancement guarantees can be particularly effective to unlock institutional capital on projects not yet investment grade on their own merit. It was encouraging to see these referenced in the NWF’s latest five year strategic plan, but we’re keen for them to further consider how products can be better structured to be more efficient for UK annuity writers.

SH: Should the performance indicators of PuFins be adapted to prioritise originating new assets for private capital and subsequent mobilisation, over and above portfolio returns?

Bruno Gardner: PuFins typically have multiple objectives, for example the NWF has a triple bottom line of delivering the government’s growth and clean energy missions; generating a financial return for taxpayers; and catalysing private capital.

This is a really challenging set-up and the concern many investors have is that the goal to generate a financial return for taxpayers could result in a more conservative approach to deploying capital, which could reduce their ability to catalyse private finance in a truly additional way.

PuFins are ultimately there to enable government policy, and the positive impact on the UK economy from unlocking investment in support of government policy should significantly outweigh PuFins’ own financial returns. Therefore, we’d be in favour of greater weight being placed on delivering the government’s growth and clean energy missions.

SH: Looking ahead five to ten years, what would success look like in terms of collaboration between government, public finance institutions and private pension capital in delivering a just, investable and scalable transition?

Bruno Gardner: We want to see more collaboration between government, PuFins and pension funds and investment into the transition flowing at scale, enabled by targeted, highly catalytic PuFin support.

We want to see more collaboration between government, PuFins and pension funds and investment into the transition flowing at scale, enabled by targeted, highly catalytic PuFin support

We also want technologies that currently need NWF support to become investible in their own right, so that PuFins are able to continually refocus on unlocking investment in the next generation of technologies. And we’d love for Standard Life’s customers to feel good about the role their investments have played in driving the transition and growing the UK economy.

This article was originally published in the March edition of Green Finance Quarterly. Read the full publication here.