This article is featured in the 2024 FCLTGlobal Blue Book, a collection of real-world examples of how our members are putting long-term strategies into practice today. We hope that these practical illustrations will inspire others to embrace the mission of focusing capital on the long term. Learn more >>

Long-term focus and the advantages of mutual status 

Liberty Mutual Investments (LMI) manages ~$100 billion in assets for Liberty Mutual Insurance, a Fortune 100 property and casualty insurance company. Insurance is the bedrock of commerce. Our products allow individuals and businesses, large and small, to transfer and share risks that would otherwise inhibit economic progress. As the investment arm of Liberty Mutual, our objective is to safeguard and generate capital to support this broader social purpose over the long run. 

Being part of a mutual company provides us with distinct advantages in pursuing this mission with a long-term focus. Our structure fundamentally differentiates us from our competitors. Rather than distributing capital to shareholders, we grow, retain, and compound our capital in the interest of our policyholders, regulators, and broader stakeholders over time. Our mutual structure is fundamental to our commitment to investing with a long-term view, but equally critical is the differentiated culture and commitment to innovation that shapes our approach to investing.  

A differentiated culture 

Our culture is a sustained source of differentiation that drives our commitment to take a long-term perspective. LMI is guided by three cultural pillars: 

Long-term focus ≠ caution: A proven track-record in disruptive innovation 

LMI has been investing in venture capital on a large scale since the early 1980s, giving us a unique vantage point, access, and expertise. Through our partnerships and networks, we identify secular trends that have the potential for creating tectonic shifts in our economy. Beginning in 2010, we recognized and capitalized on the concept of “software eating the world” by strategically gaining exposure to software and software-enabling businesses across various sectors in our private investment portfolio. When we identify key trends, we invest across the entire value chain and capital structures of businesses that are driving the emergence of artificial intelligence, climate technology, and life sciences. These investments generate financial return and leverage our partnerships to deliver the full capabilities of Liberty Mutual Insurance to drive innovation and commerce.  

To replace flawed systems, society needs disruptive technologies and innovative business models. LMI’s dedicated investment teams in Energy Transition & Infrastructure (ET&I) and Impact Investing are helping meet this need for innovation in socially vital areas. These teams have the flexibility to invest across structures and sectors in projects and businesses that lack access to traditional sources of capital.  

In the area of ET&I, LMI has been actively supporting the global transition to a decarbonized economy for more than a decade. The ET&I team has a strong track record of generating attractive returns across many low-carbon technologies. As an example, our capital is supporting the development and construction of some of the world’s largest renewable energy and storage resources.  

To expand its impact, LMI broadened the ET&I mandate to include new sectors. In digital infrastructure, we are bridging the digital divide by providing growth capital to new fiber optic projects in rural and underserved communities. Our capital also supports the “circular economy” by capitalizing on projects that remove agricultural waste and transform it into a valuable energy resource. We are also actively investing in onshoring for the energy transition, providing financing to manufacturing facilities that support both job growth and the domestic renewable energy value chain. 

The recently launched Impact Investing strategy is positioning us at the forefront of a number of evolving social challenges and is pursuing investments that boost social mobility, expand access to essential services, and support resiliency, revitalization, and adaptation in distressed communities. We pursue these objectives by investing alongside partners who have a deep expertise in niche sectors and who are typically employing novel approaches to solving pressing social challenges.  

Sustaining our long-term commitment to capital as a force for good  

LMI occupies a unique position in the financial industry, leveraging its status as the investment arm of a mutual company and differentiated culture to prioritize long-term goals and investments in innovation and societal impact. LMI’s culture and dedication to disruptive innovation has not only yielded financial success but has also positioned the company at the forefront of major shifts in technology and industry trends. Across both Impact and ET&I investments, LMI seeks to maximize long-term investment returns by building partnerships with innovative firms who are investing in areas where capital is most constrained. This focus on innovation, sustainability, and impact enables LMI to create capital as a force for good and contribute to meaningful change.  

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