2030 Finance | May 19, 2017

Shareholder majorities for climate accounting, Morgan Stanley’s fund of funds, “big push” for…

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#Featured: ImpactAlpha Original

BlackRock tips shareholder vote to press oil giant to account for climate risk. All of a sudden, majorities of oil company shareholders are voting to force an accounting of climate risks and opportunities. Last week, shareholders voted to direct Occidental Petroleum to assess the impact of the “two-degree scenario” on the oil company’s assets. Other oil companies face surprisingly close votes later this month on resolutions to assess the financial effects of climate-change regulation (Exxon) and the status of their low-carbon transitions (Chevron).

The new majorities represent a titanic attitude shift among investors. In the Occidental vote, the world’s largest asset manager, BlackRock, for the first time bucked management to vote in favor of a climate-risk resolution. The rising shareholder concern reflects the speed with which concepts like “stranded assets” have gone from activist fringe to mainstream risk analysis.

Keep reading David Bank’s piece on the new shareholder majorities:

BlackRock tips shareholder vote to press oil giant on climate risk

#Dealflow: Follow the Money

Morgan Stanley has raised $125 million for an impact investing fund of funds. PMF Integro Fund I is one of the largest impact fund of funds to date and shows increasing client demand for sustainable investing products, according to Morgan Stanley’s Institute for Sustainable Investing, which helped develop the fund. Integro I will invest in socially- and environmentally-focused private equity funds with a focus on emerging and frontier markets and expects to earn commercial rate returns. The fund will provide detailed impact reporting alongside its financial statements. The investment is open to institutional and high net worth private clients. In March, Morgan Stanley’s Investing with Impact platform added two products for smaller investors, with minimum commitments of $10,000.

New Swell impact investing platform joins an increasingly crowded field. Life insurance firm Pacific Life has launched Swell, a social impact investing platform open to investors with as little as $500 to commit. The venture, Swell, is a similar concept to other impact-focused investing platforms targeting everyday investors that have launched and raised money recently (OpenInvest closed a seed round of funding earlier this week.) Swell is not a robo-advisor, however; its “rules based” investing is backed by a portfolio management team. Swell’s six portfolios are aligned with MSCI index’s environmental, social and governance criteria and the U.N.’s Sustainable Development Goals, among other metrics. It charges a flat 0.75 percent annual fee.

1776 launches a Brooklyn incubator for startups by women, for women. 1776 supports startups in government-dominated markets (think education, energy, health, transportation). With the Kate Spade Foundation, 1776’s new program will support startups led by women entrepreneurs that are solving challenges faced by women and girls. The 10 entrepreneurs in the Women’s Entrepreneurship Lab will get classes, special programs, and discounted office space at the Brooklyn Navy Yard in New York. Applications are open through July 31.

See all of ImpactAlpha’s recent #dealflow.

#Signals: Ahead of the Curve

A “big push” for agriculture technology for Central America. Pomona Capital is putting $250,000 into Organic Gum, which produces and sells a biodegradable and sugar-free gum sourced from the Petén region in Guatemala. The small investment is part of a big strategy: to build a startup ecosystem in one of Central America’s most important sectors: agriculture. “Building an entrepreneurial ecosystem is akin to the ‘big push theory’ in developmental economics,” Pomona’s Rich Ambrose told ImpactAlpha (read the full story). Agriculture accounts for nearly 30 percent of employment in the region, so boosting farm productivity and profitability can drive significant economic growth. Last September, Pomona launched the first AgTech accelerator in Central America — PomonaImpact AgTech. Pomona also is launching a $20 million fund, one of the first impact investing funds focused on Central America. Organic Gum, which sells the gum under the “WILD” brand in stores such as Whole Foods, is building out its manufacturing and distribution and plans to launch a private label.

Five things to know about the social (impact) scene in Asia. It’s foolish to characterize Asia with one sweeping statement. Yet across the region, there is a growing appetite for investment in social businesses. ImpactAlpha is a media sponsor of the Asian Venture Philanthropy Network’s gathering in Bangkok June 7–9. We caught up with Naina Batra, CEO of the AVPN, to talk about China’s super-rich, Korea’s success stories, the deal pipeline in Southeast Asia and the need for supportive regulations and increased collaboration. Read more.

#2030: Long-Termism

Imagine Boston in 2030. Since September 2015 more than 14,000 Beantown residents have identified challenges, set 2030 goals for the city and pitched in ideas for policies and investments to achieve them. The Imagine Boston 2030 plan imagines a more economically inclusive and climate resilient city. In nearly 400 pages, the plan lays out visions for “dense new neighborhoods in tucked-away corners of Boston, better transit connections between poorer pockets and jobs downtown, and a greener city, oriented around its waterfront, but also built to withstand whatever climate change may throw at it,” writes Tim Logan of the Boston Globe.

The 2030 vision of Boston sees growth, inclusion and climate resilience as inextricably linked. Boston’s population of 656,000 is likely to be only about 800,000 in 2030. But since Boston’s footprint isn’t growing, much of the plan, says Logan, is about finding room for another 150,000. The plan identifies six “expanded neighborhoods” with high-growth potential and calls for investments in education and industrial activity along the Fairmount corridor, a group of some of Boston’s poorest neighborhoods connected by a commuter rail line. The plan calls for the city to be carbon neutral by 2050 through emissions reductions in cars and trucks, buildings and power usage. Flood-management areas along the waterfronts as well as new open spaces could buffer against climate-related flooding.

Onward! Please send any news and comments to [email protected].