Greetings, Agents of Impact! Thank you to the hundreds of subscribers who participated in yesterday’s call on impact investing and political risk. Watch for the recap and replay in Friday’s Brief.
Featured: Climate Voices
Be just a little bit brave: Six ways big business can lead on climate action. Chief executives’ public affection for decarbonization and the Sustainable Development Goals far outstrip their ardor for the “actually doing something” phase of the affair, Clara Miller writes in a provocative post on ImpactAlpha. Miller, former head of Heron Foundation and founder of Nonprofit Finance Fund, offers an annotated to-do list for the heads of institutions who are seizing the moment (and the momentum of the SEC’s move to require climate disclosure by public companies) to exhibit leadership. Clara’s hit list:
- Stop making pledges. Start reporting performance.
- Stop lobbying against climate legislation and lobby for it (including regulation, carbon pricing and carbon taxes).
- Stop financing carbon-positive projects.
- Report on your ESG performance using standard disclosure metrics (yes, they exist).
- Run your business as if you were employing, buying from and selling to people you care about.
- Pay close attention to equity in your supply chain and across the globe.
And finally, “Explain to your boards and shareholders and friends in government why we must move quickly,” Miller writes. “You don’t have to be a Volodymyr Zelensky, but the stakes are at least as high for the world as they are for Ukraine. Be just a little bit brave.”
- Keep reading, “Be just a little bit brave: Six ways big business can lead on climate action,” by Clara Miller on ImpactAlpha.
On ESG disclosure, companies should listen to the opinion of the American public. JUST Capital surveys public opinion and then rates and ranks corporations on issues people care most about. “An expectation around transparency on these issues isn’t even remotely divisive to the public,” JUST’s Alison Omens writes. JUST’s recent survey found that 85% of Americans want companies to disclose more about their business practices and impact on society and even higher percentages want a standardized reporting structure for companies and federal requirements for corporate disclosure on human capital and environmental impact data.
- Climate data. More than half of the Russell 1000 companies JUST ranks disclose their direct greenhouse gas emissions, but only 10% of companies report so-called Scope 3 emissions data from the use of their products.
- Social factor. “Human capital disclosure is low across the board,” Omens says. But companies that disclosed the highest level of workforce diversity data saw 2.4% higher returns last year than those that did not.
- Keep reading, “On ESG disclosure, companies should listen to the opinion of the American public,” by Alison Omens on ImpactAlpha. ImpactAlpha’s Policy Corner is sponsored by the U.S. Impact Investing Alliance.
Dealflow: Gender Alpha
Insitor’s second Impact Asia Fund secures $42 million for early-stage investments. Singapore-based Insitor Partners launched in 2009 to bridge the gap in venture funding for early-stage companies in emerging economies in Asia, like Myanmar and Pakistan. The women-led investment firm invests in solutions for low-income people in education, agriculture, energy, water, healthcare and financial services. Insitor says its portfolio of 27 companies have created more than 14,000 jobs in Myanmar, Cambodia, India and Pakistan, and impacted more than 40 million low-income people. Insitor’s second Impact Asia Fund is looking to raise $70 million. Investors include an undisclosed family office, the Dutch Good Growth Fund and CDC Group, an anchor investor in Insitor’s $33 million first Impact Asia Fund.
- Dealflow. The second Insitor fund will invest in 12 to 15 companies at the pre-Series A to Series A stages and also co-invest with limited partners in larger deals. Investments include Trellis Housing Finance, which provides financing for low-income homebuyers in Pakistan; MedKart Pharmacy, a distributor of affordable medicine in India; and Taleem Finance, which provides financing to keep private schools affordable in Pakistan.
- 2X Challenge. Insitor, which has qualified as a 2X Flagship Fund, will invest with a gender lens (for context, see “With billions as bait, development financiers seek to hook private investors on gender-lens investing”). “Across Cambodia, India and Pakistan, women continue to be an under-utilized resource in unlocking higher rates of economic development,” said Insitor’s Nicholas Lazos.
H2 Mobility raises $122 million to build hydrogen fueling stations in Europe. Berlin-based H2 operates a network of 92 hydrogen fueling stations in Germany and sees rising demand, particularly from commercial heavy-duty vehicles. H2 Mobility says hydrogen-powered vehicles can refuel quickly and cover long distances while carrying heavy loads. “Green hydrogen will become a game changer on the journey to replace fossil fuels in transport,” said H2 Mobility’s Nikolas Iwan. Hy24, a joint venture between private equity investor Ardian and green hydrogen investor FiveT Hydrogen, led the round with a $77.6 million investment. FiveT last year raised $288.4 million to finance green hydrogen infrastructure projects in Europe. Other investors in the round include Hyundai, Shell and Daimler Truck. Share.
Dealflow overflow. Other investment news crossing our desks:
- Zoscales Partners is looking to raise $200 million for its second fund to invest in small and mid-sized enterprises in East Africa.
- GrowSari, which secured $45 million from KKR earlier this year, raises an additional $32.5 million to digitalize small retail stores in the Philippines.
- Waspito, an online social network for health in Cameroon, scores $2.7 million in seed funding to connect patients with doctors for video consultations using their smartphones.
- L.A.-based Leaf Agriculture raises $5 million in a seed financing round led by S2G Ventures to digitize and simplify farm data for agrifood companies.
Agents of Impact: Follow the Talent
Fidelity Foundations is hiring a program officer for economic opportunity in Boston… Elemental Excelerator seeks a head of development and other roles in Hawai’i or the San Francisco Bay Area… Elemental is also hosting “Elemental live: Nature-based carbon removal deep dive,” with Shopify’s Stacy Kauk, DroneSeed’s Grant Canary, Climate Robotics’ Jason Aramburu and Elemental’s Mitch Rubin, Thursday, Apr. 7… Overture is hosting another conversation in its series on climate tech and government with TPG’s Jim Coulter and Overture’s Shomik Dutta, Friday, Apr. 8.
Thank you for your impact.
– Mar. 30, 2022