TGIF, Agents of Impact!
🗣 Sunlight. In the weeks leading up to Russia’s invasion of Ukraine, U.S. President Biden made the decision to declassify U.S. intelligence that disclosed Russian President Vladimir Putin’s plans. The new approach is credited with exposing Russia’s prevarications and denying its military the element of surprise. That it didn’t prevent an invasion bears out the “necessary but not sufficient” view of disclosure. The same is true in ESG and impact investing, where rules on corporate measurement and disclosure, from climate impacts to human capital management, are being hammered out at the Securities and Exchange Commission, the European Union, the International Sustainability Standards Board and elsewhere (see The Call, below).
Among the faithful, the “not sufficient” critique can sometimes drown out the “necessary” part, obscuring the hard-won progress in getting comparable data across companies on metrics like carbon emissions, workforce investments and board diversity. Only after that can verification, auditability and accountability come, followed by benchmarks and correlations and, eventually, consequences and change. Disclosure is no substitute for principled behavior, and sunlight no antidote to outright aggression. Popular mobilization and collective pressure are indispensable. First, we have to know what’s going on. – David Bank
🎧 Impact Briefing. Host Brian Walsh convenes the roundtable regulars, Imogen Rose-Smith and David Bank, to talk invasion, materiality… and pregnant pigs. Plus, the headlines.
- Listen to this week’s episode, and follow all of ImpactAlpha’s podcasts on Apple, Spotify or wherever you listen.
👋 Next Call: Operationalizing impact and ESG inside the enterprise. On one of last year’s most popular Calls, Cathy Clark of Duke’s Fuqua School of Business provided a how-to on “optimizing for impact.” The sequel: How to operationalize ESG and impact inside the enterprise. On the next Agents of Impact Call, Clark will step through the process with Brendan Morrissey of Walmart, which is undertaking Project Gigaton to reduce greenhouse gas emissions from the retail giant’s supply chain by one gigaton by 2030.
- Join The Call, Tuesday, Mar. 8, at 10am PT / 1pm ET / 6pm London. RSVP today.
The Week’s Call
Call No. 38: Inside the generational opportunity to reshape rules of corporate disclosure. Bottom-up policies for access to capital in divested communities. Top-down strategies to reshape capitalism to work for all stakeholders. “We think that the connective tissue between those two represent particularly fertile opportunities for our field,” said Fran Seegull of the U.S. Impact Investing Alliance on ImpactAlpha’s Agents of Impact Call this week. New disclosure rules from the Securities and Exchange Commission will help define the next stage of capitalism.
- Generational opportunity. The SEC is grappling with externalities and how to price them in a way that allows investors to hold management accountable, said former SEC advisor Satyam Khanna. Between climate and human capital, “this is probably one of the most important sets of disclosure rule-making in a generation at the SEC.” Sign up to get updates from the Alliance.
- Efficient allocation. Human capital is an asset, not a cost, said Cambria Allen Ratzlaff of the Human Capital Management Coalition, a group of 35 institutional investors representing more than $6.6 trillion in assets. The group is seeking requirements for companies to disclose high-quality information. “It’s really important that we’re able to understand, evaluate and then make decisions with respect to how we allocate our capital and vote proxies,” said Ratzlaff, who is also corporate governance director at the $61 billion UAW Retiree Medical Benefits Trust.
- Step by step. Seegull agreed that disclosure and transparency are “necessary but insufficient.” Still, “we have to balance our ambition and our goals and dreams with the regulatory windows that are open now,” she said. “Practicality, and commenting and supporting the SEC, if they’re subject to litigation, are the most important things in the short and medium-term.” The Alliance is coordinating letter-writing and comments around the new rules.
- Read the recap and (re)watch the replay.
The Week’s Dealflow
Deal spotlight: ESG data. Global ESG assets are on pace to exceed $53 trillion by 2025, a stunning sum that would represent more than one-third of worldwide assets under management. Growing investor demand for transparency is driving the rollout of environmental, social and governance data platforms to streamline ESG measurement, data collection and benchmarking for companies and investors, as regulations kick in. This week, Actual raised $5 million to simulate the impact of ESG strategies.
- Impact measurement and management. Last month, SJF Ventures shared its map of a dozen providers of technology to collect and analyze the impact of its portfolio companies. 60 Decibels raised $8.8 million to measure stakeholder impact. In December, Proof of Impact raised $2.3 million to enable the real-time collection, verification and analysis of impact and ESG data. In November, Novata raised $21 million to track ESG in private markets.
Low-carbon transition. Antora Energy raises $50 million for zero-carbon batteries for heavy industry… Microsoft’s climate fund backs Leko Labs’ low-carbon wood for construction… Nori raises $7 million for its blockchain-based carbon marketplace… Slate Asset Management launches an infrastructure impact investment fund focused on the energy and low-carbon transition… The U.S. Department of Energy will invest $150 million in research projects reducing carbon emissions from energy technologies and manufacturing… TPG Rise rolls up Element Markets and Bluesource to go big on carbon credits.
Electric vehicles. BlackRock leads Revel’s $126 million funding round to expand EV charging in major U.S. cities… EQT Infrastructure acquires InstaVolt, a U.K.-based operator of electric-vehicle charging stations, to grow its network of EV chargers… Zoomo raises $20 million to make light electric vehicles, including e-bikes and e-mopeds, for delivery workers and large fleet operators.
Circular economy. Mumbai-based battery recycling tech startup Ace Green Recycling raises $7 million in a funding round led by Circulate Capital… New York-based B Corp. Blueland secures $20 million to make cleaning products using eco-friendly and reusable plastic bottles and containers.
Clean energy. Germany’s Hy2gen raises €200 million to build facilities for producing green hydrogen fuel for sea and ground transportation, aviation and industrial applications… Husk Power Systems scores $4.2 million to scale minigrids in India and Africa.
Economic inclusion. Agri-Business Capital Fund secures $5 million from Bank of America to invest in businesses supporting smallholder farmers in emerging markets… MarketForce raises $40 million to digitize Africa’s small retailers.
Investing in health. An €80 million European impact fund will invest up to €3 million, mainly in companies in France, improving access to health and wellbeing… Revent secures $68 million to invest in early-stage European companies in health and wellbeing, economic empowerment, sustainability and the future of food.
New funds. Capria Ventures and Cometa, a Mexico-based venture firm looking to raise a $100 million fund, join forces to invest in startups approaching unicorn status… Burnt Island Ventures raises $30 million for a fund that will invest in early-stage startups in wastewater and stormwater management.
The Week’s Talent
CDC Group, the U.K.’s development finance institution originally known as the Colonial Development Corp., rebrands as British International Investment, and appoints four new managing directors: Amal-Lee Amin as head of climate; Chris Chijiutomi as head of infrastructure equity in Africa and Pakistan; Yasemin Saltuk Lamy as head of asset allocation and capital solutions; and Abhinav Sinha as head of technology and telecoms… David Gelles joins the climate desk at The New York Times… Dustin Shay, ex- of Village Capital, joins Sorenson Impact Center to lead the center’s new Impact Labs group.
Aeris announces the retirement of founding board member Andrew Cooney of 1112 Capital and appoints Sunwealth Power’s Omar Blayton, and Sonja Velez of San Francisco Foundation to its board… La June Montgomery Tabron of the W.K. Kellogg Foundation joins TIAA’s board of trustees… Christian Schmid, ex- of Queensland Investment Corporation, will lead a new impact infrastructure strategy at Slate Asset Management… Mission Driven Finance promotes Zach Lickteig (portfolio operations associate), Andrew Moncada (investment associate), Laura Olivas (senior manager) and Crystal Sevilla (manager).
The Week’s Jobs
Aeris is recruiting a senior associate, an associate, a CDFI data analyst, and a financial institutions rating analyst… ImpactAlpha is hiring a director of subscription growth… JPMorgan Chase is hiring a sustainable growth associate in San Francisco and looking for a program manager for Force for Good Americas in Jersey City, N.J… Builders Vision is looking for a vice president of ESG in public markets… Value for Women seeks a gender and business expert in South Asia.
The Michael and Susan Dell Foundation is recruiting a program director of market-based solutions and a U.S. program officer in Austin… Omidyar Network is looking for associates in Redwood City, Calif. or Washington, D.C… Adasina Social Capital has openings for an investment strategist and an investment operations analyst… Sunwealth is looking for a senior project finance associate in Cambridge, Mass… The Bill and Melinda Gates Foundation is hiring a senior advisor for the private sector in Delhi.
The Bridgespan Group seeks an impact investing manager… Impact Investment Exchange seeks an associate in Hanoi, Vietnam… Dalio Family Office seeks an associate director of operations for Dalio Education in Greenwich, Conn… Global Partnerships is hiring a credit operations officer in Seattle… The Just Economy Institute is accepting applications for its next cohort of JEI fellows.
Blue Earth Capital is recruiting a head of funds and co-investments in London… WaterEquity seeks a director of climate impact… Mission Driven Finance is hiring a real estate director and other roles… Personetics seeks an ESG research analyst in Tel Aviv… Developing World Markets is recruiting a senior regional representative on its private debt team in Nairobi.
That’s a wrap. Have a wonderful weekend.
– Feb 25, 2022