TGIF, Agents of Impact!
🗣Social benefit premium. When the going gets tough, the tough get… back to business as usual? Larry Fink, after years of touting BlackRock’s sustainability chops, is backpedaling on ESG and this week named the head of Saudi oil giant Aramco to BlackRock’s board, as Amy Cortese reports. ExxonMobil’s dividend, capital spending and oil production, not to mention profits, are all up, two years after a tiny hedge fund won a proxy fight to put a slate of insurgent directors on the oil company’s board. “Shareholder activists’ biggest-ever victory was effectively a nothing-burger,” Imogen Rose-Smith writes in her latest Institutional Impact column. “The lack of moral courage from society’s most wealthy and powerful members… is fascinating—and depressing,” NYU’s Stern’s Alison Taylor wrote on LinkedIn. “I’m not calling the end of ESG. I am calling the end of the Fink era and its shallow, win-win rhetoric.”
That clears the field for Agents of Impact to deliver transformative solutions to climate change and inequality. Like other impact practitioners, proponents of food waste solutions recognize the value of patient, risk-taking and catalytic capital, as ReFED’s Alejandro Enamorado lays out for ImpactAlpha. Funders are practicing “participatory investing” to shift decision-making power, as well as capital, to communities closest to the solutions, with, as Amy reports, help from a new toolkit from Common Future and World Education Services. Investors, employers and policymakers are looking for ways to generate social returns through investments in historically Black colleges and universities, reports David Bank (RSVP for next week’s call). Impact managers are vying for the mandate to stand up a national “green bank”. Agents of Impact are monitoring metrics of good jobs that enable firms to outperform by creating value for employees, explain NYU Stern’s Ulrich Atz and Tensie Whelan. In other words, short impact-washing; go long on impact alpha. – Dennis Price
👋 Join us on LinkedIn Live: Unlocking social returns on investments in HBCUs. With their massive contribution to educational opportunity and economic mobility, historically Black colleges and universities may represent the ultimate social impact investment. To kick off ImpactAlpha’s partnership with Sherrell Dorsey, founder of The Plug, we’ll explore how investors, employers and policymakers are investing in HBCUs to generate social returns. Join Dorsey and David Bank, along with Carla Whitlock of Tuskegee University, Milken Institute’s Troy Duffie and other special guests, next Wednesday, July 26 at 10 am PT / 1pm ET / 6pm London. RSVP today.
The Week’s Podcast
🎧 Impact Briefing. David Bank chats with Acre Africa’s Niza Banda in the next conversation from this summer’s “Connecting capital to communities” gathering at the Salzburg Global Seminar, sponsored by the Robert Wood Johnson Foundation. Host Brian Walsh has the headlines.
- Listen to this week’s episode, and follow all of ImpactAlpha’s podcasts on Apple, Spotify or wherever you listen.
Acre Africa: Insuring farmers against crop failures and climate change. Africa’s food security depends on about 33 million farmers, most of whom till small plots of land without irrigation or sophisticated equipment. Food production, and the livelihoods that depend on it, are therefore increasingly vulnerable to drought, floods and other climate risks. Zambia-based Acre Africa brings together farmers and insurance providers to partially de-risk agricultural production, helping farmers who suffer bad seasons plant again. The approach spares households the devastating domino effects of being unable to repay early season loans for seeds and fertilizer, like losing their land, taking their children out of school or going hungry. “There’s a big push around how we get more people to subscribe to insurance products,” Banda says. Only about 3% of Africans have insurance or any kind; individual policies, particularly for low-income people in rural areas, have been too costly for large insurance companies to underwrite.
- Parametric payouts. Acre makes micro-insurance more accessible and affordable by developing products for groups of farmers, such as cooperatives or those enrolled in government agricultural initiatives, rather than for individuals. “The law of large numbers makes it affordable insurance for many people to access in one go,” Banda explains. The “parametric” coverage doesn’t require farmers to make individual claims; rather they get an automatic payout upon specific weather events, like inadequate rainfall over a crop cycle. Acre relies on crop phenology, weather data and remote satellite imaging to trigger payouts, saving time and money – though a widespread crop failure can require Acre’s insurance partners to pay out a large number of claims quickly.
- Learning curve. Acre couples insurance with technical assistance to help farmers mitigate human and on-farm risk factors. The company also serves as an intermediary to improve the flow of data and information between farmers and government agencies and facilitate financial services in rural communities. “The environment that we work in – insurance – is not is not at its most developed phase,” acknowledges Banda. “People are still learning.”
- Keep reading, “Acre Africa: Insuring farmers against crop failures and climate change,” on ImpactAlpha.
The Week’s Chart
Renewables go exponential, but is that fast enough? As much of the planet withers under historic heat, here’s some cool news: The energy transition is happening even faster than you might think. The continued momentum of falling prices, increasing capacity, aligned public policy, and adoption S-curves suggests exponential growth for the rest of the decade, according to RMI. “The faster it goes, the faster it gets,” write the think tank’s Kingsmill Bond and Sam Butler-Sloss. In the same way that Moore’s Law spurred innovation to keep chipmakers on track, the expectation of renewables’ exponential growth spurs progress. “A deep case for hope and agency is at the logical core of exponential change: more begets more,” the authors say. “Each cent shaved off of a watt of solar brings more deployment, which opens up the possibility to cut the next cent. And each solar panel installed on a roof increases the chances of a neighbor buying the next.” Share this.
The Week’s Dealflow
Deal spotlight: Investors pounce on green ammonia. The race is on to commercialize green ammonia, a gas made from a chemical reaction between nitrogen separated from air and hydrogen from water electrolysis (see, “Avaada’s big push to green India’s ammonia and hydrogen production“). Green ammonia can replace carbon-intensive “brown” ammonia for fertilizer and transport. This week, Israel-based Nitrofix, which has a one-step process to catalyze water and air to make ammonia, raised a $3.1 million seed round led by Clean Energy Ventures. Carlyle is looking to raise $2 billion for a sustainable energy fund that will invest in green ammonia production. The fund, which has secured $591 million in commitments, has made four investments in green ammonia, solar and storage projects.
- Clean tech. A partnership between Canada Pension Plan Investment Board and Dutch hydrogen developer Power2X will invest €130 million in green hydrogen, methanol and ammonia. Last week, Spring Lane Capital, through a new $290 million sustainable infrastructure fund, backed Argo Development Partners to develop biofuels, organic fertilizer and green ammonia. Earlier this month, Mumbai-based Avaada Group scored $1.3 billion to ramp up production for green ammonia, methanol and hydrogen.
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Carbon markets. Isometric secured $25 million to register and verify carbon-removal offsets… Sylvera, a UK-based carbon credit ratings company, raised $57 million in Series B financing.
Fund news. Bridges Fund Management is reportedly in the market with its sixth real estate-focused impact fund… Aristata Capital raised $67.2 million for its impact litigation fund… The slow fundraising environment is hitting EQT Future, Swedish global investor EQT’s impact buyout fund… VIA Fund made four impact investments in Armenian entrepreneurs.
Impact tech. Gurgaon-based Regrip secured early funding to make low-cost refurbished tires for India’s small utility vehicles… World Bank supported fintech startups from oft-overlooked markets in Southern Africa.
Investing in health. Herself Health, a Minnesota-based healthcare company for women over 65, raised $26 million… Berry Health in Ghana scored $1.6 million to provide telehealth services to mental and sexual health patients… Quadria Capital backed Maxivision Eye Hospital to expand eye care services in India’s second- and third-tier cities.
Low-carbon transition. Copenhagen Infrastructure Partners raised $6 billion toward a targeted $13 billion renewable energy fund… Blume Equity backed a €25 million round for Sensorfact, a Dutch remote sensing and software company that helps small manufacturers reduce energy usage… Wells Fargo’s Innovation Incubator supported 12 startups developing climate-focused agrifood tech… The Dutch operations of e-bike maker VanMoof was declared bankrupt by a Dutch court.
Returns on inclusion. Atlanta-based Illoominus raised $500,000 for human resources software that helps companies evaluate and improve diversity and inclusion… ICA Fund invested in co-working and childcare space Pillar, Black-owned bakery Rize Up, and three other local businesses via impact notes.
Sustainable supply chains. Private equity giants rallied behind O9 Solutions’ sustainable supply chain software… Coca-Cola is partnering with venture capital firm Graycroft on a nearly $140 million sustainability fund to reduce the beverage giant’s packaging, storage and supply chain carbon footprint.
The Week’s Talent
Fidelity’s Emilie Goodall, CalSTRS’s Kirsty Jenkinson, and Kieron Boyle of Impact Investing Institute are among the members of TIIP’s working group to set standards for measuring system-level investing influence. Renaissouk’s Lenora Suki chairs the group… Skoll Foundation’s Debbie Santos joined Rhia Ventures’ board of directors… Karen Kelleher, ex- of LISC Boston, was named president of the BlueHub Loan Fund.
DeAngela Burns-Wallace, a former member of Kansas Gov. Laura Kelly’s cabinet, will become CEO and president of the Ewing Marion Kauffman Foundation. Interim CEO Susan Chambers will return to the foundation’s board… Freelance journalists Megan Greenwell, Robin Kaiser-Schatzlein and Hamilton Nolan were named “reporters in residence” at Omidyar Network.
The US Environmental Protection Agency named Theresa Segovia, ex- of the Department of Justice, as principal deputy assistant administrator of the environmental justice and external civil rights office. Karim David Marshall, a former candidate for Washington, DC’s city council, joined the same office as a senior adviser.
The Week’s Jobs
💼 Share the week’s impact jobs. Want to post a job in The Brief? Drop us a note.
In the US
Grounded Capital seeks an investment associate in San Francisco… Also in San Francisco, RE-volv is looking for a finance director… Arctaris Impact Partners is hiring a director of investor relations in Wellesley, Mass.
In Europe
E3G is recruiting a senior policy advisor to lead the team’s work on German climate foreign policy, and a senior policy advisor for its clean economy team in London… Also in London, Apollo seeks an ESG legal counsel… IDH is hiring a senior program manager of carbon and landscapes finance in the Netherlands.
Other global locations
Climate+ is hiring a legal executive in Singapore… Alterna Impact is recruiting an impact business development fellow in Guatemala City… Accion has an opening for an accounting assistant in Bogota… Oikocredit is on the hunt for an interim investment officer in Côte d’Ivoire… Acumen is looking for a senior investment associate in Nairobi.
Remote positions
Justice Funders is hiring a senior director of transition investing… Purpose Foundation seeks a research lead… ImpactAssets seeks a director of investments and a senior analyst for impact.
That’s a wrap. Have a wonderful weekend.
– July 21, 2023
