Stopping climate change is the biggest investment opportunity of our lifetime, and its already driving radical change in how financial markets operate. Sign-up for the latest insights into sustainability, ESG and impact investing, and all the episodes of the Good Future podcast as they're released.
The $1.5B climate strategy decarbonising heavy industry
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Measuring the carbon emissions of your portfolio can be a useful tool to assess progress on decarbonisation and net zero targets, but relying on backward-looking data, and making only marginal improvements from one year to the next, is not going to drive the radical cuts in GHG emissions that we need to avoid the worst impacts of climate change. But also, it’s not going to attract institutional investment capital that wants a stake in the industrial disruptors of the future. These investors want an investment manager that looks forward, they want accurate forecasts of emissions avoidance potential, so they can feel comfortable they’re backing the businesses with the potential to create radical change! This was the thesis behind the development of Just Climate and its inaugural ‘industrial climate solutions strategy’, which targets growth-stage companies in hard-to-abate sectors. The strategy obviously hit the right note as the fund looked-through weakness in capital markets in 2023 to raise a cool $1.5 billion. Which was in no small part due to the impact modeling done by Clara Barby, Senior Partner at Just Climate, and my latest guest on the Good Future podcast. Clara has been highly influential in the evolution of the global impact investment movement over the past decade, having worked at both Acumen and Bridges, as well as leading the direction of the IMP norms, and the ISSB accounting standards. The team at Just Climate refer to their approach as ‘climate-led investing’. And as Clara explains the carbon accounting and emissions output models they use sit right alongside their financial models as potential value-drivers. Or course it's a forecast, but the team at Just Climate will stand by their hypothesis, and take on their role as equity managers to help steer the companies in their portfolios to deliver on both their climate and financial targets. This episode is rich with insights, which is no surprise given Clara’s impressive career, but it’s also delivered clearly and with heart. I hope it inspires optimism about the potential impact that investing through a climate lens can have on our economy and our planet.
I work with investors and their portfolio companies to build trust, drive inflows and create positive impact. |
The Business of Sustainability
Stopping climate change is the biggest investment opportunity of our lifetime, and its already driving radical change in how financial markets operate. Sign-up for the latest insights into sustainability, ESG and impact investing, and all the episodes of the Good Future podcast as they're released.
Impact investing is not an asset class, rather, it's an approach that can be applied to a diverse range of asset classes, and while this I’ve spoken about this concept at length in this newsletter, today I want to focus on fixed income. Fixed income is the world’s largest asset class. It has a set of unique characteristics that make it ideal for driving impact outcomes, but so far it hasn’t been utilised at anywhere near its full potential. Popular perception lags its intrinsic value There’s...
Australia has launched its very own Sustainable Finance Taxonomy, a long-awaited framework to classify what counts as ‘sustainable’. It follows global moves led by the EU, and aims to categorise a range of economic activities, highlighting ‘green’ leaders, as well as sectors making the ‘transition’. To help you understand what it’s all about I found the perfect guest to join me on the Good Future podcast, and that’s Linda Romanovska! In the episode she helps us understand why it’s important...
Amid all the noise, climate change persists Politics will sway like a pendulum, businesses rise and fall, but looking long-term the trajectory is clear, we're pushing our environmental systems ever-closer to collapse. Shifting your focus from the short-term to the long-term is never easy, but this is how investors position themselves ahead of the rest. To recognise the huge challenges on the horizon, and deploy capital to support those delivering solutions. Impact investing is a lens you can...