Our story begins with an idea that came to us during a conference in 2015 organised by BNP Paribas to analyse CSR trends in Finance. Sébastien Nunes, who was in charge of the Pension Funds Client Segment at BNP Paribas Securities Services at the time, realized that asset owners were becoming more interested in being CSR compliant throughout the value chain (corporates, asset managers and asset servicers), including themselves. Therefore, they would see an increasing interest in the financing of carbon offset projects to align their strategy with COP21 guidelines.
What happened in the subsequent years proved him right. Anticipating future regulations, many big companies — and small ones — now try to offset their carbon footprint by investing in projects implementing technology that allows the avoidance of carbon emissions. In other words, the principle of voluntary carbon offsetting is that one ton of CO2 emitted somewhere can be compensated thanks to a carbon offset elsewhere. The foundation for this type of trade is called carbon credits.
Yet, this market is still in need for structuration. Prices are not reflecting the value created and are spread out because of the lack of transparency of certain market practices.
This financing capacity is therefore hampered by a minimum degree of disclosure, security and efficiency on the voluntary carbon market in a way that 50% of projects fail due to funding struggle. Working in a financial institution such as BNP Paribas Securities Services (BP2S) -the biggest multi-asset servicing specialist in Europe, 5th worldwide, helping its clients achieve their ambitions both in terms of investments and cross-border distribution — provided Sébastien with the understanding of the opportunity ahead. The structure of the voluntary carbon market could be leveraged with the know-how of BP2S.
Passionate about sustainability related issues, Sébastien started talking about his idea to his direct management. There could not be a better timing to do so as BNPP’s CSR strategy gained more and more momentum, the best example being that the bank became carbon neutral in 2017. The initiative went on project mode in July 2017 with the objective to launch a new company within a year.
Sébastien’s team and BNPP top management agreed that the company should be the first social business of BNPP following the principles of Nobel Peace Prize Prof. Yunus. They therefore worked closely with the Grameen Creative Lab — the consulting arm of Prof. Yunus — to obtain the precious label.
After one year of work to achieve all this, ClimateSeed, the first social business of BNPP Group, was born to connect entities seeking carbon neutrality and UN SDGs impacts, with project developers looking for funding for their carbon offset projects.
Sébastien Nunes, ClimateSeed CEO, explains his vision: « Carbon credits must be the vector to spur larger environmental and social impacts. At ClimateSeed we believe that carbon offsetting must always come along a reduction strategy, carbon offsetting should never be done for greenwashing purposes. We will always encourage decarbonization before the offsetting of irreducible carbon emissions! The voluntary carbon market must urgently play a decisive role in the fight against the effects of climate change as our production model is not adapting itself quickly enough, this is our mission».