Take a look at the Responsible Investment Ecosystem

Published in

Nossa Data

6 min readNov 25, 2019

Issue #9: Want to learn more about ESG? Subscribe to our weekly educational newsletter.

This week we began mapping the responsible investment ecosystem. With this map, we aim to make it easier for people getting started in the industry to understand where to find helpful resources.

Below is the first version of the RI ecosystem map. If you have any feedback on organizations / sections to add — please contact us and we will try to add it to a future version.

This map is following the Investment Association (IA) launch of ESG Definitions. Last Monday the IA set industry-wide definitions on responsible and ESG investing. These definitions are an attempt to create a common language for advisers, fund managers and consumers.

Take a look at some of their definitions:

Stewardship: Stewardship is the responsible allocation, management and oversight of capital to create long term value for clients and beneficiaries leading to sustainable benefits for the economy, the environment and society. Examples include: setting expectations, oversight of assets, engaging with issuers, voting.
ESG Integration: The systematic and explicit inclusion of material ESG factors into investment analysis and investment decisions. Examples include: statement of commitment, firm-wide policies.
Exclusions: Exclusions prohibit certain investments from a firm, fund or portfolio. Exclusions may be applied on a variety of issues, including to align with client expectations. They may be applied at the level of sector, business activity, products or revenue stream, company or jurisdictions/countries. Examples include: ethical, values-based or religious exclusions.
Sustainability Focus: Investment approaches that select and include investments on the basis of their fulfilling certain sustainability criteria and/or delivering on specific and measurable sustainability outcomes. Examples include: sustainability themed, positive tilt, best in class.
Impact Investing: Investments made with the intention to generate positive, measurable social and environmental impact alongside a financial return. Examples include: social bond funds, private impact investing.

Top stories this week:

EasyJet wants to offset their carbon emissions

EasyJet is set to become the world’s first major airline to operate net-zero carbon flights across its entire network. The budget airline said it would start offsetting all flights from Tuesday, November 19th. This initiative would cost the company £25m over the next financial year via schemes to plant trees or avoid the release of additional carbon dioxide. The company will also invest in R&D of new technologies such as electric & hybrid planes to decrease their emissions. Read EasyJet’s full statement on the initiative.

What Impact will the Energy Transition Have on Financial Markets?

Kingsmill Bond, a New Energy Strategist at Carbon Tracker, discusses how the new energy transition will impact financial markets as we know them today. Investment managers need to become aware of the speed of change of this transition by looking at two main trends:

The speed of cost drops in the alternative energy space.
The speed of growth of alternative energy technologies.

We are already seeing investment managers aiming to get ahead via investing in new energy solutions including French boutique Montpensier Finance or US-based Worm Capital.

Applying Effective Altruism to Climate Change

If you had $1 million dollars and your goal was to reduce as much CO2 in the atmosphere as possible by 2050, what would you spend it on? If your goal were solely to slow down climate change by reducing greenhouse gas emissions, you could do that more effectively by donating to organizations that are encouraging people to go vegetarian or vegan than by donating to leading carbon-offsetting organizations. This article summarizes the CO2 reduction potential of different technologies as well as the cost of implementing that technology.

S&P Global to acquire the ESG Ratings Business from RobecoSAM

S&P Global will acquire the ESG Ratings Business from RobecoSAM which includes the widely followed SAM Corporate Sustainability Assessment (CSA) — an annual evaluation of companies’ sustainability practices. The CSA is recognised as one of the most advanced ESG scoring methodologies, as it draws upon 20 years of experience analysing sustainability’s impact on a company’s long-term value creation. The acquisition will bolster S&P Global’s position as the premier resource for essential environmental, social, and governance (ESG) insights and product solutions for its customers. Read the full article.

Investors back global online market-place for ethical, green farmers

Globally, consumers and retailers are demanding more information about the goods they source, buy and eat. Retailers need increased confidence that their production and transportation does not damage the environment, or use illegal and unethical business practices. Seoul-based Tridge makes use of artificial intelligence, data and algorithms, and has about 80 employees in 40 countries verifying that suppliers are trustworthy and ethical.The data helps importers around the world understand the global market of ethically sourced food & agriculture. The company recently raised $10 million to expand its offerings.

Impact investing is about more than saving the world

New research by London Business School demonstrates that companies which decide to improve sustainability in an area that is material to their business, for example mining companies focusing on reducing environmental damage, delivered higher returns over time than peers who ignored it. This holds especially true for pension schemes. Not only are impact investments long-term in nature they should help increase members’ engagement and satisfaction with their pensions. Read the full article.

Fund Launches and News:

BMO Global Asset Management has unveiled the BMO Sustainable Multi-Asset Income fund, positioning itself in multi-asset and responsible investment for the first time. Irish Life Investment Managers is also launching a new environmentally sustainable, socially responsible fund. Meanwhile, Luxembourg’s government is working closely with the financial sector to position itself as the world’s leading sustainable financial center and younger workers are putting more demand on their employers to offer ethical pension products.

Business Highlight of the Week:

The Start-up Converting Organic & Plastic Waste into Petrochemicals

A Denmark-based startup works on a disruptive solution to convert plastic waste rescued from the oceans into eco-fuel.

BlueBenu is developing a clean technology to turn organic and plastic waste into crude oil and other virgin petrochemicals, with a zero-waste approach.

This eco-fuel does not require any modifications to engines or other established infrastructure to operate and can be combined with biofuels and traditional fossil-fuels — this flexibility enables its adoption in several industries.

The startup now targets the shipping sector, which carries approximately 90% of the world’s trade, but identifies future clients in the automotive, aviation and petrochemical industries.

BlueBenu’s business model is based on a circular approach, enabling the circular economy of plastics.

With its technology and approach, BlueBenu is working towards nine out of the seventeen UN Sustainable Goals.

Thanks to eutopia for providing us insights on the most exciting emerging green technologies.

You can also learn about:

How land can reverse climate change through soil carbon sequestration.
The impact of artisan craftsmanship in developing countries.
How verifying your company’s impact credentials can support capital raising.

Report Highlight of the Week:

The State of European Tech

Atomico released their research on the European Technology Market. While the report covers a wide range of topics across the European technology and venture capital ecosystem, one statistic to note is that 2019 saw a huge spike in investment into European tech companies which seek to solve some of humanity’s most pressing problems.

The report also looks at the extent of investment by SDG goal. The greatest amount of investment has been in Climate Action followed by Affordable and Clean Energy and Health and Well-Being. Clean Water and Sanitation has received the least amount of investment at $156M total investment.