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Sacred Sites Strategize for Impact Investments

 Ramanathaswamy Temple, Rameswaram, Tamil Nadu, India. December 1999 (Photo by Ryan) Creative Commons license via Flickr.

Ramanathaswamy Temple, Rameswaram, Tamil Nadu, India. December 1999 (Photo by Ryan) Creative Commons license via Flickr.

By Sunny Lewis

LONDON, UK, August 1, 2017 (Maximpact.com News) – Representatives of sacred places and cities that attract spiritual pilgrims are working with highly placed conservationists to create a dedicated fund for their environmental protection by relying on the investment community’s growing commitment to ethical or impact investment.

The altar at the Naga Metropolitan Cathedral, September 2009. (Photo by Jay-Ar Cruz) Creative Commons license via Flickr.

The altar at the Naga Metropolitan Cathedral, September 2009. (Photo by Jay-Ar Cruz) Creative Commons license via Flickr.

In London last week, proposals totaling nearly a billion dollars were discussed in a meeting organized by the Alliance of Religions and Conservation (ARC), which was founded in 1995 by HRH Prince Philip.

ARC is a secular body that helps the major religions of the world to develop their own environmental programs, based on their own core teachings, beliefs and practices.

ARC now works with 11 major faiths, helping the religions link with key environmental organizations, creating powerful alliances between faith communities and conservation groups.

The event at The Wesley, the UK Methodists’ first eco-hotel in London, was co-hosted by R20, a not-for-profit, public-private partnership that envisions mobilizing the regions of the world to be leaders for green growth.

Founded in 2010 by former California Governor Arnold Schwarzenegger and other subnational leaders in cooperation with the United Nations, R20’s mission is to support local governments in the creation and successful financing of renewable energy and sustainable infrastructure projects.

The projects chosen are ones that produce measurable environmental, social and economic benefits, as well as attractive financial returns for investors.

According to the R20 Executive Director Christophe Nuttall, “The investment community, which has already made great strides in ethical investment, is starting to realize that religions are producing structured investable projects in this area.”

The aim of the London meeting was to set up a structure for faiths to access impact investments.

Pioneering impact investor BlueOrchard, and R20, together with ARC, are proposing to build just such a dedicated fund for sacred places and pilgrim cities.

Based in Switzerland, BlueOrchard was founded in 2001 by the United Nations as the world’s first commercial manager of microfinance debt investments worldwide. BlueOrchard now has a total of seven offices on four continents.

To date, BlueOrchard has invested US$4 billion in 350 institutions across 70 countries, providing access to financial and related services to over 30 million low-income individuals.

On July 25, the BlueOrchard Microfinance Fund exceeded the US$1 billion investment mark for the first time since its inception in 1998.

“Having proven for almost two decades how social impact, outstanding financial returns and environmental developments go hand in hand, BlueOrchard has become the industry’s thought and innovation leader,” says Peter  Fanconi, who chairs BlueOrchard’s Board of Directors.

Inside a mosque in Fez, Morocco, January 2011. (Photo by Anna & Michal) Creative Commons license via Flickr.

Inside a mosque in Fez, Morocco, January 2011. (Photo by Anna & Michal) Creative Commons license via Flickr.

Ten pilgrim cities and sacred places were represented at the London meeting:

Naga, Cebu, Philippines: Catholic. The province of Cebu and Naga City are proposing to replace thousands of polluting tricycle vehicles with electric vehicles as the major form of transport to key pilgrimage sites such as the Naga Metropolitan Cathedral.

Djerba Island, Tunisia: Muslim and Jewish business owners plan on developing infrastructure to accomodate pilgrim and tourist visits to sites such as the Ghriba Synagogue, the oldest synagogue in Africa.

Etchmiadzin, Armenia: Orthodox Christian. Planning is underway for a model green pilgrimage city focusing on education, water and energy. Pilgrims come to see the oldest cathedral in the world, Etchmiadzin Cathedral, built in the early fourth century.

Fez, Morocco: Muslim. At more than 1,000 years old, Fez is considered the spiritual heartland of Morocco. The city is planning biogas collection for public lighting.

Fujaira, United Arab Emirates: Muslim. planning new pilgrimage and tourist facilities based on traditional Islamic architecture. Among other sacred sites, pilgrims come to visit the 500 year old Al Bidya Mosque, called the oldest, smallest and most beautiful mosque in UAE.

Jiangsu Province, China: Taoist. Chinese authorities want to replace old energy systems in 200 temples with high tech sustainable technologies that will be a model for other, secular development in China.

Kalakad Mundanthurai Tiger Reserve, India: Hindu. Two state governments are proposing sustainable financially viable ways to cope with the millions of pilgrims passing through to visit the tiger reserve, which forms the catchment area for 14 rivers and streams, including the Ganges. A core area of this reserve has been proposed as a national park.

Kano, Nigeria: Muslim. The largest Sufi pilgrimage site in Northern Africa, Kano hosts up to three million people at key times. The government is planning infrastructure and drinking water distribution programs.

Rameshwaram, India: Hindu. Separated from mainland India by the Pamban Channel, this town is the center of attraction for Hindu devotees across the world. Two of main attractions are the great Ramanathaswamy Temple, built in the 17th century, and the nearby Five Faced Hanuman temple. Businesses plan to overhaul transport, water and waste facilities for pilgrim visits to the island’s temples.

Zanzibar City, Tanzania: Muslim and Christian. The city is planning an eco-hotel and environmental education centre on abandoned land beside the UNESCO Heritage Site of Stone Town. Pilgrims come to visit the 500 year old Malindi Mosque, Zanzibar’s oldest, dated to the 15th century.

There were also three complementary business initiatives represented at the London meeting:

Amaravati Buddhist Centre, London, UK: Buddhist. This center is planning an eco-village for the 21st century on its wooded site in London.

Wesley Methodist Hotel Group, London, UK: Methodist Christian. This company is expanding its chain of award-winning eco-hotels to include the first-ever Methodist National Park, in Kenya.

Dartington, UK: Multi-faith. A 14th century historic house and substantial grounds and property are the central point for 40 organisations, including businesses, working on technological solutions to energy needs, agriculture, waste and water.

All 13 groups have produced business plans to attract investment for sustainable infrastructure enterprises.

A dedicated fund is needed, meeting participants agreed. In the short term this could help finance some or all of the attending projects. In the medium term this could finance up to 200 sustainable projects in different cities and places.

By 2030 this could grow to include 7,000 cities, some of which will be considered sacred, but others which will benefit from having local faith groups consult in investment plans, meeting organizers said.

While there is an increased interest in ethical, or impact investment from investors, meeting participants recognized that there is a real shortage of sustainable projects for sustainable funds to invest in around the world.

R20 and BlueOrchard have developed a unique value chain which, on the one hand, identifies and structures a portfolio of low-carbon and climate-resilient infrastructure projects up to bankability, and on the other hand, helps invest in these projects due to a de-risking blended finance mechanism with philanthropic, subsidies, equity and loans from both public and private banks.

R20, BlueOrchard, ARC and representatives of many of these projects will be taking part in the Faith in Finance meeting on October 29 in Zug, Switzerland. Find out more at: ArcWorld Projects


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Featured Image: The Laozi-Jinshan Temple, with a gigantic statue of Laozi the legendary founder of Taoism (Photo courtesy Mao-shen, Sacred Taoist Mountain of Eastern China) Posted for media use

Corporate Conscience Distinguishes Trailblazer CEOs

Travelers EDGE, which stands for Empowering Dreams for Graduation and Employment, has provided direct financial assistance to support hundreds of college and university students. (Photo by John Walker)

Travelers EDGE, which stands for Empowering Dreams for Graduation and Employment, has provided direct financial assistance to support hundreds of college and university students. (Photo by John Walker)

By Sunny Lewis

NEW YORK, New York, July 5, 2017 (Maximpact.com News) – Chief executive officers of hundreds of the world’s largest companies are finding that improving society is the path to energizing and reaching vital stakeholders as well as building more resilient markets.

When surveyed about the role of purpose at their companies, 64 percent of this group of CEOs agree that “purpose is a powerful motivator.”

The companies that have tapped into purpose as inspiration for their workforces are seeing the rewards, according to the survey by the business association CECP, The CEO Force for Good – 58 percent of companies with a clearly articulated and widely understood purpose see financial growth of more than 10 percent, and 85 percent of purpose-led companies increased revenue between 2013 and 2016.

Green Bronx Machine is a grantee of CECP member Newman's Own Foundation. Originally an after-school, alternative program for high school students, Green Bronx Machine has evolved into K-12+ model integrated into core curriculum. Students grow, eat and love their vegetables en route to spectacular academic performance.

Green Bronx Machine is a grantee of CECP member Newman’s Own Foundation. Originally an after-school, alternative program for high school students, Green Bronx Machine has evolved into K-12+ model integrated into core curriculum. Students grow, eat and love their vegetables en route to spectacular academic performance.

CEDP was founded in 1999 by the late actor and philanthropist Paul Newman (1926-2008) and other business leaders to create a better world through business.

Newman said at the time, “I helped to start CECP with the belief that corporations could be a force for good in society.”

Doing good and doing well proceed in tandem for these companies. Taken together, the more than 200 corporations represent $6.2 trillion in revenues, $18.4 billion in societal investment, 13 million employees, and have $15 trillion in assets under management.

CECP affiliation is by invitation only and is limited to multibillion dollar for-profit companies with a handful of smaller companies that embody the CECP mission.

Now, CECP has delved into its research base to develop insights designed to help guide other companies as they shape their own social strategies.

A new digest of data and insights, “Investing in Society,” is focused on best and most innovative practices drawn from CECP’s coalition.

It examines what actions companies are taking to identify and effectively meet stakeholder needs, and how a unified approach across all business units supports this effort.

Developed from CECP’s original research; findings from the 2017 Giving in Numbers Survey conducted in association with The Conference Board; and drawn from hundreds of monthly discussions with CECP CEOs, and conversations with experts and on-the-ground practitioners.

“CECP’s view is that the world’s leading corporations have emerged as a steadying presence and remain uniquely qualified to continue to drive progress, in spite of unpredictable global circumstances,” said Daryl Brewster, CEO, CECP.

“Investing in society serves as both inspirational and practical as companies seek to strengthen their societal investments and impacts,” Brewster said.

Brewster is far from alone in this belief. According to the 2017 Edelman Trust Barometer,  75 percent of the general population believe that companies can take actions to improve economic and social conditions in their communities, so now, more than ever, business will be expected to stand firm in their commitments.

This 75 percent result comes although the 2017 Edelman Trust Barometer also shows the largest-ever drop in trust across the institutions of government, business, media and NGOs.

CEO credibility dropped 12 points globally to an all-time low of 37 percent, plummeting in every country studied, while government leaders remain least credible.

Of the four institutions – government, business, media and NGOs – business is viewed as the only one that can make a difference. Three out of four respondents to the Edelman Trust Barometer survey agree a company can take actions to both increase profits and improve economic and social conditions in the community where it operates.

Among those who are uncertain about whether the system is working for them, it is business (58 percent) that they trust most.

Appreciation for steadiness appears to be spreading from Main Street to Wall Street. Top CEOs are relying on a long-term approach to set the context for short-term actions by prioritizing company health and value creation for all stakeholders, not just shareholders demanding strong quarterly returns, says CECP in its guidance for CEOs.

To help accelerate this movement, on September 19, CECP will host the second CEO Investor Forum, featuring CEOs presenting their companies’ long-term strategic plans, including operational and financial outlooks ranging three to five years or more.

They will address an audience of 200 long-term oriented institutional investors and pension funds, collectively representing $25 trillion in assets under management.

Cultivating volunteers for good causes among their employees, the most successful companies are allowing flexible schedules so their employees can volunteer based on their business’ skills and passions.

“Our dedication to being a strong corporate citizen and improving the communities where we live and work touches every part of our organization,” said Marlene Ibsen of CECP member Travelers Indemnity Company, vice president of community relations at Travelers and CEO and President of the Travelers Foundation. “We’re working to help our communities succeed, from company-sponsored programs like Travelers EDGE® to our passionate employees who logged nearly 118,000 hours of volunteer time in 2016.”

Finally, in a global take away message, the CECP report shows that despite global unrest no company can operate in isolation. CECP says, “All borders are blurred given supply chains and stakeholders. And all companies and countries need to work together to solve the global challenges at hand.”

In 2016, CECP’s Global Exchange continued to work with like-minded organizations in Europe, South America, Asia, and Africa to connect companies with collaborative opportunities to increase their global impact in solving the world’s most pressing problems, based on each region’s unique needs and cultures.

CECP found six approaches among corporations that give to social causes:

  • Direct Investments: The corporation acquires or merges with a social enterprise
  • Self-managed Funds: An entity is created inside the corporation that invests in business and social enterprise
  • Third-party Funds: Corporate funds are transferred to a fund which then deploys money to social enterprises
  • Strategic Alliances: Partnerships among companies create innovative market-based social benefits
  • Incubators & Accelerators: Companies deploy financial and non-financial assets to spur growth of small social enterprises
  • Corporate Foundations: Foundation funds are deployed to social enterprise, expected to be paid back

Data from the 2017 Giving in Numbers Survey show that, despite an uncertain sociopolitical environment, companies remain committed to increasing societal investments – median total giving increased in 2016.

But getting up in front of an audience is not the most effective practice for sustainable business leadership, said CECP corporate heads; only 17 percent endorsed it.

But companies are not staying silent. Another CECP poll found that 61 percent of companies are sticking to their public advocacy strategy, and more than 20 percent are advancing their support for social issues.

Since 2001, the Giving in Numbers Survey has collected data on corporate social strategy programs globally to provide professionals with the benchmarking and reporting tools to make data-driven decisions about social strategy.

With the release of “Investing in Society,” CECP’s research and data, as well as select reports from industry peers, will now be synthesized in a single presentation available to the public, with an even deeper dive supported by facts and figures available to affiliated companies.


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Europe Finds Funds for Rewilding

Europe Finds Funds for Rewilding

At the signing ceremony in Brussels, from left: Karmenu Vella, European Commissioner for Environment, Maritime Affairs and Fisheries, Frans Schepers, Managing Director of Rewilding Europe, Christopher Knowles, European Investment Bank, Head of Climate Finance and Jyrki Katainen, European Commission Vice-President for Jobs, Growth, Investment and Competitiveness. April 11, 2017 (Photo courtesy European Commission) Public domain

By Sunny Lewis

BRUSSELS, Belgium, April 25, 2017 (Maximpact.com News) – Catching on in Europe, rewilding is large-scale conservation to restore and protect natural processes and core wilderness areas, provide connectivity between such areas, and protect or reintroduce apex predators and keystone species.

The Dutch nonprofit Rewilding Europe says rewilding ensures that natural processes and wild species will play a much greater role in both landscapes and seascapes. Rewilding helps landscapes become wilder, while providing opportunities for people to reconnect with such wilder places for the benefit of all life.

Now the concept of rewilding Europe has attracted substantial investment to turn these goals into reality.

Earlier this month, the European Commission and the European Investment Bank announced the first loan agreement backed by the Natural Capital Financing Facility.

The €6 million loan agreement with Rewilding Europe Capital is expected to provide support for more than 30 nature-focused businesses across Europe.

Rewilding Europe Capital (REC) is Europe’s first conservation and rewilding enterprise financing facility. With this first project, an ambitious new initiative to protect biodiversity and support climate adaptation in Europe has been realized.

The REC investment capital available is €6.5 million. This loan finance contract represents the first project of the Bank on Nature Initiative, set up by the European Commission. The signing ceremony took place April 11 in the Berlaymont Building, headquarters of the European Commission in Brussels.

The Bank on Nature Initiative builds on the Natural Capital Financing Facility, an established financing partnership between the European Commission and the European Investment Bank supporting nature and climate adaptation projects through tailored loans and investments, backed by an EU guarantee.

It recognizes and fosters the business case for investing in natural capital for biodiversity and climate change adaptation purposes.

Nature is essential for our lives, well-being and also underpins our economy,” said Karmenu Vella, European Commissioner for Environment, Maritime Affairs and Fisheries, at the signing ceremony.

The recent evaluation of the EU Nature Directives has shown that creating new means to attract investment in nature protection and its sustainable use is more important today than ever before. I am particularly pleased that the first project signed under the Natural Capital Financing Facility will directly contribute to the implementation of our EU Nature Directives and also boost our rural economies and create jobs,” Vella said.

Since its formal launch in September 2013 and supported by the Adessium Foundation and Dutch Postcode Lottery, REC has demonstrated its potential through a pilot phase which Rewilding Europe has now extended in this new partnership with the European Investment Bank and their Natural Capital Financing Facility.

REC provides loans to small and medium-sized enterprises that catalyze, support or achieve positive environmental outcomes.

Loans may go to fund natural forest regeneration, natural water systems, natural grazing, safe corridors for wildlife, natural habitat extension, reduced hunting and fishing pressure, operational support of wildlife breeding areas including spawning sites, and direct natural comeback of wildlife.

“In places like Namibia and Costa Rica, significant nature-based economies have been developed by stimulating private sector involvement and investment,” says Frans Schepers, managing director of Rewilding Europe. “In Europe, where such economies are still in their infancy, we can learn a lot from these countries.”

“The Bank on Nature Initiative has the potential to stimulate the development of nature-based economies and I am excited that Rewilding Europe Capital can help facilitate it,” said Schepers. “Both nature and people will benefit.”

Since the launch of its pilot phase in 2013, REC has provided €445,000 in loans to 17 enterprises in five countries – Portugal, Italy, Croatia, Netherlands and Romania.

These are collectively leveraging the protection of 20,000 hectares of natural landscapes and will inject over €25,000 of direct cash funding per year towards protecting and sustaining these host natural environments and their wildlife.

Naturally, this investment also directly and indirectly stimulates local socio-economic growth and employment.

“Signed today, this contract with the EIB is a great step forward for Rewilding Europe Capital,” says Ilko Bosman, executive director of Rewilding Europe Capital B.V. “It will allow us to really scale up our efforts and beneficial outcomes. But more than this, it also throws a spotlight on the ability of commercial finance to contribute positively to nature conservation and rewilding.”

The long-term goal of Rewilding Europe Capital is to create 250 jobs through the businesses which it supports. Going forward, it will continue to stimulate and underpin wildlife and nature-based businesses in rural areas, thereby making an essential contribution to the comeback of wild nature and wildlife in European landscapes.

Rewilding Europe Capital was established and developed with business and financial expertise from Conservation Capital, an initiating partner of Rewilding Europe, and who will also support the investment management of the portfolio.

The entire effort is supported by the European Commission’s LIFE Programme, the EU’s financial instrument supporting environmental, nature conservation and climate action projects throughout the EU.

Since 1992, LIFE has co-financed some 4,306 projects. For the 2014-2020 funding period, LIFE will contribute roughly €3.4 billion to the protection of the environment and climate.


Featured Image: One of the resident Konik ponies on the UK’s Ashdown Forest. These wild horses originate from Poland, bred from the original, now extinct, wild horses of Europe known as Tarpan. Konik ponies show numerous primitive features, associated with their ancestors: adaptation to harsh climates, intelligence and resilient immune systems. February 13, 2017 (Photo by Tom Lee) Creative Commons license via Flickr

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Europe’s Microcredit Providers Have It EaSI

Europes Microcredit Providers Have It EaSIBy Sunny Lewis

BRUSSELS, Belgium, February 28, 2017 (Maximpact.com News) – The European Investment Fund and Nest Bank earlier this month signed a microfinance agreement aimed at supporting micro-businesses in Poland under the new EU Programme for Employment and Social Innovation (EaSI).

EaSI is a new source of funding, offered by the European Investment Fund and the European Commission, to help micro-credit and social enterprise finance providers develop their businesses.

The EaSI guarantee plan provides support to financial intermediaries that offer microloans to entrepreneurs or finance to social enterprises that would not have been able to obtain financing otherwise due to risk considerations.

The goal is to increase access to microfinance for vulnerable groups who want to set up or develop their business and micro-enterprises, through loans of up to €25,000.

EaSI aims to contribute to the implementation of the Europe 2020 strategy by supporting the EU’s objective of high level employment, guaranteeing adequate social protection, fighting against social exclusion and poverty and improving working conditions.

The new EaSI Capacity Building Investments Window will reinforce the capacity of selected financial intermediaries in the areas of microfinance and social enterprise finance.

Through equity investments such as seed financing and risk capital, EaSI will support the development of these finance providers in their efforts to do things such as open a new branch, invest in human resources, develop a new IT tool or finance expenses.

PolandBitspirationWoman

Dorota Zys is a Polish entrepreneur in the field of Internet and mobile applications with extensive experience in website design and digital marketing consultancy. She has advised professionals and trained over 100 companies in Inbound Marketing principles and their application. (Photo courtesy Bitspiration 2016) Posted for media use.


In Poland, with the financial backing of the European Commission, the European Investment Fund is providing a guarantee that will enable Nest Bank to provide over €9 million worth of loans on favorable conditions to about 1,300 microbusinesses in Poland over the next three years.

Earlier this month, France became the first EU Member State to benefit under EaSI from the support of the European Fund for Strategic Investments, the heart of the Investment Plan for Europe.

This guarantee will allow Initiative France to award more than €10 million in interest-free loans to more than 500 French microenterprises over the next three years.

The European Investment Fund is using its EaSI guarantee to support Initiative France in the context of its Initiative Remarquable unsecured loans intended for businesses taking an economically responsible approach and creating jobs.

Announcing the new capacity building project, EU Commissioner for Employment, Social Affairs, Skills and Labour Mobility Marianne Thyssen said in December, “Ultimately, these investments will help increase the offer and opportunities for micro-borrowers and social enterprises.”

“It responds to the needs of financial institutions that want to build up their capacity and reinforce the offer on the market,” Thyssen said. “Through this instrument, we confirm our commitment to give a boost to jobs and growth and help the most vulnerable people in the labour market.

At the signature event in Paris in December, EIB Vice-President Ambroise Fayolle said “The Juncker Plan continues to develop in France, with 46 operations signed in France so far, accounting for a total amount of €3.1 billion, which is expected to generate an additional €15.9 billion.

This new agreement with Initiative France marks an important milestone in the EIB Group’s support for small French firms,” said Fayolle. “By extending the scheme to businesses in the weakest regions, to job creators in priority districts and young student entrepreneurs, we will further develop our financing and support aims.”

The 222 platforms of the Initiative France associative network of creative financing and corporate buyers provide unsecured loans to 19,000 entrepreneurs each year.

At least 60 percent are unemployed. They are expected to create and develop over 16,000 businesses, creating more than 40,000 jobs.

The progress of 55,000 entrepreneurs is being followed, and 9,000 of them are being mentored.

Louis Schweitzer, president of Initiative France, explained, “This new support from the European Investment Fund confirms the effectiveness of the unique Initiative France model in general and of the Initiative Remarquable program in particular.  We are also very proud to be the first beneficiaries in Europe of EU support under its EaSI program.

In 2015, €176 million of unsecured loans led to over €1 billion in bank loans. These local associations, well-integrated into their local areas, have 950 staff and 16,180 volunteers, including 4,640 business mentors to support new entrepreneurs.

The combination of the mentoring, the loans, and the banking services has helped these enterprises to achieve a 88 percent survival rate over three years, compared with a national rate of 70 percent, according to the French National Institute for Statistics and Economic Studies.

EIF Chief Executive Pier Luigi Gilibert, said, “I am confident that the EaSI Capacity Building Investments Window will be instrumental in strengthening the operational and institutional capabilities of micro-credit and social finance providers.”

Capacity building is fundamental for finance providers to be able to deliver on their investment objectives in an effective and sustainable manner,” Gilibert emphasized. “I am pleased to see that EIF will support those finance providers in creating an investment friendly environment.”

Gilibert said the EaSI Capacity Building Investments Window reflects the European Commission’s “strong commitment” to launch initiatives aiming at boosting jobs, growth and investment.

Launched in June 2015, EaSI is managed directly by the European Commission. The total budget for 2014-2020 is €919,469,000 in 2013 prices.

Also, for the first time, the European Commission is helping social enterprises through investments of up to €500,000.

The European Commission is reinforcing the social dimension of the European Fund for Strategic Investments for both microfinance and social entrepreneurship. Overall, the total amount of support to these areas is expected to increase from €193 million under the EaSI program to about €1 billion, mobilizing roughly €3 billion in additional investment.

The European Investment Fund is part of the European Investment Bank Group. Its central mission is to support Europe’s micro, small and medium-sized businesses by helping them to access finance.

In this role, EIF designs and develops venture and growth capital, guarantees and microfinance instruments which specifically target this market segment. EIF aims to foster EU objectives in support of innovation, research and development, entrepreneurship, growth, and employment.


Featured image: The European Commission is investing in micro-businesses to create jobs and support new entrepreneurs. (Photo by Peter Linke) Creative Commons license via Flickr

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Abu Dhabi Sustainability Week Glitters in the Sun

AbuDhabiSustainabilityWeek

The International Renewable Energy Agency exhibit at the World Future Energy Summit 2017, a part of Abu Dhabi Sustainability Week, January 16, 2017 (Photo courtesy IRENA) Creative Commons license via Flickr.

By Sunny Lewis

ABU DHABI, United Arab Emirates, January 19, 2017 (Maximpact.com News) – The oil-rich Middle East’s largest gathering on sustainability is happening this week, featuring the rock star business and opinion leaders who are shaping the present and future clean energy world.

An estimated 35,600 people representing 170 countries are attending Abu Dhabi Sustainability Week (ADSW) under sunny skies, including 80 government ministers, 382 exhibiting companies, and more than 200 high-level speakers.

As a global platform for addressing the interconnected challenges of clean energy, water and sustainable development, Abu Dhabi Sustainability Week has developed lasting partnerships with many of the world’s most admired experts and opinion formers on sustainability issues,” said Mohamed Jameel Al Ramahi, chief executive officer of Masdar, Abu Dhabi’s renewable energy company and the host of ADSW.

ADSW 2017 explores the theme “Practical Steps Towards a Sustainable Future” from January 12-21 with presentations, discussions and workshops on clean energy, water and waste.

From the podium, Mexico’s President Enrique Pena Nieto said, “Abu Dhabi Sustainability Week is a testament to the commitment of the United Arab Emirates to sustainable development and a new diversified, low carbon economy. Similar to how Mexico is leading the way as a developing country, the UAE was in fact the first country in the Middle East to set renewable energy targets at a time when there was widespread doubt about renewable energy’s viability and value.

Workshops are considering strategies to drive investment, implementation of the Paris Agreement on climate, and the challenges of adapting existing infrastructure to the new market reality of small-scale, distributed power.

Another critical new market reality was detailed by Michael Liebreich, founder and chairman of the Advisory Board, Bloomberg New Energy Finance, and Board member, Transport for London.

Developing countries are overtaking the wealthiest economies in attracting clean energy investment, with the Middle East & North Africa playing a growing role,” said Liebreich, citing research by Bloomberg New Energy Finance.

The global profile of ADSW is valuable in bringing emerging market opportunities to a wider stage,” he said, “thereby enabling greater cooperation between developed and developing economies.”

All kinds of clean energy investments are being forged in Abu Dhabi this week. “The clean energy sector has moved from the margins into the mainstream as a dynamic, commercially viable growth market,” Al Ramahi said.

The UAE Ministry of Energy, SKM Air-Conditioning and the Masdar Institute Wednesday signed an agreement to develop advanced energy-efficient building chillers specific to the Gulf Cooperation Council region.

If adopted nation-wide, the new efficient chillers could provide the UAE with national energy savings of over 20 percent while lowering life-cycle cooling plant costs. Currently 50 percent of the UAE’s electricity consumption goes towards cooling energy requirements, which can rise to as high as 75 percent during peak-day electricity use in the summer.

On another front, the United Arab Emirates announced a landmark new US$50 million grant fund for renewable energy projects in Caribbean island countries. 

Launched by Reem Al Hashimy, minister of state for international cooperation, the UAE-Caribbean Renewable Energy Fund is one of the largest-ever single investments in the region’s clean energy sector. It represents a significant deepening of bilateral relationships between the UAE and Caribbean countries.

Grant funding is provided by the Abu Dhabi Fund for Development, with the UAE Ministry of Foreign Affairs managing the initiative and Masdar leading implementation.

The announcement, which brings UAE development assistance for renewable energy to almost US$1 billion since 2013, was made on the sidelines of Abu Dhabi Sustainability Week, as part of the annual General Assembly meeting of the International Renewable Energy Agency (IRENA).

AminAbuDhabi

International Renewable Energy Agency Director-General Adnan Z. Amin at the World Future Energy Summit 2017, a part of Abu Dhabi Sustainability Week (Photo courtesy IRENA) Creative Commons license via Flickr.

IRENA Director-General Adnan Z. Amin anticipates great success ahead for renewable energy. “Renewables are gaining ground by nearly every measure,” he said. “Accelerating the pace of the energy transition and expanding its scope beyond the power sector will not only reduce carbon emissions, it will improve lives, create jobs, achieve development goals, and ensure a cleaner and more prosperous future.

Introducing the third and latest annual issue of IRENA’s report, “REthinking Energy,” Amin said that the falling costs of renewable energy, driven by innovations in technology and policy, is behind the rapid spread of renewables and an accompanying host of socioeconomic benefits.

As we advance deeper into a new energy paradigm, we need to pick-up the pace of our decarbonization efforts. Policies and regulations continue to remain crucial to this end and to develop the renewables market,” explained Amin. “We are seeing more and more countries hold auctions to deploy renewables, and as variable and distributed sources of renewables take-on a greater role, regulators have implemented changes to enable grid integration at scale.”

Heating and cooling, and the potential of renewables for transport, are areas where future efforts are needed,” Amin said.

REthinking Energy,” provides insights on the innovations, policy and finance driving further investment in sustainable energy system, finding that:

  • Renewable energy auctions are gaining popularity in both developed and developing countries, generating record-breaking low energy prices;
  • Demand for battery storage is increasing rapidly and playing a larger part in integrating variable renewables;
  • New capital-market instruments are helping increase available finance by offering new groups of investors access to investment opportunities;
  • Institutional investors are moving into renewable energy as it offers stable returns over the long term;
  • New business models promise new ways to finance renewable energy.

Of the clean energy technologies, the report finds that solar photovoltaics will grow the fastest in terms of capacity and output, and new ways to store electricity will be a game changer for growing variable renewable energy generation.

IRENA estimates that battery storage for electricity could increase from less than 1 GW today to 250 GW by 2030.

Cost-effective off-grid renewables already provide electricity to an estimated 90 million people worldwide. “REthinking Energy” describes how off-grid solutions can provide modern energy to hundreds of millions more people to help the world achieve its sustainable development goals.

Achieving universal electricity access by 2030, will require us to boost global power generation – nearly 60 percent of that will have to come from stand-alone and mini-grid solutions,” said Amin. “Meeting this aim with off-grid renewables depends on the right combination of policies, financing, technology and institutional capacity.

At the World Future Energy Summit 2017, a part of Abu Dhabi Sustainability Week that aims to build the business case for renewable energy, India’s solar power industry is showcasing an unprecedented range of investment opportunities, after the Indian government’s announcement of its plans to add an additional 175 GW of renewable energy to the nation’s electricity supply by 2022.

The Indian Ministry of New and Renewable Energy plans to install 100 GW of solar power, including utility-scale and rooftop solar. The remaining capacity will include 60 GW of utility-scale wind energy, 5 GW of small hydro, and 10 GW of bioenergy.

Private sector investors are showing new interest in Saudi Arabia’s solar energy market, after the nation’s leadership included plans to add 9.5 GW of renewables to the energy supply as part of Saudi Vision 2030, a strategy announced last April.

The Vision 2030 strategy sets 9.5 GW as an “initial target” to help build the Saudi renewables sector, noting that energy consumption will triple in the next 14 years. The Saudi government confirms that it aims to achieve that target by 2023, a rapid increase from the nation’s 25 MW of installed renewable energy capacity at the end of 2015.

Saudi Arabia’s plans are supported by a comprehensive restructuring of government departments responsible for energy. Vision 2030 calls for a complete review of the country’s legal and regulatory framework to allow the private sector to buy and invest in the renewable energy sector.

The projects that will flow from Saudi Arabia’s renewable energy plan create a landmark opportunity for technology manufacturers, developers and investors in solar energy, setting out a very real, very achievable ambition,” said Roberto de Diego Arozamena, CEO of Abdul Latif Jameel Energy, the largest GCC-based solar photovoltaic developer and one of the largest in the world.

A highlight of Abu Dhabi Sustainability Week took place on Monday with the awarding of this year’s Zayed Future Energy Prize to nine pioneers in renewable energy and sustainability.

Founded in 2008, the Zayed Future Energy Prize has lit up the world for more than 289 million people through the actions of its international community of winners.

This year’s Zayed Future Energy Prize winners:

Li Junfeng, director general of China’s National Center of Climate Strategy Research, won the Lifetime Achievement award for his commitment to the adoption of renewable energy in China.

General Electric won the Large Corporation award for leadership in the wind and solar energy markets. GE’s wind business alone has commissioned 41.3 GW of total generating capacity and installed more than 30,000 wind turbines to date.

Sonnen, the German smart home and commercial energy storage system manufacturer, was awarded the prize in the Small and Medium Enterprise category for leadership in providing battery storage solutions.

In the Non-Profit Organization category, UK-based Practical Action was recognized for its work in providing deprived communities with clean energy in Africa, Asia and Latin America.

Joining them were the winners in the Global High Schools category, five schools spanning five regions of the globe: Starehe Girls’ Center, Kenya for the Africa region; Green School Bali, Indonesia for the Asia region; Bolivia’s Unidad Educativa Sagrado Corazón 4 for the Americas; Belvedere College in Ireland for Europe; and Huonville High School, Tasmania, Australia for the Oceania region.

Dr. Sultan Ahmed Al Jaber, UAE Minister of State, took great satisfaction in announcing the winners. “The Zayed Future Energy Prize continues to honor the legacy of sustainability advocated by the UAE’s late founding father Sheikh Zayed bin Sultan Al Nahyan,” he said. “With each awards ceremony, the UAE leadership accelerates the pursuit of innovation, reinforces the significance of sustainability at the top of the global agenda, and gives opportunities and far-reaching benefits to communities around the world.

Since the start of the Zayed Future Energy Prize awards, over 25 million people in Africa and Asia have been provided with access to modern, clean energy, off-setting more than one billion tons of carbon emissions, and ensuring that 17 million school age children can study at night using innovative solar-powered utilities.

Chair of the Zayed Future Energy Prize Jury Ólafur Ragnar Grímsson, former president of the Republic of Iceland, said, “Through the sustainable actions of its winners, the Zayed Future Energy Prize is a model example for how far the world has come in the last nine years. It is extraordinary that, through the impact of each winner and the lives they continue to improve, we now see a growing strength in being able to deliver a sustainable future.


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Maximpact’s Tom Holland Founder & CEO was proud to attended the ADSW from Maximpact‘s Masdar City Office.

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Europe’s ‘Clean Energy Revolution’

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Gemasolar was the first commercial-scale plant in the world to apply central tower receiver and molten salt heat storage technology. The molten salt storage tank permits independent electrical generation for up to 15 hours without any solar feed. May 7, 2009, Seville, Spain. (Photo by Markel Redondo / Greenpeace)

By Sunny Lewis

BRUSSELS, Belgium, December 8, 2016 (Maximpact.com News) – To keep the EU competitive as renewables displace fossil fuels, shaking up global energy markets, the European Commission has proposed a new package of measures to “equip all European citizens and businesses with the means to make the most of the clean energy transition.”

The “Clean Energy for All Europeans” legislative proposals are designed to show that, as the Commission said, “the clean energy transition is the growth sector of the future – that’s where the smart money is.”

The measures are aimed at establishing the EU as a leader of the clean energy transition, not just a country that adapts to a renewable energy future as required by the 2015 Paris Agreement on Climate, which more than 100 nations have now formally joined.

In October 2014 the European Council, composed of the heads of state or government of the EU member states, agreed on the 2030 climate and energy policy framework for the EU.

That’s why the EU has committed to cut emissions of the greenhouse gas carbon dioxide (CO2) by at least 40 percent by 2030, less than 15 years away.

Europe is on the brink of a clean energy revolution,” said Commissioner for Climate Action and Energy Miguel Arias Cañete.

And just as we did in Paris, we can only get this right if we work together.

With these proposals, said Cañete, the Commission has cleared the way to a more competitive, modern and cleaner energy system. “Now,” he said, “we count on European Parliament and our Member States to make it a reality.”

If the new proposals become law, EU consumers of the future may have the possibility of producing and selling their own electricity, a better choice of supply, and access to reliable energy price comparison tools.

Increased transparency and better regulation give civil society more opportunities to become more involved in the energy system and respond to price signals.

The package also contains several measures aimed at protecting the most vulnerable consumers.

The EU is consolidating the enabling environment for the transition to a low carbon economy with a range of interacting policies and instruments reflected under the Energy Union Strategy, one of the 10 priorities of the Juncker Commission.

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Caption: Commission President Jean-Claude Juncker briefs the European Parliament, Oct. 26, 2016 (Photo © European Union 2016 – European Parliament”) Creative Commons license via Flickr.

In his State of the Union Address to the European Parliament, September 14, President Jean-Claude Juncker emphasized investment.

The €315 billion Investment Plan for Europe, which we agreed just 12 months ago, has already raised €116 billion in investments in its first year of operation. And now we will take it further,” said President Juncker, doubling down on the EU’s future.

We propose to double the duration of the Fund and double its financial capacity to provide a total of at least €500 billion of investments by 2020,” Juncker said.

The Commission has already offered CO2 reduction proposals. In 2015, the executive body proposed to reform the EU Emission Trading System to ensure the energy sector and energy intensive industries deliver the needed emissions reductions.

Last summer, the Commission proposed ways of accelerating the low-carbon transition in other key sectors of the European economy.

Today’s proposals present the key remaining pieces to fully implement the EU’s 2030 climate and energy framework on renewables and energy efficiency.

All the Energy Union related legislative proposals presented by the Commission in 2015 and 2016 need to be addressed as a priority by the European Parliament and Council.

Modernising the EU’s economy is key, said Vice-President for Energy Union Maroš Šefcovic. “Having led the global climate action in recent years,” he said, “Europe is now showing by example by creating the conditions for sustainable jobs, growth and investment.

Clean energies, in total, attracted global investment of over €300 billion in 2015, and the Commission sees opportunity for the EU in the clean energy wave of the near future.

By mobilising up to €177 billion of public and private investment a year from 2021, this package can generate up to one percent increase in GDP over the next decade and create 900,000 new jobs, the Commission said.

The Clean Energy for All Europeans legislative proposals cover energy efficiency, renewable energy, the design of the electricity market, security of electricity supply and governance rules for the Energy Union.

The Commission also proposes a new way forward for Ecodesign, the law that sets minimum mandatory requirements for the energy efficiency of household appliances, information and communication technologies and engineering.

The package includes actions to accelerate clean energy innovation, to renovate Europe’s buildings and a strategy for connected and automated mobility.

Commissioner Cañete said, “I’m particularly proud of the binding 30 percent energy efficiency target, as it will reduce our dependency on energy imports, create jobs and cut more emissions.

Our proposals provide a strong market pull for new technologies,” he said, “set the right conditions for investors, empower consumers, make energy markets work better and help us meet our climate targets.

Links to all documents in the Clean Energy package:


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Genuine Sustainability Attracts Savvy Investors

RockTennWaste

RockTenn, based in Norcross, Georgia, one of North America’s leading manufacturers of corrugated and consumer packaging, has been focused on reducing the amount of solid waste it sends to landfills. By engaging employees from every department, such as finishing inspector Byron Manning, at one of the company’s packaging factories, RockTenn recycles much of its process waste. (Photo courtesy RockTenn)

By Sunny Lewis

BOSTON, Massachusetts, May 26, 2016 (Maximpact.com News) – Attracting “sustainability-savvy investors” entails much more than conserving a little energy or doing a little recycling.

“Investors want to be sure that a company’s sustainability efforts are focused on the material issues that affect its ability to thrive and survive,” advises Boston Consulting Group’s latest sustainability report , authored in collaboration with MIT Sloan Management Review and published earlier this month.

These investors want to know “the business specifics of how sustainability is creating value for the companies they invest in. A host of factors drives that value, ranging from reduced costs of capital to greater innovation.

Based on a survey of more than 3,000 executives and managers from more than 100 countries, the report is titled, “Investing for a Sustainable Future: Investors Care More About Sustainability Than Many Executives Believe.”

Today’s investors have access to richer data and more sophisticated analytics than the investors of the past and their opinions are better grounded in accurate information. As a result, 75 percent of investors now think that increased operational efficiency often accompanies sustainability progress.

The research showed that although 90 percent of executives see sustainability as important, only 60 percent of companies have a sustainability strategy in place, and just 25 percent have developed a clear sustainability business case as a compelling story to woo investors.

The report advises, “Executives who want investor support need to develop and tell their sustainability value-creation story. That value, according to our survey, stems from three interrelated components: a sustainability strategy, a clear business case, and business model changes that realize the benefits.”

The report uses General Electric as an example. In 2004, the company embraced sustainability as a growth driver by establishing Ecomagination brands, focused on environmental safety.

During the recent global economic crisis, these brands were GE’s only source of growth. They grew by 12 percent while other revenues shrank by 2 percent. In 2010, Ecomagination products drove $85 billion in revenue. By 2014, the number had jumped to $200 billion.

Managing sustainability well can attract investors, the authors conclude, using Mitsubishi Corporation as a case in point.

In 2015, Mitsubishi announced that it was making a $1.1 billion investment in Olam International, an agricultural trading company based in Singapore.

Many believed that the purchase was driven by Mitsubishi’s desire to capitalize on growing incomes and consumption in emerging markets. But Mitsubishi was  drawn to the company’s sustainability footprint and its expertise in working with small farmers and producers in remote areas of Asia and Africa.

And on the bottom line – a profit. Olam’s sustainability footprint drove a 29 percent premium over the company’s 2014 average share price.

Earning a reputation as a sustainable business isn’t enough any more either – the reputation doesn’t seem to be as important to investors as how a company uses sustainable practices to create value.

Dow Jones has offered a sustainability index since 1999, and the “Financial Times” has produced its FTSE4 Good Index since 2001, but these mainstay indices appear to be losing their luster for investors; corporate executives seem to care more about these lists than investors do.

Look at the responses from managers in publicly traded companies – 32 percent say their company is listed on a sustainability index, but 36 percent didn’t know if their company was listed or not.

Investors care even less. Only 36 percent of investor respondents said that a company’s inclusion in a major index is an important factor in investment decisions.

“One reason is that data in many sustainability indices is self-reported and usually vetted for completeness, not accuracy,” the report states.

Corporate leaders may believe their place on these lists or indices has brand reputation value that attracts consumers even if potential investors don’t care about them.

But they may begrudge the corporate time and resources spent filling out sustainability questionnaires, especially if they don’t believe investors impute value to these rankings.

Fifty thousand companies are annually subject to environmental, social and governance (ESG) evaluations by 150 ratings systems on approximately 10,000 performance metrics.

The diversity of organizations and systems, ratings, and metrics has led many corporate sustainability managers to the verge of “survey fatigue.”

Yet sustainability is increasingly important for investors, as evidence mounts that a company’s ESG performance has an impact on long-term financial success.

BCG’s 7th sustainability report with MIT Sloan Management Review found that 75 percent of senior executives in investment firms see a company’s sustainability performance as “materially important to their investment decisions.”

Nearly half would not invest in a company with a poor sustainability track record, yet, only 60 percent of managers in publicly traded companies believe that good sustainability practices influence investment decisions.

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Inspector John Nicholson with the Nuclear Regulatory Commission and Robert Clark, a radiation control physicist with the Connecticut Dept. of Environmental Protection, at a remediated brook on the ABB, Inc. property in Windsor, Connecticut, take measurements and collect soil samples to verify that the site is clear of radioactive contamination, Sept. 12, 2011 (Photo by Nuclear Regulatory Commission) Public domain


Featured Image: Zond wind turbines rise up amidst a young corn crop at the Buffalo Ridge wind farm in southwest Minnesota. (Photo by Warren Gretz / National Renewable Energy Lab) Public domain

Attracting Investors with a Business Plan

Attracting Investors with a Business Plan

Maximpact Services

Attracting Investors: What Investors Look for in a Business Plan

Entrepreneurs, businesses and projects rely on investment capital to hit the ground running. The groundwork and roadmap must be laid out within a solid investor-ready business plan. The activation of the best business plan starts out with catching the investor’s interest.

Therefore, a strategic business plan is essential in getting the funding you are looking for from VCs, accelerator, angel investors or other types of funders. First impressions are the most lasting.

Cutting to the chase

Venture capitalists, accelerators and angel investors are extremely busy and expect entrepreneur to do the required homework before approaching them. They only choose to take projects to the next level that have a solid business plan. (Read our blog on “ Are You Investment Ready” ).

A business plan shows investors how well you know your market, product, strategy and exit plan. Unless your investors are strictly family and friends, a third party’s main concern is how your product or service will achieve traction in the marketplace, profitability and what are the possible exit strategies.

Why is a business plan needed?

Many ask whether they need a business plan. The answer is “yes”.

A business plan is the answer to the question, “What do you aim to accomplish?” It is the blueprint and brainwork for the entrepreneur, management and the investor. It conveys vision and strategy to investors, laying out the path to success – where your business will have greater profitability and increased assets.

What is an investment ready business plan?

It is the aforementioned potential profitability, which is demonstrated through financial projections – usually within a 3 to 5 year period – that attract investors. A business plan answers unique concerns of an investor when it:

•    concisely details the business, customer profile, company management, market strategy, and financial projections

•    creatively presents business ideas tailored for the investor audience

•    clearly demonstrates acceptable risk, investor reward, and value creation

What do investors look for when reading a business plan?

It is important to understand what the investor will look for before outing forward your pitch:

•    The business plan will map out the products or services offered, how they will gain traction and the speed at which they will do so.

•    Secondly, investors will think of is the exit – how much, how long and how will the investors earn their return?

•    Thirdly, how much investment capital is required to grow a company to the  point where they can earn a return on their investment and also many more rounds of investment might be needed for the following milestones to be reached?

Having these answers ready, will ensure you are prepared.

In addition investors are looking at a variety of factors including a solid management team or advisors with a proven record of success. They must be convinced that the product offering has a clear competitive advantage with a shot at increasing and substaining  the value of the company, i.e., this could include different markets that can be tapped into with the same product or service for future growth.

Approaching investors – what do you need?

Approaching investors is best done through intermediaries who have ties and relationship to VCs, accelerators, angel investors and other types of funders. Generally, business plans are not sent as a first communication tool to investors but is kept for later when the investor is interested in hearing more about your business or business idea.

The 3 tools that are a necessity to pitch a solid business proposal are:

1. An elevator pitch. A brief description of what your value proposition is, that will clearly show the investor what the traction of your idea is and ignite that spark of interest to carry on reading.

2. A high-concept pitch. This would be a single sentence within the elevator pitch, which highlights the startup’s vision.

3. A ten-slide deck in the form of a Power Point presentation to tell your company’s compelling story. Click here to see what the ten-slide deck should contain.

The elevator pitch is an incentive for investors to look at the ten-slide deck. The deck provides the impetus to set up a meeting and/or ask for the business plan.

Your takeaway is…

Always remember what are foremost in the minds of investors:

•    Traction: Is your product going to be a great addition to the marketplace with or without their investment.

•    Investment: How much funding is required and the terms offer.

•    The Exit: Investors put money in private companies hoping  they might cash out through an IPO some time in the future. They will consider and look closely at your exit strategy to understand potential return, timeframe to exit and different options.

Do you need to write a business plan? update an old one? or is your business plan investor ready? 

Knowing how to craft a solid, investor ready business plan and how to approach investors lays the foundation for attracting investors. Equally important is knowing the investor’s perspective, which is, above all, return on their investment. It is best to let a business plan expert help you write, complete or update your business plan. This is an investment which will improve your chances of funding success.

When considering your business plan needs take a look at how www.Maximpact.com can help. We have hundreds of highly qualified experts and consultants able to satisfy the needs of any entrepreneur or business. Whether you require them to have specialized skills or expertise in specific sectors we have them all.

We cater to all budgets and help your business evolve and meet its full potential. Our business experts will steer you in the right direction and make sure you have what you need to become investor ready.

Book a free consultation with one of our mentors by contacting us at info@maximpact.com or visit www.Maximpact.com.

20,000 Investment Funds Rated for Sustainability

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Morningstar Head of Sustainability Steven Smit (right with glasses) and Morningstar Chairman and CEO Joe Mansueto. (Screengrab from video courtesy Morningstar)

By Sunny Lewis,

CHICAGO, Illinois, March 3, 2016 (Maximpact.com News) – Evaluating mutual funds and exchange-traded funds based on how well the companies they hold manage their environmental, social, and governance (ESG) risks and opportunities just became easier.

Based in Chicago, the publicly-traded provider of independent investment research, Morningstar, Inc., has just introduced the Morningstar Sustainability Rating™ for some 20,000 funds around the world.

“Given the widespread and growing interest in sustainable investing around the world, investors need better tools to help them determine whether the funds they own or are considering adding to their portfolios reflect best sustainability practices,” said Steven Smit, CEO of Morningstar Benelux.

Smit has been named Morningstar’s head of sustainability. He will be responsible for leading the company’s initiative to bring the new ratings and metrics to investors globally.

He says the goal is to create transparency and get to one global measure – a global sustainability standard for funds worldwide.

“Creating more insight into sustainability investing is a passion of mine and many others at Morningstar,” Smit shared. This initiative will help us better serve investors who place particular importance on incorporating ESG factors into their investment decisions.”

Morningstar has operations in 27 countries in North America, Europe, Australia, and Asia. The company offers investment management services through its subsidiaries, with more than US$180 billion in assets currently under advisement and management.

“Our Sustainability Rating and related metrics will provide investors with an ESG lens they can use to evaluate funds and, eventually, other managed products,” said Smit. “It’s not so much about what the fund says it does, but what it actually holds.”

Sustainable investing goes beyond the exclusionary approach of socially responsible investment, or SRI, strategies, say Morningstar executives. Sustainable investing is a long-term approach that incorporates ESG factors into the investment process.

Jon Hale, PhD, CFA, former head of manager research for North America, has been named head of sustainability research.

“Many investors are interested in sustainable investing but unsure how to put it into practice,” Hale said. “Our new rating makes it easier to compare funds based on their ESG attributes.”

“In that way, investors can better determine how to incorporate sustainable investing into their portfolios, or assess the extent to which their fund investments are upholding best sustainability practices,” said Hale.

Morningstar calculates the ratings based on the underlying fund holdings and company-level ESG research as well as ratings from Sustainalytics, an independent provider of ESG and corporate governance ratings and research.

Sustainalytics has been analyzing companies’ ESG performance and impact since its origin as Janzi Research in Canada in 1992. The company has since joined with other analytics groups around the world and now has offices in North America, Europe, Australia and Singapore.

To help investors compile a low-carbon portfolio, Sustainalytics offers an expanded suite of Carbon Solutions, which includes portfolio analytics, data and research. Increasingly, investors are aiming to better understand their portfolio exposure to carbon, to reduce this exposure and to implement low-carbon mandates.

The new Morningstar Sustainability Rating calculation is a two-step process.

First, each fund with at least 50 percent of assets covered by a company-level ESG score from Sustainalytics receives a Morningstar®Portfolio Sustainability Score™.

The Portfolio Sustainability Score is an asset-weighted average of normalized company-level ESG scores with deductions for companies involved in controversies over such activities as environmental accidents, fraud, or discriminatory behavior.

The Morningstar Sustainability Rating is the Portfolio Sustainability Score compared with at least 10 category peers, assigned in a bell curve distribution.

 

SustainabilityRating

Sustainability is indicated with globe icons. Funds can receive any of five Sustainability Ratings – Low, Below Average, Average, Above Average, and High. Low equals one globe and High equals five globes.

 

 

 

 

 

Funds can receive any of five Sustainability Ratings – Low, Below Average, Average, Above Average, and High. Ratings are indicated by globe icons. Low equals one globe and High equals five globes.

Of the 20,000 funds with Morningstar Sustainability Ratings, 10 percent received five globes, 22.5 percent received four globes, 35 percent received three globes, 22.5 percent received two globes, and 10 percent received just one globe.

“Some firms say that they invest according to sustainability principles, but it’s been hard to verify,” Hale explained. “Now investors can draw their own conclusions, using an independent, robust check of that claim that’s based on comprehensive analysis of a fund’s holdings.”

Morningstar will update Portfolio Sustainability Scores when it receives new fund holdings data and will base them on the latest company scores from Sustainalytics.

Morningstar will update the Sustainability Rating each month using the most recent Portfolio Sustainability Scores.

Morningstar’s first analysis of the ratings shows that funds with explicit sustainable or responsible mandates are generally practicing what they preach. But Morningstar notes that such funds make up only about two percent of the fund universe.

Two out of three funds with explicit sustainable or responsible mandates received the highest ratings, more than double the percentage of all funds with Sustainability Ratings.

Morningstar Chairman and CEO Joe Mansueto said, “Sustainability research is the next big initiative at Morningstar. We’re incredibly excited about it. … We believe our new sustainability research will be good, not just for investors, but also for society.”


Award-winning journalist Sunny Lewis is founding editor in chief of the Environment News Service (ENS), the original daily wire service of the environment, publishing since 1990.

Happy Employees Attract SRI Fund Investments

WomanWorkerAssemblyLine

By Sunny Lewis

WARWICK, UK, February 11, 2016 (Maximpact.com News) – Google employees enjoy free rides to work at the California company’s headquarters campus, plus breakfast, lunch, and even dinner if they stay late – for free. New dads receive six weeks of paid leave, and moms can take 18 weeks. And Googlers can even bring their pets to work.

Employees at the Silicon Valley Internet giant enjoy free oil changes and car washes, massages and yoga, a play room, back-up child care assistance and $12,000 a year in tuition reimbursement.

Other California tech companies, too, top numerous lists of the best places to work. The California-based business software company Intuit offers education support up to $5,000 a year, as long as the employee’s courses are related to financial services. At the office, employees enjoy a state-of-the-art gym, dry cleaning services and on-site therapeutic massages.

Dr. Onur Kemal Tosun of Warwick Business School points to Pride Transport, a Utah-based trucking company. “It uses employee engagement as a competitive advantage to keep good drivers. Not only is their pay competitive, but they find accommodation for them while they are on the road and help their families while the truckers are away,” he says.

Dr. Tosun has just published a study of 1,585 U.S. corporations and 47 socially responsible investment (SRI) funds in which he quantifies how much more investment from socially responsible funds employee satisfaction attracted. He concluded it was 35 percent.

“This increased investment makes sense as firms investing in their employees signal high corporate social responsibility (CSR), which in turn potentially enhances a firm’s reputation and prestige,” said Tosun, an assistant professor of finance in Warwick Business School at University of Warwick.

“Improvements in this area of CSR have been known to boost loyalty, employee contribution, and motivation through which productivity, firm performance and firm value increase. Naturally, this would draw funds’ investment,” he said.

“Increases in society CSR, such as improving housing in a bad neighborhood by a construction company or covering education fees for local children, also sees firms gain a significant growth in investment,” Tosun explained.

“McDonald’s is a good example,” he said, “it has a society focus CSR. Ronald McDonald House Charities provides free ‘home away from home’ accommodation to families while their child is in hospital.”

As it happens, more than 16 percent of the assets under professional management in the United States are in SRI funds. This sector is growing quickly. SRI funds expanded their portfolios about 76 percent over two years – from $3.74 trillion (2012) to $6.57 trillion (2014).

For his study, Tosun created a unique new measure of investment patterns. “I use a comprehensive measure that combines SRI funds’ own CSR perception with corporate CSR scores to explain funds’ investment in these firms,” he explains.

A firm’s CSR score was measured by summing “Strengths” and “Concerns” of each issue area in the “Kinder, Lydenberg, and Domini Index.”

Funds’ CSR sensitivity was evaluated by SRI funds’ investment policy data for positive investment or negative, restricted, investment, available from Bloomberg’s Environmental, Social and Governance Service.

Tosun then combined the CSR score of each company with the CSR sensitivity of each SRI mutual fund investing in that firm.

“My research also shows firms in specific sectors can benefit more from increased CSR efforts, but on the whole CSR investment is a worthwhile endeavor for any firm looking to attract SRI funds,” he says.

But Tosun writes that CSR investments might not improve a fund’s bottom line, although they had higher returns than the market during the crisis period of 2007-2008.

“I show funds having CSR sensitivity underperform the market in general,” he writes, “and fail to improve their portfolio performance after they invest in firms with high CSR.”

The study, “Is Corporate Social Responsibility Sufficient Enough to Explain the Investment by Socially Responsible Funds?” has been submitted for publication to a number of finance journals.

HappyWorkingWomanAward-winning journalist Sunny Lewis is founding editor in chief of the Environment News Service (ENS), the original daily wire service of the environment, publishing since 1990.


Main image: Workers on the Scania front axle assembly line (Photo by Scania Group) creative commons license via flickr.
Bottom image: This happy woman works at TimeWarner in the Media Sales division. (Photo by Dylan H.) creative commons license via flickr.

TPP Unites Old Enemies, Makes New Ones

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Maori (Indigenous New Zealander’s) demonstrate against the Trans-Pacific Partnership in Auckland, February 4, 2016

 

 

 

 

By Sunny Lewis

AUCKLAND, New Zealand, February 9, 2016 (Maximpact.com News) – “We expect this historic agreement to promote economic growth, support higher-paying jobs; enhance innovation, productivity and competitiveness; raise living standards; reduce poverty in our countries; and to promote transparency, good governance, and strong labor and environmental protections,” declared the ministers of the 12 Trans-Pacific Partnership (TPP) countries on February 4 as they signed the document that for the first time opens trade across the region.

The TPP eliminates 98 percent of all tariffs among the 12 countries: Australia, Brunei Darussalam, Canada, Chile, Japan, Malaysia, Mexico, New Zealand, Peru, Singapore, United States and Vietnam.

The agreement includes former enemies at war as well as overwhelmingly Catholic countries such as Peru and Chile, the Buddhist-Shinto country of Japan, and majority Muslim nations such as Brunei and Malaysia.

But many civil society groups oppose the agreement for a host of reasons. They warn it will undermine environmental protections, human rights, labor rights, indigenous rights and internet freedom, despite official assurances to the contrary.

After more than five years of negotiations, ministers finalized the text at a session in Atlanta, Georgia on October 5, 2015 and agreed to sign it within 90 days. That signing event took place in Auckland on February 4, 2016.

New Zealand Prime Minister John Key said the agreement “will be overwhelmingly positive for New Zealand in supporting more trade and investment, jobs and incomes.”

“TPP will provide much better access for goods and services to more than 800 million people across the TPP countries, which make up 36 percent of global GDP,” said Key. “TPP is our biggest-ever free trade deal and is estimated to boost our economy by at least $2.7 billion a year by 2030.”

“It is New Zealand’s first Free Trade Agreement relationship with five of the TPP countries, including the largest and third-largest economies in the world – the United States and Japan. Successive New Zealand governments have been working to achieve this for 25 years, the prime minister said.

Prime Minister Key views the TPP as not only good for New Zealand, but also for the entire Asia Pacific region.

“Other countries have already signalled an interest in joining TPP and this could lead to even greater regional economic integration. A more prosperous and therefore secure region, is in all of our interests,” Key said.

The next step is for member countries to ratify the TPP so it can take effect.

The agreement can take effect only with the approval of at least six countries, which account for at least 85 percent of the combined gross domestic product of all member nations.

This means that it must be adopted by the legislatures of the two largest TPP economies, the United States and Japan.

Just 71 years ago, the United States dropped nuclear bombs on Japanese cities, as the two nations were bitter enemies locked in a struggle for control of the Pacific during World War II.

But now Japanese Prime Minister Shinzo Abe says the Trans-Pacific Partnership will allow Japan and the United States together to write the rules for the global economy.

Speaking at an economic forum in Tokyo in October, the day after the long-secret text of the TPP was made public, Abe said, “Rules should not be something that are imposed on you – you make them. The TPP is the structure where Japan and the U.S. can lead in economic rule-making.”

TPPprotestVirginia

The TPP protest movement has been building for years. Here, American workers demonstrate against the Trans-Pacific Partnership in Leesburg, Virginia, September 9, 2012. CWA stands for Communications Workers of America.

 

 

U.S. President Barack Obama said after the document was signed on February 4, “TPP allows America – and not countries like China – to write the rules of the road in the 21st century, which is especially important in a region as dynamic as the Asia-Pacific.”

“It eliminates more than 18,000 taxes that various countries put on Made in America products,” said Obama. “It promotes a free and open Internet and prevents unfair laws that restrict the free flow of data and information.”

“It includes the strongest labor standards and environmental commitments in history – and, unlike in past agreements, these standards are fully enforceable.”

Fifty years ago, the United States and Vietnam were engaged in a fierce war, and U.S. demonstrations against involvement in the Vietnam war sharply divided the country.

Today, both countries are signatories to the Trans-Pacific Partnership.

Authorized by Prime Minister Nguyen Tan Dung, Minister of Industry and Trade Vu Huy Hoang took part in the signing ceremony in Auckland.

The World Bank’s latest “Taking Stock” report features a special section on the Trans-Pacific Partnership Agreement, in which it projects that the TPP is expected to generate considerable benefits for Vietnam, despite “implementation challenges.”

“The recently concluded TPP will not only improve market access, but will also serve as a critical anchor for the next phase of structural reforms in Vietnam.” says Sandeep Mahajan, lead economist for the World Bank Vietnam.

As the TPP economy with the lowest per capita GDP, Vietnam has unique comparative advantages, particularly in labor-intensive manufacturing. Simulations suggest that the TPP could add as much as eight percent to Vietnam’s GDP, 17 percent to its real exports, and 12 percent to its capital stock over the next 20 years.

An agreement that opens trade, forges bonds between old enemies, and brings together 800 million people of many different faiths and languages – what could go wrong?

Plenty, according to protesters in some of the TPP countries.

Environmentalists object to language such as this. “3. The Parties further recognize that it is inappropriate to establish or use their environmental laws or other measures in a manner which would constitute a disguised restriction on trade or investment between the Parties.”

A movement of labor, environmental, family farm, consumer, faith and other organizations has escalated its campaign to defeat the Trans-Pacific Partnership with a joint 1,525-group letter urging the U.S. Congress to oppose the trade agreement.

“As you would expect from a deal negotiated behind closed doors with hundreds of corporate advisors, while the public and the press were shut out, the TPP would reward a handful of well-connected elites at the expense of our economy, environment and public health,” said Arthur Stamoulis, executive director of Citizens Trade Campaign, which organized the letter.

The TPP would roll back environmental enforcement provisions found in all U.S. trade agreements since the George W. Bush administration, requiring enforcement of only one out of the seven environmental treaties covered by Bush-era trade agreements, Stamoulis charged in a letter to supporters emailed last week.

“Beyond just failing to mention the term “climate change” in its thousands of pages, the TPP would also provide corporations with new tools for attacking environmental and consumer protections, while simultaneously increasing the export of climate-disrupting fossil fuels,” Stamoulis wrote.

The U.S.-based global climate campaign 350.org called the TPP “a toxic deal that would give dangerous new powers to the fossil fuel industry and pose a serious harm to the climate.”

“The TPP is a fossil fuel industry handout,” said Payal Parekh, 350.org Global Managing Director. “This partnership in pollution gives corporations the right to challenge any local government or community that tries to keep fossil fuels in the ground.”

“The deal signed in New Zealand today makes a mockery of the climate agreement decided in Paris last December. If countries are serious about addressing the climate crisis, they need to stand up to coal, oil and gas companies, not reward them with new rights and privileges,” Parekh warned.

350.org is one of many organizations around the world that will be mobilizing members to fight back against the TPP and block its final approval and implementation.

Corporate Accountability International, based in Boston, states, “We oppose the TPP because it prioritizes corporate interests over public health, the environment, human rights, and democracy.”

In Kuala Lumpur in January, some 5,000 Malaysians protested the TPP on Saturday, days before parliament was due to open a debate on the pact.

Many of the demonstrators were from the opposition Parti Islam Se-Malaysia (PAS). They voiced fears that their country could lose control of its economy if it enters the partnership with the United States.

The Canadian nonprofit OpenMedia calls the TPP a “reckless Internet censorship deal.”

“We are planning to grow a global coalition and build an international action platform to turn public opinion against the TPP, country by country. We will jam public consultations, build an international action kit, and support our allies across the globe to kill this agreement once and for all.”

“The TPP won’t come into force until it gets ratified,” says OpenMedia. “That means the final and most crucial phase of the battle begins today.”


 

Award-winning journalist Sunny Lewis is founding editor in chief of the Environment News Service (ENS), the original daily wire service of the environment, publishing since 1990.

Featured image:  U.S. Trade Representative Michael Froman (right) attend the Trans-Pacific Partnership Ministerial Meeting in Sydney, October 25, 2014. Both men signed the TPP pact February 4, 2016. (Photo by TPP Media Australia) under creative commons license via Flickr
Main image : Maori demonstrators against TPP (Photo by Dominic Hartnett) under creative commons license via Flickr
Image 01: American workers demonstrate against the Trans-Pacific Partnership in Leesburg, Virginia, September 9, 2012. CWA stands for Communications Workers of America. (Photo by GlobalTradeWatch) under creative commons license via Flickr

Green Groups Guide Investors to Protected Areas

GLAND, Switzerland, December 1, 2015 (Maximpact News) – Two of the world’s largest and most influential nonprofit groups have made a new 10-year commitment, combining their strengths to enhance the role of protected and conserved areas in achieving sustainable development.

The International Union for the Conservation of Nature (IUCN) and the World Wildlife Fund (WWF) have pledged to expand the number of protected areas reaching IUCN Green List quality standards to at least 1,000 protected areas in 50 countries.

The partnership will look at how challenges to protected areas such as poaching, illegal logging and other destructive activities can be addressed through new financing and investment.

The two organizations have promised to seek the application of US$2 billion of new investment funding for the enhanced performance and sustainability of these Green List protected areas.

And the groups say they will generate at least 20 new ambitious protected area commitments for biodiversity and United Nations’ Sustainable Development Goals from communities, governments and other organizations.

The two groups, both based in Gland, believe that by combining their strengths they will multiply their chances of making a major contribution towards achieving the Sustainable Development Goals.

The IUCN-WWF partnership was announced on the first anniversary of the IUCN World Parks Congress, which took place in November 2014 in Sydney, Australia and culminated in the Promise of Sydney.

The Promise of Sydney commits signers to invest in protected areas, which help to halt biodiversity loss; mitigate and adapt to climate change; reduce the risk and impact of disasters; improve food and water security, and promote human health and dignity.

The Promise of Sydney encompasses four elements:

A Vision that reflects a set of high-level aspirations and recommendations for the change needed in the coming decade to accomplish conservation and development goals for parks, people and planet.

Twelve Innovative Approaches to transformative change to: achieve conservation goals, respond to climate change, improve health and well-being, support human life, reconcile development challenges, enhance the diversity and quality of governance, respect indigenous and traditional knowledge, inspire a new generation, protect World Heritage sites, conserve the marine environment, develop greater capacity for effective action and create a new social compact.

The third element of the Promise of Sydney is a Panorama of Inspiring Protected Area Solutions to overcome obstacles to the stability of people and protected areas. Supported by IUCN, its Commissions and members, they can serve as reference points and resources for conservation practitioners around the world.

The fourth element is Promises. These are pledges by countries, groups of countries, funders, organizations and other partners to chart the path forward for the world by stepping up or supporting accelerated implementation.

For instance, the U.S. National Park Service committed to setting up a program to engage 100,000 youth in protected areas across the United States.

South Africa committed to more than triple its ocean protection over the next 10 years, from less than 0.5 percent to five percent of its Exclusive Economic Zone within Marine Protected Areas. South Africa will do this to ensure environmental sustainability because MPAs deliver ecosystem services that underpin South African livelihoods, food security and ecotourism.

Russia committed to grow its protected area network by establishing at least 27 federal protected areas and expanding 12 others, increasing the total area of federal protected areas by 22 percent, or 13 million hectares.

Critical habitats for important threatened species, including the Amur tiger in the Bikin River watershed in Russia’s Far East, the polar bear in the Novosibirsk Archipelago, the Siberian crane in Yakutia, and the Beluga whale in the White Sea near the Solovetsky Archipelago, among others, will be granted protection.

Japan’s Ministry of the Environment committed to working with the IUCN Asia Regional Office to enhance collaboration among Asian countries on protected areas management through the Asia Protected Area Partnership, which was officially established during the IUCN World Parks Congress 2014.

China committed to increase its protected areas territory to at least 20 percent by 2020, and to match Chinese categories of protected areas to global standards.

The Promise of Sydney is the foundation for pathways the WWF and IUCN can take over the next 10 years to ensure that protected areas can be perceived as one of the best investments in the planet’s future.

The 10-year partnership aims to make the case for direct investment in protected areas and protected area systems that demonstrate enhanced conservation outcomes.


Award-winning journalist Sunny Lewis is founding editor in chief of the Environment News Service (ENS), the original daily wire service of the environment, publishing since 1990.

Featured image: A wildebeest grazes beside a vast flock of flamingos at Tanzania’s Lake Magadi in the Ngorongoro Conservation Area. (Photo courtesy IUCN World Parks Congress)
Slideshow Images: A.  The Three Sisters – Australia’s Blue Mountains National Park is located in the Blue Mountains region of New South Wales, in eastern Australia. (Photo courtesy Nosha via Flickr) B. Half Dome seen from Glacier Point in Yosemite National Park, California, USA (Photo courtesy IUCN World Parks Congress) C. Guere Community conservation area, Choiseul, Solomon Islands (Photo courtesy IUCN World Parks Congress)