Money – billions of dollars of it – is on the move and it’s going deep green. Investors and asset managers are accelerating their push to decarbonize the global economy – start-ups and SMEs better take note because this is becoming your future, too.
I have spent the better part of two decades sitting on both sides of start-up accelerator tables, sometimes as a mentor and coach, other times as a start-up founder. It’s given me a front row seat into local and national idea generation and commercialization trends, but I’ve never seen a trend move as quickly as 2021’s net-zero push.
A quick look through my business newsfeed tells a compelling story. According to Bloomberg, in 2020 governments and others raised a record $490 billion USD selling green, social and sustainability bonds, while an additional $347 billion went into investment funds focused on environment, social and governance (ESG). BlackRock, the world’s largest asset manager, aims to invest $1.2 trillion in ESG funds by 2030, and CEO Larry Fink is demanding greater disclosure from companies as to how business plans will be compatible with a carbon-zero future.
Canada is moving forward, too. A November 2020 survey by the Responsible Investment Association (RIA) reported that Canadian investment in ESG funds jumped to $3.2 trillion in 2019, a jump of 48 per cent over two years. And then there’s Mark Carney, former Bank of Canada head and now UN envoy for climate and finance. He’s also the lead on Brookfield’s ESG business. On Feb. 10, Canada’s largest asset manager announced the creation of its $7.5 billion Global Transition Fund – possibly the largest in the world – devoted to achieving net-zero.
This is what economic disruption looks like and no one will escape untouched. While on the surface this may appear to be a boon for renewable energy producers and other ‘green’ businesses, the change we are embarking on goes far deeper.
Getting to net-zero is what systems change experts like to call an ‘all-of-society’ challenge – so big that no one sector or group can solve this problem alone. It’s going to require that each of us make changes to how we operate.
Some, and I’d like to count 3D Planeta in this category, are being proactive and already put business decisions and choices through a climate change and sustainability lens. Others will be forced to change by larger clients and customers who will now be actively looking for ‘net-zero-friendly’ firms with which to do business.
Why? Because hand-in-hand with the push for sustainable business practices comes an equally disruptive trend: a push by shareholders and stakeholders for proof that a company’s sustainability promise is backed up by tangible action. Expect it to include public disclosure regarding supply chains and how each link in that chain is actively working to achieve net-zero emissions or some other sustainability measure.
Over the past 12 months, as I’ve attended video conference investor calls and accelerator-via-Zoom gatherings, I’ve noted a rising interest in 3D Planeta’s environmental and social activities and in the reasoning behind our very deliberate actions to be a ‘green’ tech company. We don’t sell green technology; we live it as a company and in 2021 that’s a differentiator of rising financial and reputational value.
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