BERLIN, June 25, 2020
BERLIN, June 25, 2020 /PRNewswire/ --
- @ quarterly online Berlin Green Investment Summit, 25 June 20, 16h - 16h45:
- Climate change, a far graver threat than COVID-19, can be reversed profitably
- Long-term divest-invest strategies have delivered 10% financial returns p.a.
- eg. Climate Endowment Hydropower Fund targets > 100x less CO2, 8-14% IRR
- Citizens', pensions' & insurances' traditional asset allocations offer mediocre returns
- Investors, businesses, citizens need CO2 price reflecting externalities
- German Federal Environmental Agency estimates externalities at €640/ton of CO2
- 27 Nobel Prize laureates call for CO2 tax & border duty, redistributed per capita
- Under EU Green New Deal: all finance must be climate-goal compliant
- Blended finance offering preferred returns needed to address market failures quickly
In the absence of sufficient action from governments to address climate change, the global impact investor network 'Toniic', the Institutional Investor Group on Climate Change (IIGCC) whose members manage €30 Trillion, the German business network supporting the Paris goal, 'Stiftung 2 Grad', family office and climate impact investment adviser Wermuth Asset Management GmbH, cohost the 5th Berlin Green Investment Summit (BGIS), in the form of 45-minute webinars at tea time - 16h CET on each quarter's last Thursday - until we meet again - on
'How to close the climate finance gap'
During 'virtual high tea' sessions, treat yourself to a cup of tea, some scones with clotted cream and strawberries, learn from great speakers, participate in Q&A and break-out sessions and commit to act to address the greatest challenge and opportunity facing humanity.
The 25 June, 2020 webinar starts with Jochen Wermuth, climate impact investor and investment committee member of Germany's SWF KENFO stressing the urgency of the climate finance gap to be closed, the profitability of divest-invest strategies, and the need for a CO2 price reflecting externalities.
Laurence Tubiana, CEO, European Climate Foundation & Chair of the Board of Governors, French Development Agency will provide updates on the EU's Green Deal, on the UNFCCC COP26 finance track led by Mark Carney and France's Convention citoyenne pour le climat.
Those will be discussed by Peter Damgaard-Jensen (Chair, IIGCC), given key demands by IIGCC to G20, Phillipe Desfossés (Co-Founder Climate Endowment & ex-CEO, €40bn pension fund ERAFP), given the climate finance gap and disparity between the returns of large endowments (10%) and EU pension funds (3%), Dr. Gilbert Frizberg (former Chairman of the board of Verbund AG) given the launch of the Climate Endowment Hydropower Fund with >100x less CO2 emissions and 8% target returns, and Astrid Manroth, Director of Climate Finance, European Climate Foundation, given the need for blended finance initiatives to tab into the €150 trillion global debt & equity capital markets and to offer decent returns to citizens.
"Pension funds might not to be able to match their liabilities over the next 20 years without substantial changes to their asset allocation strategy. They can both lift returns and abate climate change by moving to alternatives with lower CO2 footprints," says Phillipe Defossés, co-founder of the Climate Endowment.
Background info on key subject and institutions mentioned:
The Climate Finance Gap: https://www.ceres.org/initiatives/clean-trillion
The Ceres Clean Trillion highlights the need for an additional $1 trillion per year in clean energy investment [as estimated by the International Energy Agency and the International Renewable Energy Agency] to limit global temperature rise to below 1.5 degrees Celsius and avoid the worst impacts of climate change.
Global clean energy transition is both essential and irreversible, and it will generate tens of trillions of dollars of clean energy investment opportunities over the decades to come. Energy market dynamics have shifted in favor of clean energy such as wind and solar, which increasingly out-compete new fossil fuel and nuclear power sources. As the clean energy market continues to mature and expand into a mainstream, large-scale market, there is a growing and diversifying array of investment opportunities.
Achieving the Clean Trillion is eminently feasible, and our most recent research points to the significant opportunities for investors to scale up their clean energy investments while meeting their risk-return requirements. Companies likewise are realizing the economic benefits of shifting to clean energy as they make commitments to meet their energy demands with renewable energy, energy efficiency, and electrification of vehicle fleets.
We are a global community of asset owners seeking deeper positive net impact across the spectrum of capital.
Our members consist of more than 400 high net worth individuals, family office, and foundation asset owners who are deepening their impact across the spectrum of capital and personal resources in more than 25 countries around the world.
Institutional Investor Group on Climate Change: www.iigcc.org
Investors taking action for a prosperous, low carbon future:
Our mission is to mobilie capital for the low carbon transition and to ensure resilience to the impacts of a changing climate by collaborating with business, policy makers and fellow investors.
The investor voice on climate change:
The Institutional Investors Group on Climate Change (IIGCC) is the European membership body for investor collaboration on climate change and the voice of investors taking action for a prosperous, low carbon future. IIGCC has more than 240 members, mainly pension funds and asset managers, across 15 countries, with over €33 trillion in assets under management.
IIGCC's mission is to mobilize capital for the low carbon transition and to ensure resilience to the impacts of a changing climate by collaborating with business, policy makers and fellow investors. IIGCC works to support and help define the public policies, investment practices and corporate behaviours that address the long-term risks and opportunities associated with climate change.
Stiftung 2 Grad: https://www.stiftung2grad.de/
The most important aim of Foundation 2° – German Businesses for Climate Protection is in the name: to limit average global warming to well below two degrees Celsius.
The exclusive and immediate aim of the foundation is to promote climate protection and the sustainable use of natural resources and natural ecosystems.
We are working to support politicians in establishing free-market framework requirements for climate protection, and to activate German businesses to find solutions for climate protection.
Cross-Industry Platform for Active Collaboration: Foundation 2°:
Foundation 2° is more than just an alliance between businesses. It is a platform for active collaboration in which businesses from different industries work together in a solution-oriented manner to find answers to questions of corporate climate protection.
Under the umbrella of a not-for-profit, independent foundation, the supporting businesses can work toward more open outcomes and on more complex issues of climate policy than would be possible in individual businesses. In addition, the supporting businesses consciously form a small and flexible group which can react quickly to political and economic trends and developments.
Wermuth Asset Management GmbH, https://wermutham.com/
Incubated as the principal family's single family office adviser in 1999, WAM has evolved into a climate impact investment adviser with a focus on high risk-adjusted financial returns alongside positive climate impact across all asset classes.
Our Green Growth Funds invest in "exponential organizations" as defined by Singularity University, companies with the potential to solve a major problem of humanity (climate change in our case) profitably and grow exponentially.
Our forestry strategy turned operations covering 1m hectares, or 4x the size of Luxemburg, into a Forestry Stewardship Council (FSC) compliant profitable operation.
Our long/short divest-invest strategy has returned some 10% per annum long-term.
Through the Climate Endowment Group we aim to offer institutional investors the ability to invest across all asset classes with positive impact on climate abatement. The ultimate aim is to also to "democratize" long-term alternative and climate impact investments by listing the assets, which the Climate Endowment Fund will hold, allowing any citizens to participate in this long-term endowment-style investment vehicle.
Climate Endowment Group, https://climate-endowment.com/
Climate Endowment is a climate-focused investment company employing the multi-asset class endowment style, pioneered by Yale and Harvard university endowments. We aim to achieve both solid long-term risk-adjusted returns and a significant reduction of CO2 emissions. It was launched by experienced investment professionals and entrepreneurs as an urgent response to the Climate Crisis and to the European voters' demand for a Green Revolution.
We seek lower risk and lower return investments than most of the private equity industry and aim to cater to the risk profile of more conservative investors. Climate Endowment focuses on investments in scalable platforms with infrastructure / hard asset characteristics based on proven technologies with significantly lower CO2 emissions.
Climate Endowment Hydropower Fund
The "Climate Endowment Hydropower Fund" will be the first product of the Climate Endowment Group. The fund will be launched as an open-ended Luxemburg RAIF to professional investors this summer. The fund aims to achieve 8% IRR through investments in green- and brown-field mid-sized run-of-river hydropower plants. "Run-of-river" implies that there is far less negative environmental impact than for larger hydropower plants that close off whole valleys with large barrages. Hydropower plants have a typical live of 80 to more than 100 years, generate stable cash flows and produce power at less than 1/100th the CO2 footprint per kilowatt-hour produced than the average for EU power production.