Impact A.M. Launch Edition

BETTER BUSINESS BEGINS WITH PURPOSE

It's now or never:

the turning point for ESG

02

WELCOME TO
IMPACT A.M.

The environmental, social and governance agenda is at an inflection point. Soaring
energy prices, rampant greenwashing and a fundamental lack of definition in the
sector have fuelled concerns of its demise and sparked fears of a retreat from the
progress made over the past decade.

It faces challenges, certainly. But the alarmist conversations this year do not
always reflect the action taking place underneath. Investors, regulators and many
businesses have not taken their foot off the accelerator and are scrambling to bring clarity and progress
to an area that has been abused and misused for too long.

Now, as we face a pivotal moment for the future of ESG, Impact A.M. has gathered some of the City’s
leading thinkers to discuss the challenges facing the movement - and how we might go about
solving them.

Lead Journalist Contributing Journalist Contributing journalist Impact A.M. is a publication by The City A.M. Media
Charlie Conchie Jack Mendel Niall Slattery Group
St Magnus House,
3 Lower Thames Street,
London, EC3R 6HD
Tel:02032018900
Email: [email protected]

Commercial Team
Chief Digital & Marketing Officer Darren Rebeiro
ESG Campaigns Director Alfie Brown
Production Team: Caitlin Glynn Jodie Mordan, Danni
Meng, Sarah Green

03

INSIDE
THIS ISSUE

22 We talk about the three
Cs , with John McCalla-
Leacy

06 The globe is warming, 08 How ESG has impacted 10 The Power of FinTec, 12 Sustainability
with Julia Streets technology, with Russ with Janine Hirt Superheroes, with Tony
Shaw Craddock

14 Wall Street without the 20 Do we care about the 30 A new ‘golden source’ , 32 Blockchain helping
Walls world, with Angeli Arora with Nina Spencer climate, with Jane
Thomason

04

05

THE GLOBE IS WARMING.
REGULATORS ARE

WARNING.  INVESTORS
ARE CALLING.

By Guest Author Julia Streets

What’s bubbling up as we boil the ESG aligning with the emerging EU and SEC frameworks. But as we
ocean? know, from standardization, accountability and transparency
The globe is warming. Regulators will surely flow, as will innovation.
are warning. Investors are calling. All mouth, little money? Money talks, so how invested are
Climate change is felt by we? I asked our client Substantive Research because they
every one of us and it dominates provide independent comparison and discovery on investment
discussions from the sofa at home, to research, ESG and market data pricing and products. They say
the office, to the world’s leading conference stages. that the actual demand seems not to tally with the enthusiasm
and marketing. It’s true that asset managers are demanding
Whatever your perspective: concerned citizen or ESG data, however they suggest that this represents less
commercial entity (and the two are by no means mutually than five per cent of average data budgets. Does this mean
exclusive) we are all figuring out how to respond. How do we’re ahead of a wave to come if the data and standardisation
we appease and appeal to customers; satisfy investors and challenge is addressed?
shareholders; respond and engage with policy makers and Technology will deliver scale and pace. It’s exciting to see how
governments; assure our regulators? How do we embed this in fin and tech firms are stepping up to provide analytics and
our culture in an engaging way that lets our workforce know insights, launching products and services rooted in addressing
that we care deeply about these issues? the sustainability goals and designed to drive transformation.
Blockchain is emerging as a great enabler, extending beyond
My life is a fascinating mix of advising fintech clients from simply immutable ledgers to help producers and distributors
startups and scale ups to global organisations, as well as being a generate, store and share energy production. New operating
professional host, speaker and podcaster. As I write, fresh from models built on open source, distributed ecosystem platforms
the autumnal stages of some of the world’s largest financial are expected to deliver scalable results, but I’m hearing a call
industry conferences, I can report that climate change and ESG for a shake-up of procurement policies to unlock collaboration
dominate. And as host of Shell’s ‘The Energy Podcast’ series I’ve with innovators. This reminds me of the early days of our
been exploring the practicalities and realities of decarbonising fintech age, so positive change is entirely possible.
our everyday and industrial materials. Industrial age transition and economic investment is
needed. A Tanzanian climate change expert explained to
I am honoured that CityAM has invited me to share some me that in order to progress quickly through the phases of
of the thoughts that are ‘bubbling up’ in my mind. It’s by no industrial evolution, African countries (and other developing
means an exhaustive list, rather offered as cause for pause, to nations) need urgent financial support. She also cautioned
hopefully inspire some discussion. It is also a timely moment that examining change purely from a first world perspective
to announce I am also hosting City A.M.’s newest show Impact could set expectations and tracks running, far removed from
A.M. Live where for everyone that wants to learn more about the reality, appreciation and capacity to change at a grassroots
ESG and can be found on the Impact AM hub on cityam.com level. So, it does need further appropriate thought.
Aligned intentions, variable progress. The headlines and
marketing collateral shout proudly of commitments to ESG, This is such an important area of focus and thank you to
climate change and sustainability, however not all claims CityAM for dedicating these pages to the discussion. It takes
appear to stack-up and regulators’ patience for greenwashing time and focus to understand and assess corporate transition
appears to be fast waning. Just look at the fines. And the pathways, break down the marketing rhetoric, unpick supply
reputational stakes are high. We will watch conscious chains and innovation ROI roadmaps. Whatever your reaction
customers turn tail on brands caught making false or to my thoughts, we can all agree that we don’t have the luxury
unsubstantiated claims. Is the risk worth it? of time. We must move at pace, and at scale. We must support
We’re craving data. The industry needs, craves, clamours for the wave of current fintech and climate tech innovation, but
data and industry groups have responded with new indices and also look beyond, to harness the great potential of Web 3.0, the
frameworks. So now the call is for standardisation. metaverse, quantum computing, spacetech and more.

Industry bodies are collaborating and it seems that
simplicity may well win through with the formation of the ISSB
(International Sustainability Standards Board), combining
with other bodies and parties. It is striving to become the
standards body for the industry, although it faces challenges in

06

07

HOW ESG HAS
IMPACTED

TECHNOLOGY
AND INNOVATION

SECTORS

Russ Shaw CBE is the Founder of Tech London
Advocates and Global Tech Advocates

By Niall Slattery

Increasing examples of processes and practices to support more companies must commit to reworking
environmental, social and data-driven decisions and ultimately their business models while new
governance (ESG) targets push ESG commitments forward. players benefit from infusing high ESG
linking to executive incentive  Greenwashing standards from the outset.
pay (sometimes as much as  Existing Technologies
20 per cent) represents a  Unfortunately, for some companies,
financially lucrative area ‘addressing’ ESG issues simply  The international clamour for
business leaders need to ensure they are represents a box-ticking exercise. greater focus on ESG has shed light on
getting right. the energy efficiency of hardware and
Despite compliance efforts from software technologies. The exponentially
 ESG is a broad term comprising the government, artificially inflating increasing demand for data from
interlinked yet distinctive ways to environmental and social standards consumers, businesses, and emerging
evaluate the sustainability credentials continues to be an uncomfortable reality technologies, combined with the already
of a business, including corporate in the corporate world. high energy consumption of data centres
governance, inclusion and diversity, (an estimated one per cent of worldwide
employee health and safety and For ESG targets to be effective, they electricity use), has forced data centres
community impact. must be woven into everyday business to be at the forefront of innovation in
operations, practice, and Culture. responding to ESG pressures.
 With bonuses in the balance, ESG
objectives have taken on further  Thankfully, all is not yet lost.  Data centre companies like Interxion
strategic significance. Companies now Innovations such as natural language have pioneered energy-saving designs
address every stage of their supply processing (NLP) technologies have and harnessed new cooling strategies
chain and business model, including the begun solving this problem. NLP — a such as arctic winds and underground
technologies and services they acquire. form of artificial intelligence (AI) — can aquifers to reduce their carbon footprint.
analyse billions of online articles to
 The financial, social and detect greenwashing or related risks. These efforts have evidently
environmental incentives around This technology can assist in holding succeeded in the previous decade.
ESG provide the tech and innovation deceptive sustainability marketers to Even as data use has skyrocketed,
sectors with substantial opportunities account on a considerable scale. technological advancements such as
to capitalise on. As the saying goes: processor efficiency improvements,
‘necessity is the mother of invention.’  Separating existing companies from idle power reductions and applications'
Technology will underpin new products, the vibrant start-up community is virtualisation have significantly reduced
essential when assessing the UK tech
sector’s response to ESG. Established

08

Russ Shaw CBE

the number of servers and energy exciting opportunities for tech While more companies at least appear
Requirements. companies to address internal energy to prioritise DEI, the measure of success
waste management. With improved is in the numbers.
 Other efforts include carbon modelling and analysis, these companies
offsetting and renewable energy can more effectively target ESG  London is the most multicultural
procurement. Google — an excellent initiatives like cheaper, more efficient city in the world; its workforce and board
example of best practice in this space drug development or enhanced water rooms should reflect that.
— has set a target for all its data centres treatment capabilities.
to operate on round-the-clock (RTC)  Diversity, Equity and Inclusion (DEI) Therefore, DEI must remain a
renewable energy by 2030. top priority for those in positions of
 Despite advances in some areas of power – government leaders, CEOs,
 While this is by no means the end ESG, it is essential to be open about the and boards. Investing in digital skills
of the story for data centres, with an inadequate progress on diversity, equity education cannot be overstated, and
expected eight per cent increase in total and inclusion (DEI) in the UK tech sector. critical barriers to entering the industry,
electricity demand over the next decade, Despite the exponential growth of the particularly foundational language,
the agility and innovation demonstrated digital economy, the figures on DEI technical skills and personal aspirations,
by this industry should be recognised remain poor, with opportunities still must be proactively dismantled.
and mirrored where possible. falling into the hands of the same people.
 Emerging Technologies For example, women only hold five per  DEI needs addressing at a cultural
cent of leadership positions in UK tech, level across the sector, but technologies
 Measuring and finding solutions and just nine per cent of IT Directors can also help scale and support these
to businesses' ESG impact is a fruitful come from black, Asian, or minority initiatives. Tech vendors in this market
area for emerging tech companies. For ethnic groups (British Computer have increased rapidly, with software
example, blockchain has enabled the Society). able to identify and remove unconscious
development of trusted, standardised bias from hiring and promotion
ESG data collection and reporting. Global  The business case for DEI has decisions leading to more significant
manufacturers are using this technology repeatedly been made over the past equity in payroll along with reliable
to trace assets across the supply decade, yet we appear to stagnate on tracking of progress towards inclusion
chain, improving their sustainability progress. The responsibility falls on goals.
credentials and reporting procedures our industry leaders to command an  Looking ahead
through Transparency. inclusive culture.
 ESG will continue to be a guiding
 Quantum computing also provides facet for the tech and innovation sectors.
Existing companies in the industry have
had to step up to ESG expectations from
customers, investors and other relevant
stakeholders. New emerging technologies
are capitalising on the demand for
innovative solutions to global problems
and holding established industry players
to account.

 ESG is a wide-ranging framework that
is difficult to navigate comprehensively.
There are multiple crucial, sensitive and
complex issues at play. Therefore, while
stakeholder expectations are rightly
high, the fundamental principles for our
sector to keep in mind are transparency,
authenticity and a willingness to change.

09

THE POWER
OF FINTECH:
DELIVERING ON THE
ESG AGENDA

Guest Author, Janine Hirt, CEO Innovate Finance

Many point This is precisely what fintechs excel at: and potentially providing advice on ways
to the 2008 using data to provide new and better of managing finances and signposting to
financial crisis products and services for consumers, further help.  
as the birth businesses, and institutions.
of the fintech Fintechs can both provide these
movement. There is an increasing focus on tools directly to the end consumer, and
At a time of providing data to measure climate also enable other financial services to
economic turmoil, innovators and new change impact and guide decision- support their customers. Companies
entrants stepped in to rebuild trust making, and fintech has the opportunity such as Minna Technologies have
and resilience in the financial sector to lead the way in filling data gaps. implemented innovative solutions for
and provide better, easier, and cheaper Policymakers can help facilitate this consumers to monitor their subscription
services to the end consumer. forward progress by working with spend; Snoop provides a free money
fintech leaders to implement reporting management and budgeting app; and
Nearly 15 years later, the world is frameworks and common definitions to TotallyMoney helps people see, manage
facing three new challenges which will enable inter-operable, consistent and and improve their credit score. These
once again require the agility, flexibility trusted data. Innovate Finance members are all
and innovative mindset of the fintech using open banking to enable people
community to successfully tackle them: Social: Tacking the Cost of Living to take control of their data and, from
a climate emergency, a cost of living Crisis Providing consumers with that, their finances. We are talking
crisis, and a drop in business trust. tangible solutions to help them in their to firms, government, regulators and
It is imperative that the ecosystem everyday lives is at the core of many organisations like Citizens Advice about
- the financial innovation industry, fintechs’ propositions. Fintech enables what more can be done, particularly
government and regulators - come people to better understand, grow, and if the rules on open banking can be
together to address these issues head on manage their money, often in an easier, extended to bring in new sources of data
and secure a better future for consumers cheaper and more transparent way. (such as mortgages) and provide small
everywhere. firms with cheaper payment processes.
According to the consumer group There is also an opportunity to work with
Environmental: Addressing a Climate Which?, in 2022 alone 2 million the regulator to agree how we can widen
Catastrophe households will have missed a bill access to financial advice through data
payment every month as people and tech-enabled robo-advice.
Technology plays a key role in making struggle to keep up with costs. Fintechs
financial services greener and more have an important role to play here in Governance: Rebuilding Trust in
sustainable, and the UK is a global leader driving down this number, by enabling Business
in the green finance space. Tackling individuals and SMEs to take control
climate change depends upon rewiring of their finances by gaining access to a Fintech is the crown jewel of the
finance in order to direct capital to complete picture of household income UK tech and financial services sectors,
activities aligned to Net Zero, which will and outgoings; forecasting possible and consumer trust has been key
be achieved by combining finance with future scenarios during a time of volatile to its success to date. The Fintech
data that measures real world outcomes. prices, energy costs and interest rates; community’s approach to transparency

10

businesses are not and its focus on the customer has paved ethically and responsibly, and driving a
doing enough to tackle the way for its growth. diverse and inclusive workforce. Proper
societal issues such as governance is the foundation of this.
We know that trust in businesses
climate change. across all sectors and industries around The way forward
the world has been dropping. According We have seen a maturation of the
to Edelman’s 2022 Trust Barometer, fintech industry in recent years, as
over half of consumers globally believe companies which were once considered
that businesses are not doing enough new entrants are now integral players
to tackle societal issues such as climate of the financial services sector with
change. Many fintech founders are substantial market share, partnerships
driven by the desire to create a fairer, between established firms and startups
more equitable, and more inclusive are growing, and new entrants are
financial services sector that works driving even greater transformation and
better for all. As our fintechs scale and democratisation across the industry.
grow, finding ways of maintaining and Fintech is redefining financial services
renewing this sense of social purpose and what it means to the consumer. If
becomes all the more important. In the we are to achieve our goals around ESG,
same vein, it is critical that this sense of we must continue to support this sector
positive purpose is reflected internally, and allow innovation across financial
through ensuring a company acts services to thrive.

11

SUSTAINABILITY

SUPERHEROES IN

PrettyLittleThing FINTECH
sponsored Love
Island’s Gemma Tony Craddock, Director General of The Payments Association
Owen to champion By Niall Slattery
its ‘pre-loved’ fashion
marketplace this more challenging – telling investors that delivering finance options aligned
year, encouraging returns may be more modest if they are to growing sustainability-focused
shoppers to sell clothes rather than to achieve their ESG goals. customers. These principles are
throw them away. fundamentally intertwined with
 However, it still expects to launch  Enter the ‘Sustainability Superheroes’ sustainable development, enabling them
956 new fashion items into the hands who have developed superpowers to foster a community spirit across their
of hungry consumers this week. Did through their journeys and are member base.
someone say greenwashing? spearheading the quest to build a more Charlie Bronks
 It’s one thing to say, ‘Climate change sustainable fintech industry.
matters; we should all do something  Our second Sustainability Superhero
about it’. It’s quite another to design  Our first superhero is the Corporate is Charlie Bronks, Head of ESG at the
your whole business around ESG goals. Development lead at Algbra, an ethical wholesale foreign exchange and cross-
Especially in fintech, when it’s harder to finance app and card service, Ramsey El border payments organisation, Crown
see our effect on the environment and Dabbagh. Agents Bank, which has a unique history
society.  Ramsey El Dabbagh of developing emerging and frontier
 Some of the Payments Association’s markets.
members have tackled this head-  He exemplifies the power of fintechs
on, aligning their businesses with to improve financial inclusion. Algbra  The bank harnesses its networks
sustainability. Even in fintech, the rules guarantees ethical values throughout and deep sector expertise to understand
of the game are shifting. Since the 1970s, its investments and funding ventures, the communities and geographies to
with a broad purpose of capital value enabling it to create value-conscious transform local economies and provide
creation, the main focus for business financial options for society, resulting in solutions to push economic inclusion
leaders has been to maximise profit to outstanding sustainability achievements and sustainable Development.
improve shareholder returns. and commercial success.
 Their superpower uses already-
The new game is  Faith-based groups are often established trust with international
sustainability, bringing underserved, and banking is often linked stakeholders to work with tier one and
opportunity to differentiate to unsustainable and unethical practices tier two banks in countries to grow
and attract new markets at odds with many individuals’ beliefs. relationships. Crown Agents Bank
but risking allegations of also partners with mobile network
 The Algbra team ensures its operators to advance technology access.
greenwashing. operations and services are ethical,
providing principle-first banking and
 The new game is sustainability,
bringing opportunity to differentiate
and attract new markets but risking
allegations of greenwashing. Or even

12

For example, biometric solutions business’, says Nadia. But adaptation little things to deliver ESG goals, some
help overcome specific issues around is vital to ensure that ESG efforts companies are taking significant steps to
identification in countries such as shift with society. BCBBT responded walk the ESG talk in payments.
Rwanda, where many home addresses to the COVID-19 changes in payments For more insights, read Sustainability
are not formally recognised. Their with a greater focus on contactless Superheroes: a Guide to Sustainable
integration of sustainability with payments over cash and re-focused on Fintech at
innovation has enabled local people to disseminating these technologies to www.thepaymentsassociation.org
open bank accounts without a formal urban areas, blending greater economic
address. This community-focused work mobility with social benefits. While Tony Craddock
directly improves financial inclusion working with Filipino transport agencies
outcomes. to integrate cashless and paperless
 Nadia Benaissa ticketing systems, the BPCBT team kept
vulnerable users in mind, embedding
 Our third sustainability superhero students' and elderly individuals’ free
is Nadia Benaissa, Global Marketing passes into their cards or phones, thus
Director at BPCBT, a fintech that easing the adoption process.
embraces local knowledge and partners
with experts to contribute to sustainable  Finally, we are seeing changes in how
development. Nadia explains how executives are incentivised and rewarded
tailoring solutions to cater to those to become more sustainable. Our
excluded by traditional banking across member respondents to EthicsGrade’s
diverse urban environments ‘requires 2022 survey for our association show
long-term partnerships with local significant plans across the industry to
governments, NGOs, international incentivise executives on sustainability
development organisations and and that, on average, seven per cent
businesses’. of discretionary pay is linked to ESG
performance amongst our members who
 ‘BPCBT has provided the ability to responded to the survey.
help our clients grow responsibly, and in
turn, this has helped BPCBT grow their  Rather than doing a few pretty

13

WALL STREET
WITHOUT THE

WALLS

Solving the world’s most pressing problems by redirecting capital is at the heart of Emanuela
Vartolomei’s bid to create real change to the financial system.

by Jack Mendel

Her model uses to put a process around it. of hitting 1.5c and that a 3c was the
artificial  Inspired by advice from a Toronto- central scenario. In that case, as a planet
intelligence to we are in adaptation territory”.
measure 13 million based lawyer who recommended building
companies at a a virtual investment research hub, she  But this view is still not reflected in
“hyper-scale”, to went about automating the process. corporate and investor reporting. She
“reinvent research” wants every company report on what
and propel firms and governments to  ‘We collaborated with the University they are doing to address climate and
ESG transparency. of Cambridge and managed to build our adaptation with the ones that aren’t
But what is All Street Sevva and what first 25 Cognitive Robots. They happened doing anything likely to disappear.
does it do? to be in ESG (Environmental and Social
Governance). Over the years we have  “I’m not exaggerating.” She said,.
 Romanian-born London-based refined our offering and we now have “The markets think this too. Schroders
Vartolomei explains “Sevva is a Sanskrit over 500 robots covering multiple areas Economics Group’s base case carbon
word that means ‘selfless service for the of sustainability.” price assumption is $400 per ton, which
benefit of all of humanity’. It reflects will wipe out the profits of hundreds of
our social mission to help direct capital  Having grown up under the iron companies.”
towards solving our most pressing curtain in Romania, Eastern Europe, she  How would you explain how your AI
planetary and societal needs.” said her journey from communism to arrives at its ESG rating for publicly
CEO was motivated by the generational listed companies?
 She explains, “its purpose, identifying change powering her youth.
the problem that there are three million  “We have built hundreds of Cognitive
financial institutions globally and 13  “I have always been interested in Robots which are trained machine
million companies. All of them will need creating systemic change” she said, learning algorithms that can read
sustainability assessment if we want “having also experienced upheaval, millions of documents in any language
capital to flow to the right ones. obtaining her MBA in the financial and retrieve ESG information. Our
crisis, but facing a personal challenge system has over 2 trillion AI inferences.”
 Today human analysts do this because there were no jobs”.
assessment manually, and if we carry on  “This means that we can analyse the
like this, it will be impossible to address It was also an opportunity’because ESG profile for 70,000 listed companies
this challenge. it was clear to me that we needed a globally. And we can automatically
different kind of financial system. benchmark every company against all
 If you want to solve the problem at the other companies of similar size and
scale, then only artificial intelligence  I was the first person to map out what industry.”
can do this. And this is why we say we are such a system could be like.”  What are challenges with taking Sevva
reinventing research.” mainstream?
 All Street Sevva started as an  Vartolomei doesn’t think about
investment research firm which became having ESG goals though. “I like to think  “We face the same challenges as other
"unmanageable because it had a network of this in terms of the challenges for our ESG providers, namely that there is a
of 70 analysts producing the research. planet and society.” small but vocal contingent, consisting
Vartolomei had to track where they were mainly of rich 20th century dinosaurs,
getting their information from, and had  Writing this as world leaders meet that is trying to take down ESG.”
in Sharm-El Sheikh for COP 27, she
said “earlier this year I interviewed 30  “They paint ESG as a type of
investment and ESG leaders and there is
a very clear view that we had no chance

14

Emanuela Vartolomei
CEO Sevva by Allstreet

investment label and it creates a populist R&D to get it right, which is why we spent from usage of the product. There is still
political movement. But everyone who is millions building Sevva. very little measurement of this.
a serious investor knows that ESG is not
a label, it is an established mainstream 90 per cent of emissions  “In response we are now moving our
field within fundamental investment caused by companies are systems to hyper-scale. We are going to
research.” take a shot at analysing those 13 million
 Where did your derive your data points within Scope 3 private companies. That will mean that
from? we can provide that big missing piece of
 Is SEVVA positioned to help the jigsaw. We are already seeing strong
 “There is data everywhere. The governments as well as firms? interest from companies, investors and
beauty of the internet is that companies governments.”
publish all types of information about  “The biggest challenge is that 90 per  Where does Sevva come in here though?
themselves. Likewise other publishers cent of emissions caused by companies
also publish information about are within Scope 3, which encompasses  “From our database, we know that
companies, including news providers.” emissions from the supply chain and 45,000 out of 70,000 companies still
do not address climate change in their
 “The challenge is not where, but how. corporate reports.
 “You need very sophisticated
technology to gather that information, “That is a much bigger problem that
categorise it, and then extract the we want to address, and one which Sevva
relevant data from it. That takes years of is uniquely positioned to solve because of
the scale of the data we make available.”

15

THE SEVVA
ESG BANKING
POWER LIST

Impact A.M. set Sevva a challenge to provide us with a

global banking snap shot by utilising its data platform

to see exactly what is driving global banks individual

ESG ratings, giving us a full dashboard of metrics and

a clearer picture of the top rated banks.

1 5 Low Medium High 9.5

0 1 2345 6 7 8 9 10

1 5 Low Medium High 9.5

0 1 2345 6 7 8 9 10

2 5 Low Medium High 9.1

0 1 2345 6 7 8 9 10

2 5 Low Medium High 9.1

0 1 2345 6 7 8 9 10

5 5 Low Medium High 9.0

0 1 2345 6 7 8 9 10

16

5 5 Low Medium High 9.0

0 1 2345 6 7 8 9 10

5 5 Low Medium High 9.0

0 1 2345 6 7 8 9 10

8 5 Low Medium High 8.9

0 1 2345 6 7 8 9 10

9 5 Low Medium High 8.8

0 1 2345 6 7 8 9 10

9 5 Low Medium High 8.8

0 1 2345 6 7 8 9 10

17

9 5 Low Medium High 8.8

0 1 2345 6 7 8 9 10

12 5 Low Medium High 8.7

0 1 2345 6 7 8 9 10

12 5 Low Medium High 8.7

0 1 2345 6 7 8 9 10

12 5 Low Medium High 8.7

0 1 2345 6 7 8 9 10

12 5 Low Medium High 8.7

0 1 2345 6 7 8 9 10

12 50 1 2 3 4 5 6 8.77 8 9 10
Low Medium High
0 1 2345 6
7 8 9 10

12 5 Low Medium High 8.7

0 1 2345 6 7 8 9 10

12 5 Low Medium High 8.6

0 1 2345 6 7 8 9 10

18

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with a difference

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reimagining

futures

recyclinglives.com

THE
NEW OIL

Alexandra Smith , Co-Founder of FuturePlus, part of The
Sustainability Group, discusses the importance of data for
businesses and their approach to sustainability.

ESG reporting has faced massive growth and Companies can evidence their current position, state their
increasing reputational issues, including intent, and intelligently track their improvement through
greenwashing, in the last few years. Critics clear indicators within defined timeframes. As a knowledge-
claim poor transparency, a lack of accuracy, based intelligence leader, FuturePlus qualifies a company's
and the inability of companies to commit to achievements into a trackable sustainability roadmap before
long-term accountability. Recent headlines quantifying them. Its indicators made up of 200-300 questions,
have brought this ever more into the fore, educate companies and business leaders to consider the
including the UK advertising watchdog, ASA, holding HSBC practicality of sustainability in a balanced way.
to account for misleading consumers with their advertised
sustainability commitments, and Brewdog losing its B Corp Key to the methodology is to provide a granular breakdown
status less than two years after gaining the certification after of achievement and intent across five themes (Climate,
several back-to-back controversies. Environment, Diversity and Inclusion, Economic and Social) as
well as an aggregate score.
However, the pressure from shareholders, stakeholders
and regulation - such as the FCA’s commitment to tackle This allows companies to create a balanced approach
greenwashing with ESG-labelled funds - is only increasing to sustainability that recognises many of the trade-offs
for public companies and SMEs to state significant climate, and interdependencies that exist in sustainability, and be
environmental and social goals, intent and progress. Because of recognised for doing the most they can under the pillars they
this, 99% of public companies expect to invest in ESG Reporting have the greatest opportunity to impact upon. Rather than
Technology and Tools over the next 12 months (Deloitte).
Like oil, data
The ESG measurement market has developed rapidly, is valuable, but if
becoming extremely competitive. Until now, the options have unrefined, it cannot
been split into two - public and private companies. For public
companies, there is a myriad of web-scraped and secondary really be used
data-led scores which consider less the sustainability of
an organisation and more the reaction of the market to its 'sustainable or not’ - a line that is tricky to draw, as companies
sustainability claims. And for those not listed, the landscape is such as BrewDog have found out - ESG needs to have a constant,
awash with ESG badges or stamps of validation, most of which dynamic tracking of social and environmental impact.
are industry, geography or theme specific with little to no
comparability across the board. This is particularly important for small to medium-sized
enterprises that make up 99% of the UK economy, which may
In addition, the focus has been on historical data, and not have existed long enough to build a compelling evidence
companies have been assessed or rated purely based on what base of past behaviour, and who will most likely want to
they have done in the past. These certifications are usually represent their intent around sustainability to investors and
valid for 2-3 years post-assessment and provide little detail
other than validation that the company is 'approved' or
'certified'. And, as we all know, past performance does not
guarantee future results.

The pressing need for all companies to play their part in
becoming more sustainable and equitable requires a more
innovative, data-led and future-focused approach.

Unlike other ESG rating vendors, FuturePlus, is the
only intuitive platform that makes managing social and
environmental impact accessible, achievable and trackable.

20

customers. By placing all the incentives on improvement, we Mike Penrose
help set the conditions for future success, not mark the card of Co-Founder at The
past achievements.
Sustainability Group
Due to the comparable nature of the ESG data, FuturePlus
is designed to provide investors with a clear, quantifiable and and FuturePlus
comparable ESG score for all of its investee companies and
for its portfolios. Investors can group companies into funds
and portfolios, understand each investee firm's score, and
demonstrate the ESG rating of each investment and fund in
verifiable terms.

The quote' data is the new oil', generally attributed to the
mathematician Clive Humby, has been doing the rounds for
nearly two decades; however, most importantly, as with most
misquotes, the second part is arguably the most important.

'Like oil, data is valuable, but if unrefined, it cannot really
be used.'

ESG data for too long has been focussed on past actions, has
been unrefined and has caused confusion and a lack of clarity.
By capturing intent and holding organisations accountable
to make the changes they state, as well as providing the
support, tools and knowledge to create a more positive impact,
FuturePlus allows companies to make the steps vitally needed
for a more equitable and sustainable economy (or world).

FuturePlus is a sustainability manage- leaders to take practical, incremental
ment platform that makes managing steps towards sustainability by focus-
social and environmental impact acces- ing on five pillars: Climate, Economic,
sible, affordable, achievable and tracka- Diversity & Inclusion, Social and Envi-
ble for every business, not just the 1%. ronment. Its plans transparently align
with all 17 of the UN’s Sustainable De-
FuturePlus qualifies a company’s velopment Goals.
sustainability achievements before
quantifying and translating them into Based in London, UK, its workforce
a realistic and trackable action plan. Its is 66% female (compared to Deloitte’s
indicators made up of 200-300 ques- global benchmark of 33% in tech com-
tions, educate companies and business panies).

21

DO WE CARE
ABOUT THE WORLD
ENOUGH TO MAKE
COMPANIES CARE?

Guest Author, Angeli Arora, Partner Mishcon De Reya

If asked who I’d love to be seated next to at a them. Accordingly, when these institutional investors exercise
hypothetical dinner party, I immediately respond, their shareholder votes in companies, they are generally
Steve Jobs. I would love to learn how he went guided by their mandate to maximise returns for their clients
about building a company that has had such an (unless their mandate provides otherwise). Consequently, fund
extraordinary impact in the world, changing the way managers are not free to take into account business ethics in
we work, live and communicate. the same way you and I can if we vote directly.
 I am not saying that Apple’s influence was
necessarily good or bad – just that it was huge.  In effect, a company only needs to do “the right thing” if it is
in its own self-interest (with a view to long term maximisation
 There is no denying companies do have the power to change of value). Sometimes doing the right thing might align with the
the world for the better or worse. Indeed, some companies have best interests of the company; sometimes, the “best interests
caused irreparable damage to the world, the extent and effects of the world” could conflict with “the best interests of the
of which are still being unearthed. company”. In that situation, a director is faced with having to
prioritise the company’s interests.
 This leads me to the following questions: should companies
have more regard for their impact in the world when they  Coming back to the initial questions (should companies
conduct their business? Do we need them to think harder about have more regard for their impact in the world when they
their “moral” obligations? And, most critically, how do we make conduct their business and how do we make that happen?), the
that happen? laws (including on fiduciary duties) can of course be changed
to impose higher minimum “ethical” standards on companies.
 As a starting point, there are laws and regulations which However, we all have the power to effect change.
prevent a company from engaging in certain harmful acts. Also,
some harmful acts give rise to legal actions. However, these  The more we factor in social responsibility when we make
laws/regulations tend to prescribe a minimum standard of our own choices (for example which companies to invest in,
acceptable behaviour for companies. what to buy and where to work), the more companies will need
to care. This is because our choices impact the success of a
 There is, of course, much more a company can do to become company – increased investment, sales, financing and talent
socially responsible – each company must make its own are all factors which contribute to a company’s success.
decision in terms of how far it wishes to go.
As we know, directors must keep the success of the company
 On what basis does a company make that decision? at the forefront of their mind when making decisions about the
What factors must it consider? When making such choices, company.
directors must be guided by their “fiduciary duties”. This
includes making decisions which most likely promote the  Accordingly, we as individuals need to start looking closely
success of the company for the benefit of its members. In at our own ethical choices before we criticise companies for
making that assessment, directors must consider “the impact their choices: do we look for the highest financial return at any
of the company’s operations on the community and the cost? Are we prepared to stand by a company that distributes a
environment”. Importantly, this is not a separate standalone lower dividend because it wishes to use cash to improve its ESG
factor that directors must consider, but something that is only performance or do we buy shares elsewhere? Do we value jobs
relevant to the extent that it affects the company’s success. in companies which may not be the highest paid but are good
corporate citizens?
 Shareholders, as owners, also have an important say in how
a company is managed, including by removing directors they  Quite simply, if we want companies to do better, then each of
do not like. The largest shareholders in public companies tend us needs to do better too.
to be institutional investors. These institutional investors have
their own duties to act in the best interests of their clients,
including to look after the money they have invested with

22

23

WE TALK ABOUT
THE THREE C'S
NOW: COST OF
LIVING, CLIMATE
AND CONFLICT 

KPMG’s ESG chief, John McCalla-Leacy, discusses the
scale of the challenge ahead

By Charlie Conchie with the ESG agenda, and rather than easing off their ESG
commitments, they should be doubling down.
ESG is a mercurial beast to grapple with at the
best of times. Standards and regulation are  “We talk a lot about the ‘three Cs’ now: cost of living, climate
yet to be consistently drawn up; definitions and conflict,” he says. “And our response is that CEOs need to
swing from a governance tool to an all- balance; they need to build ESG plans that are also working to
encompassing by-word for impact investing; mitigate the impact of the cost of living and conflict.”
and businesses and political leaders have
begun a push-back as energy prices spike in  Part and parcel of that shift in mindset is treating the ESG
the wake of war in Ukraine. agenda as a more holistic and congruous package. For many,
the acronym will immediately foreground the ‘E’ and conjure
 It’s even harder when you have to manage those competing up images of carbon emissions, tree-planting and electric
interests across 150 different countries. But that is the task of vehicles. But McCalla Leacy says that ignoring the ‘S’ and ‘G’
KPMG’s new global head of ESG John McCalla-Leacy, who was underestimates the complexity of the challenge ahead.
lifted into the global position from UK chief at the beginning of
October. “A great example is a large investment bank we work with
that had money in a coal fired power station, and they said they
 McCalla-Leacy’s brief includes the rollout of the ‘Big Four’ could pull their funding out straight away and it would make
firm’s $1.5bn ESG investment drive and he has the unenviable minimal impact to their balance sheet, but it would decimate
task of pushing sustainability up the agenda to its sprawling the local community, who relied on the jobs,” he says.
global client base.
“So they were talking about the need to retrain people locally
 And he’s taking over at a time when business chiefs shift and make sure that their withdrawal does not hit the social
into survival mode and look to shield cash at all costs rather aspect of that investment.”
than readily pump it into a net-zero drive. That cocktail
of pressures means many business chiefs still take some  The “just transition” - understanding and adapting to the
convincing of ESG’s merits, he says. needs of poorer and more under-developed economies in the
move to net- zero - will therefore be central to the success of the
 “We do still see some CEOs pushing back initially or global ESG drive, he argues. The hopes of protestors to “just stop
engaging at simply a compliance or reporting level,” he tells oil” unfortunately may therefore be a pipe dream.
Impact A.M. “But the way we talk about this is to say ‘don’t put
off until tomorrow what needs to be done today’.”  And it’s not just the moral and economic complexities that
business chiefs need to navigate. The emerging and fragmented
 While the knee-jerk reaction from business chiefs might regulatory landscape of ESG is also posing a minefield for firms
be to row back on their ESG agenda, McCalla-Leacy says most operating in multiple countries.
realise that acting now will drive growth in the longer term and
establish a softer landing when the next crisis hits.  The UK has been more forward than others in its approach
to rolling out standards and holding firms to account on them.
 “There is a change in the way we discuss ESG which looks at The Financial Conduct Authority has, for instance, introduced
achieving growth and articulates it in a very different way. Now reporting standards that require listed companies and asset
CEOs understand they need to make very significant changes managers of a certain size to report in line with internationally
in order to achieve growth,” he says. agreed standards.

 The argument is proving a tricky one to win this year,  
however. Soaring energy costs in the wake of Putin’s war have In October, the City watchdog said it will also roll out
caused countries to lean more heavily on fossil fuels once more, standards to tighten the screws on the fanciful and profligate
and public enthusiasm for net-zero and the ESG agenda more use of terms like ‘green’, ‘ESG’ and ‘sustainable’.
broadly is being tested.  
The pincers of public opinion and regulation are tightening
 Top investors are setting the tone and pouring cash back on firms, but the forces battering the global economy mean
into the world’s oil and gas firms which have been soaring on the issue is a far more nuanced and complex one that simply
global stock markets and reaping bumper profits from spiking shutting down the pumps.
prices. Just last month, the world’s biggest asset manager  
BlackRock was among a group of investors to tell a British And as he looks to explain that to an at-times reluctant
parliamentary committee that it will not stop investing in coal, client base that spans the globe, McCalla-Leacy’s task is
oil and gas. certainly looking like a complex one too. 

 But McCalla-Leacy claims that the ripples of war and
the impending cost of living crunch are inexorably linked

24

HOW REGULATION WILL
HELP ESG REACH ITS
FULL POTENTIAL

Guest Author Sacha Sadan, FCA’s Director of ESG

Iwas excited to join the FCA to communicate in a way which is “fair, claiming to do.
as its first ESG director clear, and not mis-leading”. That’s just We’ve worked closely with industry and
last year. It’s a great what we ask of any financial product. Our consumer groups on these – and we were
opportunity to use my new Consumer Duty also sets that firms excited to share them.
investor experience to help need to deliver good outcomes for retail
the financial sector move to consumers.  Labels will be a big help for ordinary
a more sustainable future. investors. But the ESG sector needs to
Whether its climate, biodiversity, supply  We’ve already introduced climate support firms as well. That’s why we’ve
chains or diversity and inclusion, there’s disclosure requirements for listed said there’s a case for regulating ESG data
lots to get stuck into. companies, as well as asset managers and rating products. We’re now working
 Consumers are also excited about ESG and owners. (And yes, we also published with the Treasury on how to make this
– our latest Financial Lives data shows our own climate disclosures – we’re happen.
that 81 per cent of adults surveyed would more than happy to walk the walk). We
like the way their money is invested to do continue to work with international  And we don’t want to develop rules
some good as well as provide a financial partners on the next steps here. in isolation – that would increase costs
return. for businesses as well as increase the
 And according to Bloomberg, we  And we warned firms who exaggerate risk of regulatory arbitrage. So we’re
should expect the pool of assets under the sustainable characteristics of their working closely with our partners
management with an ESG mandate to products and services, writing to their internationally. We want consistent
reach $50tn by 2025, from $35tn last year. Chairs last year. international standards – but we also
 On the one hand, it’s been great to don’t want to wait, our own regime
see a sector I’ve worked in for years now  In October, we published our should be a foundation for others,
really reach the mainstream. Employees proposals for the labelling of sustainable helping to raise the bar.
also care passionately. But the last year products. These will be key in helping
has brought some undeniable challenges consumers understand what they’re  The next few years are going to
– whether it’s banks in Germany being investing in. We’ll make sure that continue to be both exciting and
raided over greenwashing allegations; products which call themselves challenging for sustainability. But I’ve
senior figures in the sector publicly sustainable actually are. And we’ll ensure really enjoyed getting stuck in so far, and
questioning its value; or a steady stream there’s easily digestible information I – and the rest of the FCA team – can’t
of allegations that ESG products simply for consumers on what the product is wait to see what’s next.
don’t live up to the wide claims made.
 There’s a real risk of trust in the
sector being eroded. If that happens,
consumers’ excitement will turn to
cynicism. And that will undermine all
the progress that ESG can achieve.
 So, it’s our job, as the regulator, to
make sure that trust and transparency
are front and centre.
 That’s doesn’t mean making value
judgements about what people invest in.
Some consumers are happy to invest in
companies that are on a journey to being
more sustainable. Some only want to
invest in companies which have already
got there, and some don’t care. And others
still are more interested in the “S” and
the “G” than the “E”.
 Our goal is that firms and consumers
know what exactly they’re investing
in. We ask those selling ESG products

25

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26

LIGHTROCK:
CITY AM Q&A

By Charlie Conchie

London-based private equity outfit Lightrock closed a mammoth $860m fund
in October with the aim of fuelling a new generation of founders “tackling the

world’s biggest challenges”.

But in a world where every business claims purpose over profit, how can
investors separate the wheat from the chaff?

Lightrock partner Kevin Bone sits down with Impact A.M.
to discuss the fund’s strategy.

27

 We are looking for companies that are innovating towards a net-zero
economy, so they must be able to demonstrate clear, significant GHG

avoidance and/or mitigation.

1: You say you back purpose driven minority investors and often partner by 2050 already largely exists, but a
entrepreneurs - can we really with like minded investors to give the lot of money needed for its impact to
distinguish nowadays when almost best support to entrepreneurs on the be realised at scale. In fact, some 85
every business claims to have a purpose journey. per cent of greenhouse gas savings are
beyond profit? 3: What are some of the areas you have believed to be achievable with existing
earmarked already to put this cash into? tech. Early-stage capital has helped a
For the Lightrock Climate Impact lot of companies explore and develop
Fund, we specifically invest in firms that We have already backed a number these technologies, but investors with
measurably contribute to greenhouse gas of firms for this fund, across the five scaling experience and deep pockets
emissions reduction or avoidance across themes of the Fund's investment are now needed to help them grow and
our climate investment themes. Those strategy, in areas like green hydrogen realise both their impact and financial
themes correspond with the technology production, firming renewables and grid potential.
mix required to achieve net-zero by resilience sustainable wood production 6: Do people still see this as just impact
2050 across areas like energy transition, and circular solutions around waste/ investment or have investors really
decarbonizing industries, sustainable bioenergy. come round to the fact there are returns
food & agriculture and sustainable here?
transportation. We are constantly addressing
areas where technologies with major In the past two years, we have seen the
In addition to that ‘top down’ focus, we greenhouse gas impact potential tailwinds behind the themes we invest
look at each investment for its impact by are maturing and starting to gain in with the Lightrock Climate Impact
using our impact assessment framework commercial traction including batteries, Fund only become stronger. The climate
which is based on market standards, best long duration energy storage, green emergency is becoming more severe and
practice and which has been externally industrial processes, carbon capture and is a key focus area for everyone across
verified by an expert third party. removal, and smart data for climate. governments, corporates and consumers
4: In the UK specifically - where do you alike. Companies that provide scalable
Only those companies that exceed see the exciting areas of technology solutions to those challenges are seeing
a certain threshold following our springing up? soaring demand and strong financial, as
assessment will be considered for well as impact, returns.
investment. The UK is showing promise in many
2: With this new fund, what are the areas like novel battery chemistries, We take the view that environmental
criteria that go into an investment? carbon capture, waste utilisation (“Waste and financial returns can be mutually
What do you look for? 2 X”) and home energy management to reinforcing supported by the flow of
name but a few. talent, capital, brand loyalty and other
The Fund will make investments 5: When raising the funds, how did you factors to businesses that are driving
with a typical initial ticket size of make the growth pitch to your investors environmental (and social) change.
€10-40 million in European and North around climate?
American growth-stage companies that
operate across one or more of our climate The technology to achieve net zero
themes.

We are looking for companies that are
innovating towards a net-zero economy,
so they must be able to demonstrate
clear, significant GHG avoidance and/
or mitigation. We are particularly
interested in the “hard to abate” sectors
where progress to decarbonisation has
been slow but the impact of change in
them is hugely important.

We are growth stage investors so
do not take science risk (i.e. “will this
work?”) so in addition to our own detailed
due diligence we are also looking for
emerging commercial validation where
informed customers, often some of
the most sophisticated industrial
companies, have started to buy the
products and services.

We are happy to take scale-up and cost
down type risks as well as work through
the challenges that these entrepreneurs
face in areas such as governance and
organisation building, strategy and
financing. We are supportive, engaged,

28

29

HOW E-BIKES CAN
AND SHOULD BE
PART OF THE DRIVE
TOWARDS BETTER
CORPORATE ESG

POLICIES

By Niall Slattery

With environmental, UK. Based in central London, we have positive action for a company’s external
social and significant coverage and capacity to image and its employees’ sustainable
governance (ESG) advise, create and install sustainable values.
issues now placed active transport solutions to align
at the forefront of with the goals of sustainable corporate An employee’s decision to work at a
many corporate policies. Businesses can benefit from company is now often heavily influenced
agendas, it is easy to be sceptical about using a company with sector expertise by the ESG values the company
the actual actions taken forward versus to inform and create policies that work demonstrates. The sustainable plan
publicly voiced sustainable intentions. for their employees and their business is not only about how you are viewed
At times it has felt like many have needs. At VOLT, we have seen businesses externally by the public and your clients;
addressed what is necessary to “tick the large and small gain from this, from tech it is also about how your employees feel
ESG box” but without a genuine plan to start-ups to the NHS. you value them and how they see you
achieve and be accountable for these esteeming your position within the
policies. It is reassuring that ESG intentions sector.
are now visibly translating into real
As a British electric bicycle (e-bike) action for many corporations. Recently Over the last decade, we have all
manufacturer, we have become a go-to we have seen significant positive cultural witnessed a considerable ESG movement,
resource within the active transport changes within organisations that, as a which has visibly accelerated in the
sector, promoting sustainable active result, are driving forward sustainable previous five years, with momentum
transport and advising on sustainable agendas to make a real difference. This now at an unprecedented pace. It is
transport strategies for corporate and agenda has become so crucial for many thrilling to be a manufacturer so closely
public sector businesses across the that it is imperative to demonstrate linked with this critical sector; and to be
a source of advice, solutions and products

30

that provide an infrastructure to help
businesses achieve their sustainable
transport goals.

Nevertheless, with the speed of growth
can come mistakes and the last thing
any company wants is to be accused of
box-ticking or, even worse, greenwashing.
In our experience, companies generally
want to do the right thing. We have
designed transport solutions at VOLT for
entities of all sizes and scales. It is now a
plan with focus and momentum.

ESG aligns with the lifestyle choices
of such a significant percentage of our
population that failing to be proactive
in this arena will undoubtedly be
detrimental to businesses. How aligned
a business is with the core values of a
potential employee will and already
is influencing employment choices.
If employers don’t act on their ESG
obligations, they run the risk of staff
moving to organisations more aligned
with their ideals.

As part of a well-managed ESG policy,
it is evident that ‘Cycling as Transport’
is a highly accessible and sustainable
direction for corporations seeking
to improve their carbon footprint
and achieve their net-zero goals. By
implementing sustainable policies
around active transport, corporations
are adding substantial value to the well-
being of their employees whilst reaping
the sustainable benefits of providing and
making accessible a wholly sustainable
active transport mode.

Promoting and facilitating active
transport within an organisation sends
a powerful message to the outside
world and your employees. A two-year
research study with 4000 participants
from six major cities, including London,
concluded in 2021 that if the average city
dweller switched from car to bike for one
day per week, they would reduce their
carbon footprint by half a ton of CO2 per
year – the equivalent of a London to New
York one-way flight. If this trend were
replicated by one in five urban residents
across Europe, there would be an 8%
reduction in emissions from all car
travel.

E-bikes offer a compelling, affordable
and accessible carbon-reducing, fitness-
enhancing transport solution to support
your ESG policies and staff wellbeing.
With multiple buying solutions, tax-
free options for employees, government
subsidies for businesses, short-term
rental options, and fully inclusive service
and maintenance packages, we’re now in
the midst of a corporate and public sector
behavioural shift transforming how
people transport themselves. Now is the
time to add e-bikes to your ESG policy.

James Metcalfe

31

A NEW ‘GOLDEN SOURCE’
FOR ENVIRONMENTAL AND
SOCIAL GOVERNANCE (ESG)

DATA WILL HELP LISTED
FIRMS DECIDE WHERE
THEY PUT THEIR MONEY,
AND EVEN WHAT THEIR

VALUES SHOULD BE.

Nina Spencer, Founder & CEO Addidat

Nina Spencersaw a up after speaking with business chiefs Being able to build
gap in the market for and “having the same conversations” and that historic data set a
a more crystallised “raising the same questions” time and year on year” will help
form of ESG data again. Board members, she says, “don't
after more than know what or how to prioritise” with clients view trends.  
15-years sitting on their ESG goals - but holds the answer.
company boards and
navigating a morass of conflicting data  But how does it work?
sets which all told a different story.  Whether deciding strategy on
sustainability and being green, or the
Her new analytics and benchmarking gender pay gap and modern slavery
database, Addidat, looks to “arm the statements, Addidat shows firms “what
leaders of businesses” with valuable - is happening in whatever kind of
and reliable - information on their ESG dimension of the market” a company
footprint, which they can then use to is looking at. It also benchmarks firms’
inform where they put their cash. “against all of the other organisations
listed on [London’s AIM market] that are
 But the inception has not been a in the industry sector,” Spencer says.
straightforward one. The idea cropped

32

Using its own AI system, Addidat hoovers but we don't know whether they're going of people.. with a really deep passion
up live information on everything from to be the ones tomorrow”. about wanting the company to be carbon
annual and sustainability reports to neutral by 2030” for example.
contracts and board information on ESG needs are “evolving so quickly”,
company websites. she said, the real “power of the data will “So suddenly, this thing goes up to
be to enable organisations to unlock a leadership forums, and it’s like ‘someone
The data is pulled “into a single much clearer view of what it is they're said we need to think about being carbon
golden source”, she says, and because trying to do and how.” neutral by 2030’. That kind of statement
it’s freely available, there is “no market is just thrown out there”.
sensitive data” or figures that are  Indeed, Nina’s comments come as
“dependent on interpretation”. shareholders and investors demand “But no one can give them any
robust data sets to back up wide-ranging context” about what others are doing or
As companies release more ESG claims. what being carbon neutral would involve,
information, this ‘golden source’ is or what international targets are.
updated automatically. There lies  Some 88 per cent of asset owners What role does Addidat have in the
Adidat’s potential she argues - over time globally now say ESG reporting and future though?
the product “will only become of more disclosure is a top priority when
value”. selecting their investments - but just 39 Nina says even if investors look at
per cent of managers said they offered it, Bloomberg or Reuters, information about
“Being able to build that historic data according to a report from the Morgan ESG can be “patchy” and sporadic.
set year on year will help clients view Stanley Institute for Sustainable
trends”, She says. Investing. In collating all the available
information, she is looking to “arm the
 One goal of Addidat is to help firms In some companies, she said ESG leaders of businesses with really valuable
“avoid wasting money on investing in remains a “kind of guesswork” whereby information and data”.
ESG” goals which might be here today, there “might be one person or one team
It’s not only firms themselves
which would benefit from having a
clearer picture on ESG, however. She
says there are three drivers for meeting
environmental and social governance
goals, namely regulatory, investors and
employee needs.

There is now “an intrinsic hygiene
factor” when it comes to ESG, so that
an organisation, investment fund or
investor is “not going to fail” ethical
requirements.

“It’s not greenwashing”, she said. “It’s
datasets.”

Investors are the biggest driver, and
“even in this tough market, I don’t think
we're going to forget to worry about the
environment”.

Asked if Addidat is effectively acting
as a regular might do, shining a light
on companies’ ESG shortcomings, she
agrees. Spencer wants to go to companies
and “tell them really effectively and
quickly.. the gaps” in their targets.

Looking to the future however, she
said “I don't want to become a regulator.
But I think increasing the regulatory
requirements for organisations will be
key, and it will happen.

“This will help facilitate those
conversations.”

33

BLOCKCHAIN HELPING CLIMATE
IMPACTED COMMUNITIES

by Jack Mendel

Dr Jane Thomason spent through beneficiaries like the banks, where it's undeniable that there's a
a lifetime working who take a significant percentage of the benefit” of using the technology and
across the globe in climate funds. So it means more funds “people need help”. “When Afghanistan
international health are available for climate action,” she says. blew up and everyone was trying to
care in emerging escape, no one could get money. And
economies,  and now Another benefit of using blockchain so the crypto community got together,
thinks Blockchain can in climate action comes through and then they started being able to send
be the solution to many of the problems tokenization of climate offsets or money to people to buy food and blankets
she experienced. carbon credits, especially in developing [and help] them escape the country.”
countries. 
From energy consumption, Blockchain is not however a
humanitarian disasters, to  poor Distributed green energy, such as the technology without its risks and
access to quick finance, the “incredibly Brooklyn Microgrid or Power Ledger, is faults.  “We have to be careful with
powerful and transformative”  tool cuts another area Thomason says blockchain technology because it creates new
out a middle man, making basic things is ripe to disrupt. “People are able to environmental footprint and E waste
accessible to anyone with a mobile produce renewable energy through a that needs to be dealt with.
phone.   solar panel, even in a remote village, and
then redistribute that energy to other “We can't pretend that it's free” and
While the technology is complicated, people.So I could have a solar panel in will “just be an environmental success.”
she breaks it down in the simplest terms Africa for example and I could sell small
possible, saying “it's a database with no amounts of solar for someone to charge "There is reason to be optimistic
central point of control, so it's distributed their mobile phone or for someone to about the ability of technology to help
and decentralised”. charge a solar light and then they can achieve  the sustainability goals, 70%
receive micro-payments”. of which could be accelerated with
“It allows people to exchange technology. Now with the advances on
information and value”, like money Asked whether removing that middle Blockchain with NFTs as digital receipts,
or credits, “on a peer-to-peer basis man, might  make them more vulnerable, gamification which can incentivise
transparently and immediately she says “No. And that's the point about climate action, tokenization of carbon
and efficiently”, thereby cutting out blockchain. It's completely transparent.” credits, Web 3.0, the internet of value,
intermediaries. Banks under threat? and the Metaverse which will be able
to transport people into an immersive
This is important, in countries where Thomason says of Blockchain in journey  to climate impacted areas, we
people might not have immediate access supply chains, “It brings trust and can see how all these technologies can be
to banking institutions or instant transparency as well as the efficiency deployed to accelerate climate action.  We
finance.  and the significant reduction in cost, recently  launched the World Metaverse
 What is Blockchain, though? because all the middleman is doing is Council, which will have a whole vertical
taking money, and then passing it on to devoted to Metaverse and Sustainability,
The technology may be complicated, someone else.” to help educate and inform people on
but she says it doesn’t really matter if hoe technology is an essential tool for
people understand it or not.  But has there been any resistance to sustainability."
this trend from banks? 
“I never start by explaining Dr Jane Thomason
blockchain, the technology. Where I start “Absolutely” she says. “You expect International ESG Campaigner
is explaining what it can do for you - or that in financial services. A significant (Chair, Kasei Holdings, London)
what you  can do in a given circumstance majority of banks are spending money
- with it.” on both researching Blockchain and
actually having a look at how they can
She compares it to another deploy it to make their settlement times
revolutionary technology: “It's a bit like quicker and more efficient . “They see
trying to explain the internet. I have no what the technology brings.  There's
clue how that works but I know what I absolutely resistance. But especially
can do with it. in financial sector they're just going,
‘okay how can we come together with
“No one's going to understand  the this technology and figure out how to
technology, and they don't need to”. use it to our benefit’.” She argues banks
 How it is transforming the world are already getting in on the act, “They
already are”, she says. “Some have even
 Thomason gives examples, including “bought fintech companies that enable
improving “the flows of climate funds”, them to use it. The ones that don't [adapt]
because blockchain can “transparently will probably struggle in the future.”
and efficiently improve” transfer of cash Helping those in crisis 
“right from where they're being given to
the beneficiaries - even to the point of Thomason also reflected on “settings
climate impacted communities.”

This can be done “without travelling

34

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