The GLOBE 2016 Ah-Ha Moments Series: Financing The Future We Need

The Paris Agreement makes it plain: We need to change the world, and fast.

Our cities and communities—and the systems that power, connect, and supply them with essential services—desperately need a 21st-century overhaul.

We’ll need to replace a great deal of existing outdated infrastructure with smart, innovative, intelligent systems. These systems will produce far less carbon and not only anticipate climate-related impacts, but also bounce back from them—and even “learn” from them. Cities will need to accommodate more people, while improving quality of life for residents. And they’ll need to be connected via efficient, comfortable, and clean transportation networks.

How will we finance this transformation? How will investment, industry, and government leaders collaborate? Which jurisdictions are already making it happen?

Those questions lie at the heart of GLOBE Capital 2017—a new leadership event offered by GLOBE Series, coming to Toronto, Canada from April 3-5, 2017.

In anticipation of GLOBE Capital 2017, we placed a special focus on finance and investment at GLOBE 2016. A variety of sessions addressed such subjects as finance innovation for scalable, global technology deployment, green economic development, financial inclusion and fiscal reform, and carbon risk.

Here, a few key observations from a pair of related sessions.

The Carbon Bubble: Managing Financial Risks of Stranded Assets

Carbon Tracker Initiative founder and executive director Mark Campanale speaks while Jackie Forrest, vice president, energy research at ARC Financial, looks on.


Recent science suggests that the lion’s share of fossil reserves must stay in the ground if the earth is to keep below two degrees of warming. How are investors and pension fund managers responding to the potential for stranded assets?

  • Carbon Tracker Initiative founder and executive director Mark Campanale said that the real risk that investors see today is not clean energy, it’s actually the fossil fuel sector.
  • At Suncor’s recent Annual General Meeting, Campanale noted that shareholders tabled a resolution requiring the company to explain how it will adjust its production forecast to remain viable in a 2C world.
  • Saudi Arabia is resisting supply cuts, noted Campanale: “They want to be the last provider of oil.” He said that the kingdom wants to see decline in new investment in shale and oil sands.
  • Oil companies could become more valuable by managing their own downsizing, getting “smaller, more focused, more disciplined,” said Campanale. They could use capital to make more money on every barrel, rather than seeking new ones.
  • The downturn has killed new investment, said Jackie Forrest, vice president for energy research at ARC Financial.
  •  Forrest cited a supply glut that could turn to supply shortfall in a few years; factors suggesting this include:
  • “Demand (for oil) is growing” despite downturn, she said. In 2015 demand was “highest in five years.” There might be 300,000 electric vehicles sold this year” Forrest said, but there will still be 100-million-plus cars and light trucks sold that are powered by oil.”
  • Even under 450 ppm CO2 constraint scenario, we will need to bring 40 million barrels per day online between now and 2040 to keep up with depletion and hold supply flat, Forrest said.
  • Forrest sees “limited stranded asset risk” over next 5-10 years. Only 10 percent of all emissions occur in oil production. She cited the ARC report, Crude Oil Investing in a Carbon Constrained World. The oil industry is not investing in new production, and that could be quite destabilizing, she said.
  •  Forrest suggested that the divestment movement is hypocritical, because it focuses only on industry and supply, and not on consumers and demand.
  • Laura Nishikawa, the head of fixed income ESG Research at MSCI said the conversation about carbon budgets is moving “from the religious to the rational,” from activist demands etc. to business mainstream planning.
  • Nishikawa sees a significant gap between what nations committed to in terms of GHG reductions at Paris, and what companies are planning for.
  • Canada has the biggest such gap of all developed nations. The question now is: “Which side of the energy transition am I going to be on?”
  • There is lots of talk about divestment, but institutional investors are embracing more moderate approaches, she said.
  • Example: Portfolio Decarbonization Coalition. 70 percent reductions in carbon exposure, 95 percent reductions in fossil fuel investments, but still perform as well as rest of the market.
  • Karen Lockridge, the Principal, Sustainability and Climate Change & Pension Actuary at Mercer admitted that, four years ago, she was personally oblivious to climate change. She’s now working on “Investing in a Time of Climate Change” report, with managers representing more than $1 trillion assets under management.
  • A 2C world might be insurable, Lockridge said, but a 4C world surely won’t be.
  • Ed Whittingham, the executive director at the Pembina Institute, said the oil majors are now asking “What is our role?” regarding energy transition.
  • Fossil fuels are still very profitable, he noted. Even very good renewable energy projects have only single-digit ROI.
  • But past certain thresholds, market conditions change dramatically, Whittingham said. He cited the example of a UC Davis study, in which traffic congestion beyond a certain threshold leads to flatline in car ownership within a city.


Finance Innovation for Scalable, Global Technology Deployment

David Berliner, co-founder and CEO of crowd financing platform CoPower.


This session explored strategies and solutions that would support a robust financial system for scalable, global technology deployment? What existing and new mechanisms can move large private sector capital from the “crowd”, as well as from large institutional investors like pension funds and sovereign wealth funds, to where it is needed in order to finance commercially viable enterprises and projects?

  • Christian Häuselmann, co-founder, Swisscleantech & Global Cleantech Cluster Association (GCCA), moderated the discussion.
  • Häuselmann’s organization launched in 2010 to bring together what is now a network of more than 50 cleantech clusters from around the world, representing more than 10,000 companies.
  • We need to attract trillions of additional investment to transition to clean energy economy, said David Berliner, co-founder and CEO of CoPower.
  • Those funds will come from pension funds, especially those that have infrastructure divisions. These fund managers need investment ready projects at scale—$100m ticket size. “Wind and solar are already there.”
  • Berliner said there are dozens of other distributed energy solutions that are ready for deployment: LEDs, geothermal, energy efficiency, heat and power, storage. They lack access to early project financing.
  • Berliner said online tech enabled platforms like his CoPower can facilitate investors—including retail, individuals, family offices, and institutions) to make loans to these project for yield returns and green impact.


The Finance Innovation for Scalable, Global Technology Deployment panel. From left to right, Samy Ben-Jaafar, Director, Private Sector Facility, Green Climate Fund, Markus Lampinen, the Founder & CEO of Crowd Valley, David Berliner CEO of CoPower, Roger Wagner, Senior Counsel, Dentons Corporate Group & Managing Director, P80 Group Foundation, Lih-Chyi Wen, Director and Research Fellow, CIER Center for Green Economy & Deputy Director, MOEA Green Trade Project Office.


  • Samy Ben-Jaafar said that while cleantech solutions seem a good bet, we need to think about how to address, systematically, the risk issues with pension funds.
  • When it comes to pension funds investing in clean energy projects, “liquidity is going to be a big issue,” said Ben-Jaafar. “We need to be bundling liquid assets. Until we find a way to do that they will sit on the sidelines.”
  • Pension funds are saying genuinely want to put their stakeholders money into clean energy and cleantech projects, but they are asking “give us something we can put the money into.”
  • Roger Wagner said it’s always been difficult to get pension funds to invest in clean energy due to a lack of diversification. If we can “fill the frame” of an infrastructure project, then more and more pension funds see infrastructure funds as a stable long term investment with relatively low risk and low potential for substitution.
  • “When you get into technology, you have a tougher time because if the tech is not as well established or required development or has risk associated with it is not going to fit the low risk model that the pension funds are seeking,” Roger Wagner said.
  • Having said that there are recent examples, the White House clean tech initiative in June, a new vehicle was promoted by the former head of the DOE’s loan guarantee program.
  • Kensington Capital managing partner John Walker, panel commentator, noted that “The pension funds like to deal with other billion dollar sized companies, they won’t even look at a project that we bring forward.”
  • Kensington takes institutional products and brings them down to individual accredited investors, high net worth, or family offices.
  • Walker said that the family offices in Canada have grown enormously in the past 20 years. “There is a lot of wealth out there that is looking for something different. And it is a matter of tapping into them the best way we can.”
  • Roger Wagner of P80 Group Foundation said that climate mitigation can be thought of as opportunity, and that adaptation is the poor brother. “Adaptation is about risk mitigation.”
  • “Standard and Poor’s and Moody’s have not built this risk into risk rating models. Cost of funding for companies that are highly exposed to climate change is being mispriced,” said Wagner.
  • “Not one central bank governor and not one managing director of one of the ratings agencies is factoring climate impact risks into their ratings. It’s conspicuously obvious that they are missing from the party. It is time we demand that they show up to the party,” said Wagner.
  • Wagner: “We need to reposition [climate] adaptation as operational risk mitigation and collectively we need to demand the presence of central bank governors and risk rating agencies today in that conversation.”
  • Kensington Capital managing partner John Walker, said the definition of accredited investor is changing. “In Canada, you need to have $250,000 in the bank to be an accredited investor, not including your house. That number has to come down.”
  • The problem with cap and trade and carbon credits, Wagner said, is that the government might change its mind down the road about how to use and invest cap and trade revenues. “Financiers hate regulatory uncertainty. If you are going to do [carbon credits], treat as a fiat, with heavy backing and regulatory rigour, or don’t do it at all.”


Here’s complete video recording of the discussion:


The GLOBE 2016 Ah-Ha Moments Series: Global Sustainability Megatrends Take the Stage

In four sessions, a slew of industry, academia, and civil society thought leaders dug into the megatrends that are driving the creation of a stronger, more equitable, and resilient world. The conversations addressed eco-asset management, food securitywater integrity, and waste reduction.

Here, we’ve compiled a few highlights:

Megatrend 1: Eco-Asset Management

emanuel_machado_with_karen_clarke_whistler Emanuel Machado, chief administrative officer, Town of Gibsons, with Karen Clarke-Whistler, chief environment officer at TD Bank Group.

Global markets value forests for their timber, oceans for their fish, and rolling hills for the ore that lies beneath. But a growing school of thought and practice assigns tangible financial value to intact, or largely intact ecosystems.

Enter eco-asset management, the emerging practice of assessing and accessing the value that comes with preserving ecosystems, rather than extracting their resources. Here, some of the key observations and learnings:

  • “Sponsorship and investment is the new conservation,” noted James Tansey, CEO of NatureBank.
  • An investment of just $5 Billion could eliminate 80 percent of global forest loss, Tansey added.
  • Richard Mattison, CEO of Trucost, cited a pivotal 1997 study which pegged the market value of the global biosphere in the range of US$16 to 54 trillion per year.
  • “These numbers are so big that they are meaningless to most.”
  • Standing timber is a liquid asset, but the ecosystem value of a forest is not, noted Tansey.
  • But: “We don’t need to monetize the full value of the forest in order for this approach to be helpful – we just need to value it ‘enough’ to slightly outdo the market.”

Richard Mattison, CEO, Trucost PLC

  • “There are many services that nature provides to its citizens, such as stormwater management and drinking water – nature does a lot of the work for those municipalities, said Emanuel Machado, chief administrative officer with the Town of Gibsons.
  • Financial planning rules currently do not allow the explicit valuing of natural capital, one panelist noted.
  • Mattison cited British Columbia’s Great Bear Rainforest: “Forest companies are being reimbursed for $10 to 15 million in lost revenue, not from not logging. In return, a much higher natural capital value is preserved.”
  • It’s a cop-out to try and claim there is no market demand for an intact ecosystem, one speaker said, because “most consumer demand is manufactured.”
  •  “It’s early days for valuing natural capital. It is better to create a rough approximation of value than to insist on a precise evaluation that doesn’t get it done.”
  • Natural capital approaches do need to be pulled into accounting procedures, but it won’t happen overnight, the panelists agreed. To change a standard takes five to 10 years, one said.
  • Before we can get leaders to adopt ecosystem valuation tools, we need to create a shift in values, in order to seed the desire to use the tools.

Megatrend 2: Food Security and Innovation

Can innovation feed the world? It’s a question that needs considering.

By 2050, our Earth’s population will crest nine billion—a 34 percent increase over today’s total. Five years ago, the UN Food and Agriculture Organization predicted that humans will by then need to produce 70 percent more food than we do today. In response, in the past year alone, investors moved some USD$2.06 billion into agricultural technology start-ups. At GLOBE 2016, a few of the leaders set the table.

From left, Brad Marchat CEO of Enterra, and FarmX CEO Sanjay Rajpoot.
From left, Brad Marchat CEO of Enterra, and FarmX CEO Sanjay Rajpoot.

  • Sanjay Rajpoot, CEO of FarmX, is helping farmers embrace technology and engineering so they save money and increase profitability.

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  •  “Scale is vital,” said Wood Turner of Agriculture Capital Management, which owns blueberry, hazelnut, and citrus farms and packing facilities in California. Going big and embracing scale allows his company to ferret out and resolve inefficiencies, he said.
  • The locavore movement allows communities to take ownership of food production, Wood Turner said. “We need passionate people on the local level, but we also need to deliver that on a scale that can feed more people.”
  • Training people how to farm and tell them to live that lifestyle is hard, said Rajpoot. Not a lot of people can do that. “Technological innovation should happen so that everyone can live that lifestyle.”
  • Meanwhile, Vancouver, B.C. based Enterra Feed is commercializing the natural process by which insects feast on food waste by “farming” black soldier fly larvae and using the wriggling critters to feed fish or poultry.
  • At Enterra, 36,000 tonnes of food waste yields 5,400 tons of larvae and 2,700 tons of fertilizer. “Insects are professional upcyclers,” said CEO Brad Marchant. “Let’s make food with food.”
  • Enterra is adding larva directly to the food chain as fish or chicken feed. Basically, protein to feed the humans (via poultry and fish) and using Larvae poop as crop fertilizer. “People may start eating insects in the near future,” he said. (Side note: See California startup, Bitty Foods).
  • Thomas Odenwald, overseas development partner with Community Markets for Conservation, or COMACO, a social enterprise working to reduce poverty in Zambia’s Luangwa Valley. It works to make farming more sustainable than poaching.
  • COMACO provides farmer support services, constructing cookstoves and beehives to keep elephants away from crops.If farmers score high on a range of indicators, COMACO buys their products, and sells the produce in Zambian markets—then plows the revenue back into the program.

Megatrend 3: Water Integrity

In this session, panelists and participants wrestled with the issues of water security and integrity, and touched on governance, innovation, and the technologies that will make a difference in securing safe, reliable access to fresh water—the most precious resource.

From left: Karen Bakker of the UBC Water Governance Program; Global Institute for Water Security director Howard Wheater; XPV Water Partners managing director John Coburn; Lindsay Bass of the U.S. Corporate Water Stewardship Initiative at WWF.
From left: Karen Bakker of the UBC Water Governance Program; Global Institute for Water Security director Howard Wheater; XPV Water Partners managing director John Coburn; Lindsay Bass of the U.S. Corporate Water Stewardship Initiative at WWF.

  • John Coburn is managing director with XPV Water Partners—an investment firm focused on high growth water, waste, and environmental businesses.
  • He asked a provocative question: “How much water do we use for ourselves, and how much do we leave for a healthy ecosystem?”
  • Coburn pointed to the vanishing Aral Sea, Pakistan in 2010, arsenic issues in Bangladesh, and floods in New York. Water connects us all, he stressed.
  • Karen Bakker directs the Water Governance Program at the University of British Columbia, and is also a Canada Research Chair. She presented an equation for water security: “Water security equals ecosystem health plus human health.”
  • Lindsay Bass leads the U.S. Corporate Water Stewardship Initiative at WWF, and she’s working to put water security on the radar of the private sector.
  • Bass: “Sixty percent of companies say water will affect business growth and profitability within five years.”
  • Baker said that in the event of a pollution incident, most work is done after the disaster has occurred. “We need to examine water security before an event occurs.”

Lindsay Bass of WWF
Lindsay Bass of WWF

  • Bass cited Levi Strauss & Co. as an example of a company that is a true water stewardship and environment champion.
  • Coburn said landscape will change dramatically in the next few decades, but few seem to understand the significance: “Canada is sleepwalking into an uncertain future. We urgently need national flood forecasting, and smarter technology for land and water management.”

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  • Bass proposed “water basin report cards” for companies, so they know what needs to be done.

Megatrend 4: Waste Prevention and the Circular Economy

Preventing waste is one of humanity’s most urgent issues, but also a powerful lever for change – with significant benefits for businesses, governments and citizens striving to boost sustainability and achieve ambitious climate goals. This session convened policymakers, business leaders, entrepreneurs, inventors and designers to talk through the current best practices in waste reduction, and advance durability, disassembly, and sharing.


The National Zero Waste Council kindly sponsored this session, Industrial Revolution 4.0 – How Waste Prevention Can Boost the Bottom Line and Drive Circular Economy Innovation. Dagmar Timmer, the managing director of strategic initiatives at One Earth Initiative kept everything running like an elegant closed-loop system. The council recorded a video of this session and made it available.

A few highlights:

  • Malcolm Brodie, the chair of the National Zero Waste Council, said that resource scarcity will ultimately drive new practices in businesses.
  • Nature has been creating a zero waste lifestyle for 3.8 billion years,” said Nicole Hagerman-Miller, managing director of Biomimicry 3.8. “Nature has been practicing the circular economy since its inception.”
  • Nadine Gudz, Director of Sustainability Strategy, at Interface: “Interface is a restorative enterprise, it seeks to do more good, and eliminate harm. This has never been a flavour of the month for us.”
  • Interface uses closed-loop processes, renewable energy, and resource-efficient transportation. Redesigning commerce: “As a global company we ask, what is our obligation to effect broader systems change as an leader in the circular economy?”
  • “Our traditional industrial systems are broken and we have an opportunity to model a new one based on more on the principles of the natural world.”
  • Gudz said Interface has saved more than $500 million in water efficiency measures alone since 1995. Interface looked to nature to eliminate carpet glues.
  • Ilse Treurnicht, CEO, MaRS Discovery District says the regulatory environment has not kept pace with the innovation. “We still have the elephant in the room of what you can do locally and the increasingly complexity of products and global supply chains. What role can we play in influencing the production of goods, particularly electronic waste that is not made here. The pace of change encourages disposability. It is a complex mix of things that can be repurposed and those that can’t.”
  •  “At heart of the innovation challenge is that it is a system level innovation challenge, no single party can own it or fix it, whether as user, producer, or waste manager,” said Treurnicht. “The only way we are going to make progress if we think about this as a system. There is a new way to convene the system and be selective about choosing interventions.”
  • “We can have lots of cute experiments, but if we are serious about addressing this we need to design system level innovations at scale.”
  • Treurnicht repeated the mantra of the circular economy: “If you make it, make it efficiently as possible. Make the material as useful as possible, and before you make it, think hard about whether you need to make it at all.”

Visit our Gallery and flickr accounts for GLOBE 2016 images and our YouTube channel for GLOBE 2016 videos.