Major corporations are betting heavily on sustainability. Apple just?doubled?to $400 million its climate fund — one dedicated to saving ecosystems and removing carbon from the air. Earlier this year, BP said it would significantly increase by as much as?$8 billion?investments in alternative energy solutions. Meanwhile, fashion retailers like H&M Group, Lululemon, Chanel, Ralph Lauren, and others continue to?plough money?into sustainable innovations.??
Some companies are boosting investments to better offset (or reduce) their own environmental impacts. Unilever, for example, is using its €1 billion climate and nature?fund?to help achieve net zero by 2039, amongst?other sustainability goals. Others invest to scope out opportunities. GV, formerly known as Google Ventures, has over $8 billion in assets under management across 400 investees?with technologies ranging from electric delivery drones to meatless meat. So far, GV has acquired?175?of its portfolio companies.
Sustainable investing worldwide is booming. ESG-mandated assets[1]?are on?track to represent?half?of all professionally managed?assets globally?by 2024, predicts?Deloitte. In early 2020 the value of sustainable investment in?major financial markets globally stood at?$35.3 trillion?— a 15% increase from 2018 — and?accounted for?36%?of all professionally managed?assets across the US, Canada, Japan, Australasia and?Europe.?
- Apple’s Restore Fund is investing $400 million to protect ecosystems and remove carbon emissions from the atmosphere. With this fund, Apple aims to meet its net zero goals while generating a financial return. The Chyulu Hills project, for example, is a forest restoration initiative in Kenya which removed?167,000 metric tonnes?of carbon from the air in 2021. Further nature restoration projects in Brazil and Paraguay are expected to remove?1 million metric tonnes?of carbon per year by 2025, to be measured?by remote sensing technologies and high-resolution satellite imagery.
- Coca-Cola HBC Ventures ran a €100K sustainable packaging?challenge?to identify and fund innovative solutions in 2022. The venture focusses on sustainable packaging and carbon reduction to achieve Coca-Cola HBC’s goals on waste reduction, water use and net zero emissions. The challenge was explicitly run to help the company solve its critical packaging issue. The winner was Green Big, a French startup that has collected and recycled?100 million?plastic bottles through b:bot, a machine that turns plastic into flakes.?90%?turn into new bottles and 10% become textile fibres.??
- BP’s VC arm bp ventures just invested?$11 million?in electric delivery vehicles in India, a key market for the company’s electrification business. The fund has invested over?$1 billion?since its launch, focussing heavily on energy transition to help BP reach its net zero goals while delivering financial value. The investment in low carbon technologies comprised?30%?of the parent company’s total investment in 2022, up from around 3% in 2019. It plans for additional investments of up to $16 billion by 2030, to be divided equally between alternative energy solutions and oil and gas.?
- H&M Group’s investment arm?H&M CO:LAB?has ramped up its investments in sustainable materials, including fibres made from cotton waste and polyester from waste carbon dioxide. It aims to support H&M Group’s long-term growth by investing in solutions that help the company reach its circularity and climate goals. For example, it’s using biological dyeing technology from investee?Colorifix?to reduce the environmental impacts of traditional dyeing processes, such as water use and pollution.?
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[1]?Defined here as?professionally managed assets in?which ESG issues are considered in selecting investments or shareholder resolutions are?filed on ESG issues at publicly traded companies.?
