Brazil’s National Bank for Economic and Social Development (BNDES) has announced that, starting in 2023, all of the institution’s loans will require carbon accounting for invested projects. Today 11% of the world’s bonds are “green.” In the first half of this year alone, 835 green bonds were issued worldwide raising 245 billion dollars. In Brazil, Deutsche Bank announced a credit line of one billion dollars aimed at companies that commit to environmental, social and governance benchmarks. By having planning, targets and systematic monitoring of benchmarks in socio-environmental matters, companies can access an increasingly wider niche of resources, consolidating this agenda as a business strategy.
Brands and Causes
Our Vision: The restaurant industry is embedded in the world of two extremely critical sustainability factors – food insecurity and carbon emissions from agriculture and cattle-raising. Brands that develop initiatives aimed directly at customers around these factor help to educate, raise awareness and, most importantly, render this audience part of the transformation.
Our Reading List: BK Brazil, which manages Burger King and Popeyes restaurants, raised R$4 million with customer donations that went to 15 non-governmental organizations. Arco Dorados, which operates the McDonald’s chain in 20 countries in Latin America and the Caribbean, has launched its new campaign for toys produced with sustainable materials. Among more bold sector actions is the inclusion of carbon footprint information of specific dishes on menus and food labels, which consumers have shown to support.
Unilever, Nestlé and NatWest Group lead the ranking of the 100 companies that best disclose information on environmental, social and governance practices (ESG). System B, which certifies companies for their emissions, also released a global list of companies with the best practices.
Sustainable Finance
Our Vision: The transition to a low carbon economy requires companies to find innovative solutions that, many times, cannot be developed internally. Partnerships with technology startups emerge as an alternative, bringing together highly intellectual capital and the needed agility to respond to different issues.
Our Reading List: More than half of 255 major Brazilian companies interviewed by Grant Thornton intend to invest in ESG, with 32% interested in making investments through startups. In the first half of 2022, Climate Tech Startups raised approximately $19 billion in 500 venture deals. Last year, a total of $40 billion was invested in climate tech startups. Suzano, the world’s largest producer of eucalyptus pulp, created a $70 million line of credit for bioeconomy startups.
Corporate Sustainability
Our Vision: Conducting carbon emissions inventory alone is not enough to reach the net zero commitment, and one of the main criticisms is the absence of effective decarbonization plans. There is a need to create a collection and monitoring system. Integrating a data culture into environmental strategies ensures information traceability, accessibility by decision makers, and problem visualization from different perspectives.
Our Reading List: Google has developed a tool to help companies be more sustainable and Salesforce has created the Net Zero Cloud platform for comprehensive emissions data management. The non-profit organization OS Climate has launched free tools to support climate change decisions and target investments. The software, supported by BNP Paribas, Allianz, and Airbus, helps identify and quantify risk, align investment portfolios, and enable modeling, testing, and scenario analysis for strategic climate-aligned decisions.
Deep Dive
The book Purpose and Profit: How Business Can Lift Up the World by George Serafeim is a roadmap for people at all career stages to understand how the world is changing and how organizations can produce better results while designing profitable and scalable solutions. McKinsey points to ten families of climate technologies considered critical to meeting the net-zero challenge.