Experts in impact and responsibe investment debate about the future of "finances for good"
By Caio Miranda
The 2nd Finance for Good Seminar: the State of the Art, sponsored by SITAWI, was held on June 12, 2019, in São Paulo. The event attracted national and international experts who shared their experiences about Impact Investment and Responsible Investment.
In all, 283 guests circulated in the spaces of the Unibes Cultural, during a day full of free programming, networking and learning more about Finance for Good. The event was supported by the Institute for Climate and Society (iCS), the Humanize Institute, and by the Partners for the Amazon (PPA). To see the photos of the event, click here.
There were ten sessions, including panels and plenary sessions, which covered subjects such as Social Impact Bonds, Green Bonds, Socio-environmental Risk, Innovative Financial Mechanisms, Philanthropic Funds, ESG Integration, as well as Climate Change and Investment in the Amazon.
The first plenary session of the Seminar, "Is Blended the New Finance?", debated the different types of capital to achieve the Sustainable Development Goals (SDG) and involved Rodrigo Ordenes, Senior Investment Officer at ResponsAbility, Fabio Deboni, Executive-Manager at the Sabin Institute, Eliane Lustosa de Andrade, Director of Investment at BNDES, and Leonardo Letelier, CEO at SITAWI, as moderator.
To end the debate, SITAWI Finance for Good, with the support of the Sabin Institute, launched a Platform of Collective Lending, which allows individuals and organizations to invest directly in positive socio-environmental impact businesses.
There were then two simultaneous panels: one about Social Impact Bonds (SIB) in Latin America, and the other about Trends of ESG integration in fixed income and bank credit.
To discuss SIB, we invited Maria Laura Tinelli, Director at Acrux Partners, Adolfo Díaz, Chief of Staff, at the Ministry of Urban Development and Transport of Buenos Aires, Daniel Uribe, Deputy Technical Director at the Fundación Corona, and Marta Garcia, Director at Social Finance UK. At the end of the panel, the Latin American Network of Social Impact Bonds was announced, which is formed of 11 intermediary organizations from countries of Latin America, and has the objective to put into practice this new mechanism. The Program to Promote the Structure and External Evaluation of Green Bonds (PEAX) was also disclosed, which aims to promote pioneering issues of Green Bonds with high climate additionality. Click here for more details.
Groups of investors are increasingly beginning to consider environmental and social issues in their investment portfolios. In addition to profitability, the concern with climate change, due to the high emission of carbon gas into the atmosphere, leads the investor to also analyze the efficient and sustainable use of natural resources by companies. To better understand the topic, we invited experts on the subject to our second plenary session of the Seminar. Carlos Takahashi, Managing Director & Country Head Brazil at BlackRock, João Lampreia, Senior Manager at the Carbon Trust, Daniel Ricas, Senior Technical Consultant at GIZ, and Gustavo Pimentel, Director at SITAWI, participated in the session "Climate Change: Decarbonizing portfolios to invest in climate solutions." The plenary session discussed the different options to evaluate how investment portfolios affect the climate and to reduce the impacts of these investments, and how the climate affects investment portfolios and how to mitigate these risks.
"Financial institutions, institutional investors and companies are increasingly aware of the need to evaluate the impacts of their actions on the climate and the climate risks that affect their investments. The reasons for doing this are many, from assuring the longevity and prosperity of their business, responding to the demands of investors or consumers, and even by contributing with sectoral or global commitments such as the Paris Agreement. It is excellent to see this discussion taking shape in Brazil," said João Lampreia.
"This is an expanding agenda, and it is up to Brazil to position itself to take a leading role or as an observer," concluded Daniel Ricas.
Investors for the Climate
At the end, Investors for the Climate (IPC) was launched, which has the objective to engage and persuade professional investors from Brazil to make progress in the decarbonization of their portfolios, contributing to the achievement of the Brazilian targets in the Paris Agreement. The IPC has the technical coordination and executive secretariat of SITAWI, and is supported by the Institute for Climate and Society. The initiative will promote a dialogue group about decarbonization, and the creation of tools to encourage decarbonization, the disclosure of the subject in the specialized media, and advocacy for the insertion of the issue into the agenda of the market.
Soon after the second plenary session, the meeting was followed by two panels: "Turbocharged philanthropy for the challenges of the twenty-first century" and "Sustainability in the pocket and in the stock exchange: how are companies and investors transforming ESG into money?" In the first panel, Luciane Gorgulho, Head of the Department of Education and Culture at BNDES, Roland Widmer, Manager of Programs and Funds at SITAWI, Augusto Corrêa, Executive Director at the +Unidos Group, and Graciela Selaimen, Program Coordinator at the Ford Foundation, participated to discuss experiences where the combination of financial instruments maximized the positive socio-environmental impact of the projects.
In this case, philanthropy was associated with other mechanisms to generate impact, thereby boosting it. Luciane commented on the initiative to support cultural heritage from the combination of collective financing with matching funds. In turn, Graciela commented on the creation of philanthropic funds in order to leverage strategic social fields. Complementing the discussion, Roland highlighted the Médio Juruá Territory, where donations from different economic agents were combined to catalyze the local development.
In the second panel, the discussion was about approaches for the creation of value through ESG integration from the point of view of liquid assets (equity and credit), and private and corporate equity. The panel included the experts Julio Ramundo, Director of Corporate Finance at Suzano, Natalia Galarti, COO/E&S Officer at Crescera Investimentos, Christopher Alves, Chief Analyst at SITAWI, and Fabio Guido, Manager of Institutional Relations at CEBDS.
Two panels then wound up the meeting. One was about investment in the Amazon and the other on regulatory evolution and socio-environmental impact. The panel "Investing in the Amazon: One size does not fit all" debated the need to promote the development of a sustainable economy with the adoption of economic practices with a greater productivity by unit of area, which is capable of sustaining the local population at a higher level of income and with less environmental impact. This requires the development and implementation of an investment ecosystem, involving entrepreneurs, donors and impact investors. This panel included the experts Mariano Cenamo, Director of New Business at IDESAM/PPA, Joanna Martins, CEO at Manioca, Georgia Pessoa, CEO at the Humanize Institute, and Nick Oakes, Director of Investments at Althelia Funds. At the end, the 2nd PPA Business Call was announced, which seeks to support businesses and impact entrepreneurs that are generating and strengthening a new economy, based on the conservation of natural resources and in the appreciation of the socio-biodiversity of the Amazon. Learn more here.
At the same time, the panel "Conviction, Convenience, Compliance? Regulatory evolution and socio-environmental impact in different asset classes," took place in the theater, which included Luis Stancato, Coordinator in the inspection area at the Central Bank of Brazil, Cláudio Maes, Manager of Development of Rules at CVM, Élida Almeida, Coordinator of Financial Systems at the Sub-Secretariat for Microeconomic Policies and Financing of the Infrastructure of the Secretariat for Economic Policy of the Ministry of Economy, and Guilherme Teixeira, Senior Consultant at SITAWI, as the moderator of the debate. To close the panel, it was announced that SITAWI is part of the implementing consortium of the UK Prosperity Fund Green Finance Programme.
SITAWI Collective Loan platform
With support from the Sabin Institute, SITAWI launched a Collective Loan Platform during the Seminar that allows individuals and organizations to invest directly in positive socio-environmental impact businesses. The initiative, which increases the access to impact investment in Brazil, expects to mobilize US$ 1.5 million, multiplying the invested capital and the generated positive impact.
The platform is on air at the address www.emprestimocoletivo.net. In it, those interested can research the profile, the impact, and the financial projections of 5 impact businesses selected by SITAWI and invest in their choice, with amounts from R$ 1,000. The impact businesses will use the money to leverage their operations and will pay interest of 1% per month for the loan.
"SITAWI is taking a large step, not only to reduce barriers so that more people can make impact investments and for the resource to become more abundant for businesses, but also in transforming the way each one deals with the power of money. By launching the platform at the Seminar, with the partners present and with significant uptake on the first day of the launch, it demonstrates that we are progressing with a powerful network in which, together, we can transform our reality."
The Finance for Good Seminar: the State of the Art will have its third edition in 2021. In order not to miss any news until then, follow Sitawi on Facebook, LinkedIn and the web series on the YouTube channel.