Tuesday, December 24th - 2024

Author: Sam Rubinstein

Your weekly guide to Sustainable Investment

TBLI's Christmas Greetings 2024


 


 

Meet the Changemakers: Join the TBLI Mixer this week

🗓 Date: Dec. 27th

⏰ Time: 16:00 CET

 

Join Us for an Extraordinary Networking Experience: TBLI Virtual Mixer.

 
Free to attend - no charge.
 
Imagine a networking event where you don’t have to sell anything – just be yourself.

Through our TBLI virtual mixers, we’ve reimagined how professionals can connect. This is where people who care deeply about sustainability, impact, and creating real change come together. Meet non-extractive, authentic eccentrics – people from diverse industries who think beyond the ordinary and act for a better world.

The conversation flows, the connections are meaningful, and every participant brings something unique to the table.
 
 Register Here

Why Share This Event? Whether you’re looking to build partnerships, share your ideas with new minds, or simply want to meet people who get it – this is where you want to be. TBLI Mixers don’t just create connections, they spark movements. So share this with your network, and help create a world where real connections lead to real impact. Let’s redefine networking – together!

 

"Wealth Management's Dark Secret: How Information Manipulation Erodes Family Office Returns

By: Robert Rubinstein

Wealth management operates within a complex ecosystem where information is power. For family offices, access to reliable, timely, and actionable data is the cornerstone of sound investment decision-making. Yet, systemic opacity and deliberate information manipulation by intermediaries—private bankers, external advisors, venture capitalists, and private equity firms—create significant barriers. These barriers undermine efficiency, limit access to high-quality opportunities, and diminish the long-term financial performance of family offices.

This editorial delves into the mechanisms of information manipulation, its impacts, and actionable strategies that family offices can adopt to counteract these entrenched practices.

Family offices wield immense financial power in the rarefied world of wealth management, where billion-dollar decisions are routine. They represent a unique nexus of capital, legacy, and purpose, often serving as stewards of generational wealth. Yet, despite their influence, family offices find themselves navigating a financial landscape riddled with deliberate obfuscation and information manipulation, perpetuated by the very intermediaries they rely on—private bankers, external advisors, venture capitalists, and private equity firms.

At its core, wealth management is supposed to serve the interests of its clients. Yet, the system is structurally designed to prioritize intermediaries' profits over transparency and alignment with family offices’ goals. The result? Lost opportunities, suboptimal investments, and inefficiencies cost family offices billions each year in lost opportunities and poor overview of the market.

This dynamic is widespread in Sustainable Investing (ESG and Impact Investing) across public and private markets, encompassing funds, direct deals, fund of funds, and industrial holdings. Wealth managers and intermediaries often claim their clients lack interest in achieving both Alpha and restoring social and environmental balance. However, when speaking directly to asset owners, a different reality emerges.

Clients are frequently told there are no viable deals, the risks are too high, or management is insufficiently skilled. Meanwhile, wealth managers promote the myth that their non-ESG investments consistently outperform benchmarks, with PE funds delivering 30% ROI and hedge funds exceeding 30% returns—claims that strain credibility.

In truth, many wealth managers rarely venture beyond their narrow, familiar networks, nor do they offer products that align with sustainable investment objectives. In some instances, they even argue that offering ESG products would reduce their fees—a baseless excuse to justify inaction and maintain the status quo.

This systemic opacity is not an accident. It is a carefully curated feature of wealth management, driven by structural incentives that reward intermediaries for controlling access to information, creating artificial barriers to entry, and keeping family offices in the dark.

The Structural Incentive for Opacity

Intermediaries within wealth management are not simply passive conduits for deal flow. Instead, they are active gatekeepers, incentivized to control information and access for their benefit. This strategic opacity enables them to secure higher commissions, maintain competitive advantage, and prioritize opportunities that serve their immediate networks.

Read full article 

Three-quarters of the world’s land is drying out, ‘redefining life on Earth’

Two workers plant a sapling
 

By: Ayurella Horn-Muller - Grist.org

Climate change has made great swaths of the planet drier and soils saltier, jeopardizing food production and water access for billions.

As Earth grows warmer, its ground is becoming drier and saltier, with profound consequences for the planet’s 8 billion inhabitants — nearly a third of whom already live in places where water is increasingly scarce and the ability to raise crops and livestock is increasingly difficult. 

Climate change is accelerating this trend. New research has found global warming has made 77 percent of the Earth’s land drier over the past three decades while rapidly increasing the proportion of excessively salty soils. 

Drylands, or arid areas where water is hard to come by, now make up more than 40 percent of the planet (excluding Antarctica), a likely permanent consequence of climate change, according to a landmark report by the United Nations Convention to Combat Desertification, or UNCCD. Another new analysis, by the Food and Agriculture Organization of the United Nations, or FAO, found that roughly 10 percent of the world’s soils are affected by excess salt, with another 2.5 billion acres at risk.

These interwoven trends threaten agricultural productivity, biodiversity, and ecosystem health while exacerbating food and water insecurity. Together, the two reports sound an urgent alarm: Unless the world curbs emissions, these shifts will continue, with grave implications. 

“Without concerted efforts, billions face a future marked by hunger, displacement, and economic decline,” said Nichole Barger, an aridlands ecologist who works with the UNCCD. 

Some 7.6 percent of the planet’s land was remade by climate change between 1990 and 2020, with most of the impacted areas shifting from humid landscapes to drylands — defined as an area where 90 percent of rainfall evaporates before reaching the ground. Together, they cover a geographic expanse larger than Canada, researchers found, and in 2020 were home to about 30 percent of the world’s population. That’s a jump of more than 7 percent in recent decades. Unless the world sharply limits emissions, that proportion could more than double by the end of the century. By that point, more than two-thirds of land worldwide, with the exception of Greenland and Antarctica, is expected to store less water.

These changes are not limited to regions already considered dry, or expected to experience desertification. When modeling global high-emissions scenarios, the researchers found similar changes could occur in the Midwest, central Mexico, and the Mediterranean, to name three examples. The researchers have no expectation that this trend will reverse. 

What Hannah Waterhouse, a soil and water scientist at the University of California, Santa Cruz, finds “important, and unnerving to emphasize” is that this expansion occurred under conditions that aren’t nearly as hot as what’s to come. That suggests the problem will only escalate and, as food and water grow more scarce, usher in issues like widespread conflict, she said.

“We can look to current geopolitical and ecological events that are playing out currently to understand what we can expect in the future,” Waterhouse said. “Think of what is occurring in Sudan right now, where climate change is exacerbating resource scarcity, which is interacting in governance and geopolitics in violent outcomes for civilians.” 

Aridity is not to be confused with drought. Drought is best described as a sudden and startling, but temporary, water shortage often caused by low precipitation, high temperatures, little humidity, and unusual wind patterns. Arid regions, on the other hand, experience persistent, long-term climatic conditions in which evaporation exceeds rainfall, creating conditions in which it can be difficult to sustain life. It is much more subtle than a drought, but no less significant.


Read full article 

Localization Through Leadership

Black woman and white woman talking to one another on a stage

By Sylvia K. Ilahuka 

One of the latest trends in the development world is leadership localization, a term that describes a usually Western funder’s effort to shift power to usually non-Western local communities, and thus create a more meaningful presence in the countries where their grantees implement programs.

Done well, the benefits of localization are many. For one, it’s easier to serve a local community when senior leadership is nearby and in tune with local issues. It also facilitates team involvement in planning and strategizing, often speeding up decision-making processes and imparting a greater sense of ownership among staff. Time differences become less problematic, especially when urgent matters arise, and it often eases collaboration with local governments due to in-person contact and contextual familiarity. Working with a leader who has a similar or at least more-relatable background can also boost staff morale and confidence.

However, while more and more organizations are shifting leadership in this direction, especially on the African continent, the discourse has tended to focus more on the why than the how. The argument for the adoption of many novel concepts tends to come first and the best practices second, so this isn’t surprising. But because localization risks appearing—and sometimes ends up being—disingenuous, organizations must understand how to do it in ways that won’t undermine their work or generate distrust from the communities with whom they engage.

Segal Family Foundation, a trust-based funder focused on social justice in Africa, has approached leadership this way for more than a decade. We’ve seen several organizations originally founded and led by non-Africans evolve toward local leadership, and our own grantmaking team is entirely African, based in Africa, and supporting African-led organizations. We recently sat down with some of these leaders, old and new, to dig into what made their transition to localized leadership work.

Four Strategies for Localizing Leadership

The most important ingredients for a smooth handover, especially for organizations transitioning from foreign to local leadership, are preparation and transparency. In the case of our grantee Komera, a young women’s empowerment organization based in Rwanda, Canadian founder Margaret Butler made it clear from the start that she intended to hand the organization over to an African woman and entirely local staff. When Butler decided to step aside in 2020, a decade after Komera’s founding, the news was received well by the team, and Dativah Bideri, a Rwandan woman, assumed leadership within a year.

But it doesn’t always happen that way; the need for localized leadership often emerges later in an organization’s lifecycle. This was the case with Resonate Workshops, a leadership development organization for girls and women across East Africa. Two years after its founding, Ayla Schlosser began planning to transition her executive director position to a local leader. This decision followed the departure of Rwandan co-founder Solange Imapanoyimana, after which Schlosser realized it didn’t make sense for a white American woman to be running an organization that works to empower Black African women.

Read full article 

What went right in 2024: the top 25 good news stories of the year

Image for What went right in 2024: the top 25 good news stories of the year

 

Words by: Gavin Haines

There were ‘mind-blowing’ medical advances, species came back from the brink, renewables defied naysayers, cities became more liveable, and scientists showed how to slow time, plus more good news

The 2024 good news roundup

1. EU emissions shrank (and China’s ‘may have peaked’)

While the climate crisis came into ever sharper focus in 2024, emissions continued to rise – but not everywhere. 

Data published in October revealed that emissions in the European Union (EU) plummeted by 8% in 2023, meaning greenhouse gas pollution in the bloc is now 37% below 1990 levels. The closure of coal-fired power stations and rapid rollout of renewables drove the decline.  

EU nations have committed to cutting emissions by 55% this decade, compared to 1990 levels. The European Environment Agency estimates that current policies would see it fall short with a below-target 43% reduction.

Still, the direction of travel is clear. The International Energy Agency reported that emissions in advanced economies dropped to a 50-year low in 2023. Experts are also increasingly optimistic that China – the world’s biggest polluter – may have reached peak emissions. 

2. Not even a ‘greenlash’ could stall surging renewables

A poor show for green parties in the EU elections and incoming US president Donald Trump’s promise to “drill, baby, drill” could not take the wind out the sails of the green energy revolution in 2024, which was led by China.

China is currently building almost twice as much wind and solar as the rest of the world combined, data from July showed. The rest of the world is playing catch-up. Separate research found that most global south countries have entered the “sweet spot” of green energy, whereby the falling cost of renewables triggers a cleantech “revolution”.

Europe’s electricity grid, meanwhile, decarbonised at record pace, and the new UK government put the country back at the sharp end of the energy revolution. It became the first advanced economy to quit coal in October and is on course to decarbonise its electricity grid by 2030.

“The narrative that we’ve seen around renewables – that they’re unreliable and expensive – isn’t being borne out in the facts,” said Frankie Mayo, lead UK analyst at the energy thinktank Ember. “Renewables are cheaper than coal and gas. We’re seeing a global picture of [countries] edging towards wind and solar.”

3. The green economy defied sceptics

Net zero sceptics like to claim that going green is a drag on the economy, but that line sounded hollower than ever in 2024.

In February, number crunchers at Carbon Brief, a climate reporting website, found that China’s low-carbon energy sector – including renewables, battery storage and electric vehicles (EVs) – was the main driver of economic growth in 2023, accounting for 40% of China’s GDP expansion.

Meanwhile, a separate report revealed that while the UK economy grew by just 0.1% in 2023, its burgeoning ‘net zero economy’ grew by 9% over the same period. What’s more, green jobs were found to be better paid, with the average ‘net zero salary’ coming in at £44,600, compared to the UK average of £35,400.

“Against the backdrop of economic stagnation, the net zero economy is bucking the trend,” said Peter Chalkley, director of the Energy and Climate Intelligence Unit.

Read full article 

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El Salvador overturns metals mining ban, defying environmental groups

People in Congress hold up signs that say "No Mineria"
 
Reuters in San Salvador

President Nayib Bukele pushed for the legislation that will grant government sole authority over mining activities.

El Salvador’s legislature has overturned a seven-year-old ban on metals mining, a move that the country’s authoritarian president, Nayib Bukele, had pushed for to boost economic growth, but that environmental groups had opposed.

El Salvador became the first country in the world to ban all forms of metals mining in 2017. Bukele, who took office in 2019, has called the ban absurd.

All 57 of Bukele’s allies in the Central American country’s 60-seat legislature voted for the president’s legislation to overturn the ban.

The legislation will grant the Salvadorian government sole authority over mining activities within the country’s land and maritime territory.

“By creating a law that puts the state at the center, we are guaranteeing that the population’s wellbeing will be at the center of decision making,” the lawmaker Elisa Rosales, from Bukele’s New Ideas party, said in a speech to the legislature.

The legislation does prohibit the use of mercury in mining, and seeks to declare some areas incompatible with metals mining as protected nature reserves.

El Salvador’s economy is expected to grow 3% this year, according to the International Monetary Fund, but it has a heavy debt burden that hit a level of about 85% of gross domestic product earlier this year.

Bukele, who enjoys wide popularity among voters after a sweeping gang crackdown, has touted mining’s economic potential for the country of roughly 6 million people.

By locking up more than 1% of the population, Bukele has turned one of Latin America’s most violent countries into one of its safest – but human rights organisations have documented arbitrary arrests, enforced disappearances, torture and massive violations of due process.

The president shared on social media last month that studies conducted in just 4% of Salvadorian territory where mining is possible had identified gold deposits worth some $132bn, equivalent to about 380% of El Salvador’s gross domestic product.

“This wealth, given by God, can be harnessed responsibly to bring unprecedented economic and social development to our people,” Bukele wrote at the time.

Dozens of people protested on Monday near Congress against the reauthorization of mining, arguing that future projects could affect the communities and ecosystem of the smallest country in Central America.

“We oppose metals mining because it has been technically and scientifically proven that mining is not viable in the country,” the environmentalist Luis González told reporters.

“The level of contamination that would be generated in the water, soil and biodiversity is unacceptable for life as we know it.”

Source

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