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Acting For Climate: What Investors Can Do by Matthieu Baret

A few days ago, I decided to calculate my carbon footprint to better understand my behaviours that produce the most CO2, to adapt my habits in order to reduce my impact and to offset my carbon footprint, even though compensation can arguably never replace a proactive approach to reducing emissions. Yet when I completed the test on various websites, I realised that the calculations and results varied significantly, and that my carbon footprint could even double between websites.

Being responsible, thinking greener, cutting down on travel, changing one’s diet… All these actions can be complex on an individual level. So as an investor, I can understand that the process may be much more difficult for an entrepreneur when it must also be applied to a start-up and a team. Nevertheless, through my experience and my encounters, I realise that the vast majority of players in our society agree on these ideas, and that investing responsibly is a given. Businesses at all stages of growth realise that they are part of the problem, but that they also hold the keys to the solution. And far from downplaying environmental, social and governance (ESG) criteria with apathy or disinterest, it is more often a lack of effective and concrete tools that prevents these young businesses and founders from taking action.

However, integrating ESG matters into the definition of business models from the seed stage is of major interest for companies that are disrupting our practises and our economy, whose growth can be exponential and that, in a few years, may become leaders in their sectors and count tens of offices across the world and hundreds of employees. In the VC and Growth sector, we can identity 3 types of companies that we are investing in:

  • Those that, at the very heart of their activity, offer a green alternative (such as Back Market, Forsee Power, or Meteo Swift.)
  • Those, (and these constitute the majority), whose activity is digital and therefore whose impact is indirect. For example, through the functioning of the internet and the use of data centres or IT equipment.
  • Those whose activity generates emissions (in the tourism or travel sector for example) and for which it is particularly important to implement plans to reduce emissions.

Our portfolio companies are therefore both the problem and the solution. Faced with this paradox, at Idinvest, as at the heart of the Eurazeo Group, we have integrated ESG support just as we integrate the development of growth into our strategy. This means that in our decision-making processes, we look at the scope for an organisation’s progress and improvement from an ESG perspective. As an investor and owner of capital, we act as a catalyst across our portfolio, and our responsibility is all the more significant. We must therefore raise awareness among our stakeholders and ensure that each of them, at their own level, takes the necessary action to respond to the climate crisis that we are all facing.

I have recently joined the Leaders for Climate Action (LFCA) community to put our influence and our network to good use. It seems to me that in order to be effective, we must go beyond mere guidance and, more than anything, set a real example in terms of fighting climate change. LFCA currently brings together over 700 leaders who are all committed, like me, to reducing their carbon footprint and engaging their organisations to follow a carbon-neutral path. This is perfectly aligned with the objectives of the O+ strategy recently unveiled by Eurazeo, which aims to achieve net zero carbon by 2040 at the latest and promote a more inclusive economy, in particular by helping our portfolio companies to do the same. At Eurazeo, our ESG commitment is based on two principals: That of investing to have a positive impact on society, coupled with the conviction that responsible companies create sustainable financial and economic values.

Climate change is a systemic problem. Many people want to act, but don’t know how. But we can all reduce our carbon footprint, both in our personal lives and in our work environment. We shouldn’t be afraid to utilise our influence with our portfolio companies and with our investors, to value our successes and learn from our failures, to share our tools and knowledge, and to use our experiences to come together and build a collective response.

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