invert logo

Invert Insights October 6, 2023

Companies are doubling down on nature, an alliance to accelarate the adoption of cleaner fuels, SEC to implement a rule to avoid misleading investment fund titles and Verra’s new ARR Methodology.

  • Why companies are doubling down on nature
  • An alliance to accelerate the adoption of cleaner fuels 
  • SEC: avoiding misleading investment fund titles
  • Trending: Verra announces innovative, high-integrity ARR methodology

Why Companies are Doubling Down on Nature

Addressing unsustainable relationships between humans and nature is crucial to achieving global climate goals. Over half of the world’s GDP faces nature-related risks, impacting every sector. To achieve climate goals and mitigate these risks, the UN Environment Program suggests mobilizing an extra $230 billion annually for nature protection, with greater private sector involvement needed. Some corporations have wavered in their support for nature-based solutions. Still, a TIME CO2 roundtable of sustainability executives highlighted the tangible business benefits, and leading companies continue to invest in nature for environmental and business reasons.

Invert Insights:

Despite challenges and media scrutiny, leading businesses continue to invest in nature-based solutions, driven by reasons beyond carbon reduction, such as increased biodiversity, water security, financial returns, and overall business resilience. These companies acknowledge the importance of transparency and learning from failures to accelerate progress on their climate journey, emphasizing that demanding perfection can hinder broader climate action adoption. Ultimately, businesses are not retreating but rather doubling down on their commitment to nature investments, not only due to external pressure but because it aligns with their long-term business interests.

An Alliance to Accelerate the Adoption of Cleaner Fuels 

Amazon, IKEA, Patagonia, Green Worldwide Shipping and 20 other companies have partnered to buy zero-emissions maritime fuel in bulk. The group is looking to acquire enough fuel to power the transport of 600,000 20-foot containers over a period of three years. Global Shipping accounts for 3% of climate emissions and 90% of world trade is transported by sea. The group set guidelines for what they consider zero emissions fuel and requested proposals for 2025.   

Invert Insights:

Collaboration between businesses is crucial for sustainable development, and this association sets the pace for others. Through this alliance, organizations can mobilize and share knowledge, expertise, technology and financial resources. Perhaps more importantly, it has the potential to unlock economies of scale, making zero-emissions fuel more economically viable; ultimately, accelerating the adoption of cleaner fuels across the industry. 

SEC: Avoiding Misleading Investment Fund Titles

Fund names provide potential investors with a first impression, and as a response to concerns around ESG, the SEC has added an amendment to the Investment Company Act’s Names Rule, requiring fund titles to accurately portray the thematic focus of their fund. In order to do so, the 80% investment policy must be demonstrated which requires funds’ names to represent at least 80 percent of the value of the firm’s assets, especially if they incorporate any ESG factors. 

Invert Insights:

As greenwashing concerns and ESG skepticism are on the rise, regulated transparency and clarity on fund names could bring back investors’ trust in projects that positively impact any of the ESG factors—preventing misrepresentation of the fund’s investment and risk.

Trending: Verra Announces Innovative, High-Integrity ARR Methodology

Verra, announces its new Afforestation, Reforestation and Revegetation (ARR) methodology. It’s the first of its kind, utilizing dynamic performance benchmarks and relying on remote sensing data to establish the baseline and test additionality. The new methodology will ensure the generation of higher-quality nature-based removal credits. 

Keep Reading: