Investing and Entrepreneurship in Water at Investors' Circle

waterWater is fast becoming top of mind, joining oil as a precious resource, and carbon as something companies ought to pay attention to. A panel of water investors and experts discussed opportunities in water at the Investors’ Circle conference. My takeaway from the conversation is that water is a difficult (read: fragmented, inefficient, and complex) issue, but one that demands our attention and our intelligence. The panel featured David Zetland, a Postdoctoral Fellow in Natural Resource Economics and Political Economy at UC Berkeley, Brian Dunn, CEO of Growth Capital Services, and Dominic Kulik, founding Principal of Dakai Enterprises.

We just scratched the surface of the complexities of water. Panelists generally agreed the term “water market” is a misnomer, as we really don’t have any sort of market for water. Rather, monopolies rule, Zetland explained.

“Water is on a 10 year lag to alternative energy,” Kulik explained. Water is undervalued, and the system is inefficient. The field is begging for clear competitive mapping and analysis, but this does not exist as yet.

Water is difficult for angels to get involved in, Dunn commented. You need to get in early enough, or you’ll be dealing with project level financing.

A recurring theme at the conference was a focus on the local. Zetland stressed that water is a local issue – most decisions are made at the local level. For example, California has 1,200 water districts.

Kulik explained his interest in soft-path, rather than hard-path investment opportunities. Hard path describes infrastructure, which he characterized as conventional, energy and capital intensive. Soft path refers to alternative, appropriate, energy efficient solutions, which can mimic natural systems. When exploring the sustainable water investment opportunity landscape, Kulik is most drawn to the soft path solutions that treat water holistically, considering the full water cycle, such as local rainwater catchment systems for local land application and filtering water using natural elements like sand.

From what we know of the competitive landscape, water is dominated by giants like GE. But panelists encouraged entrepreneurs not to shy away, but rather to get in on the local and regional level, where most business happens, and where fragmentation and inefficiency have kept the giant players out. Dunn explained that water is “cliquish,” and biased towards engineers with the right name brands behind them. But water managers are risk averse because there is no penalty for incompetence in water management, Zetland noted, making the water space prime for breakthrough innovation in my opinion.

Originally posted on TriplePundit

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How to find great interns: A few tips

At SVT we’ve taken the downturn as an opportunity to build our team and internal capabilities. We recently brought on 5 highly motivated and capable interns. Given the surplus of available work, and the desire many have to move into more sustainable/socially just career paths, I recommend taking this opportunity to find great interns. If you have a social or environmental mission as we do, I bet there will be a lot of interest. Here are a few tips to guide and enhance your search process based on my experience recruiting at SVT.

1) Define the role thoughtfully. Take the time to really think through what you’d like an intern to do, and lay out the expectations and tasks assigned. If it is unpaid, make sure you maximize other opportunities (school credit, networking, recommendation writing, etc). The more details you provide, the more likely a job seeker will apply. And the more likely that job seeker will be self-selected to fit with your organization.

2) Create a recruiting timeline and stick to it. How long do people have to apply? How soon will they hear back (this was tricky for us, but something I would try to improve on next time)?

3) Select strategic places to post your position. I have a list of recommended sites based on what we were looking for but this will vary depending on what you want. We were on a budget and chose not to pay for listings. We also wanted folks with whom our mission would resonate and be a motivating factor. Here is a list of where I posted and my thoughts on other major sites:

Free sites

  • Net Impact – this is a great site to find motivated MBAs interested in sustainability and CSR. This was probably the best place we posted, and it is free to post internships.
  • GreenBiz.com - free posting, good for green jobs
  • CleanTechies.com – free job posting for limited time
  • Post to your own website and blast an email with links to all your networks
  • College job boards – strategically select schools and MBA programs that have the types of students you’d like to hire. This is a great source of high quality summer interns. Start with local schools and then look to schools whose students will have the skills you want.
  • Doostang – this is an exclusive job searching community
  • LinkedIn – allows you to forward your job posting for friends and request recommendations
  • Many job sites will automatically syndicate your listing – this happened in my case with Indeed.com, Stopdodo.com, Simplyhired.com and a few others.
  • Since recruiting, SustainLane created a Green Collar Jobs Board, which is worth posting to

Paid listing options

  • JustMeans – less traffic than Net Impact, but a similar set of people with targeted interests.
  • Idealist –likely a great place to post (we did not post due to fee)
  • Craigslist – I would NOT recommend posting to Craigslist gigs (which is free), and we did not pay to post to their job listing section, which might have given better results

4) Select thoughtful interview questions. Here are a few I would recommend:

  • What do you do in your space time? Harvard Business Review cites this as the interview question you should always ask
  • What type of work environment do you thrive in? - this will allow you to ensure that your organizational culture is a match
  • How are you best managed? - this will give you a sense of the degree of responsibility the candidate would like to have – some want total autonomy, others require more guidance and structure.
  • Describe your best day at work in the last 3 months and what you were doing? - ensure that the type of work aligns with the candidate’s interest
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Live from Ceres Conference: Focusing on Real Wealth to Build a Sustainable Capitalism

We’ve been dealing with economic and climate problems in a manner similar to the wise men in Isaac Bashevis Singer‘s stories: Instead of filling in a dangerous pothole, we’ve decided to build a hospital alongside of it to treat those injured. At today’s closing panel at the Ceres Conference, experts weighed in on how we might rebuild a capitalist economy for sustainability and what went wrong.

Leslie Lowe, director of Energy & Environment Program, Interfaith Center on Corporate Responsibility drew applause from the crowd on more than one occasion, demanding radical system change. “As long as sustainable investing is a just a preference for some investors, it’s not going to change the system.”

David Blood, senior partner at Generation Investment Management laid out three steps to correct the system. Given that three quarters of people polled in the developed markets think that people in “our line of work” (i.e. finance) are overpaid, dishonest, or both, we have a real “crisis of capitalism,” Blood relayed:

1.    We need to internalize externalities by putting a price on carbon and rethinking how we calculate GDP.
2.    We need to acknowledge that environmental, social and governance issues are critical business issues, not just “nice to have.” This needs to become a mainstream conversation.
3.    We need to rework the compensation structure for asset managers such that it rewards long-term performance. The current system promotes short-term thinking by rewarding on quarterly outcomes, which is detrimental to economies.

Lowe asked how an honest company can compete with “banksters” using fraudulent accounting — and advised using collective power to solve the problem. “We’ve been bystanders of the catastrophe,” she said. “We need to accelerate — we are moving at a snail’s pace and the problems are on the superhighway.” Ideally the SEC and the EPA would work together to enforce environmental disclosure.

Lowe really got to the heart of the issue when she said: “We’ve mistaken the measure of value for value itself. Paper is paper. Real wealth comes from water, energy, soil, sun. We’ve got the idea that pieces of paper are our future … We need to focus on real wealth.”

Continue reading on GreenBiz.com

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PG&E CEO Stresses Need for Bold Action, Collaboration

At this week’s Ceres Conference, Peter Darbee, Chair, CEO and President of PG&E Corporation delivered an inspiring speech. As Darbee sees it, the key to a sustainable future is not technology, but rather working together as a functional, collaborative team, instead of the dysfunctional team that we often are. “We say we want renewable power,” but when push comes to shove people, in Nantucket for example, say “not in my backyard.”

Sustainability must be our number one priority, which will involve sacrifices and tradeoffs on all fronts. “We are faced with the greatest challenge mankind has ever faced,” Darbee explained. “We need to work together as a US team and as a world team with vision and values to overcome these great challenges for mankind.”

PG&E has sometimes received mixed reviews, but I was encouraged to hear its leader’s bleeding edge sustainable views. “People say [renewable energy] is too expensive, but they don’t have a clue how expensive it will be if we don’t deal with the problem…I know it’s exponentially cheaper to deal with fixing the problem now rather than waiting. That is crazy and reflects that people aren’t very thoughtful.”

Darbee described his vision of a bold future:

1. Plug in electric vehicles will be charged at night, and provide energy to the grid during the day
2. A home grid network will allow appliances to interact with each other. A computer will monitor energy prices and control energy accordingly, shifting demand to night when energy is inexpensive
3. Dynamic energy pricing will incentivize energy use when it’s in lower demand
4. Air conditioners will be smart so that they are off during the day and turn on just before you arrive at home
5. The key will be integrating these technologies – each one can save us a lot, but integration will create the real opportunity

Darbee explained the projects PG&E is working on to make this bold future a reality:

1. Energy efficiency solutions
2. Plug in hybrids
3. Demand management response which shifts energy use to later in the day
4. Energy efficiency implementation in homes in the community
5. Exploration of unconventional renewable sources such as wave, tidal, biogas, and most recently space energy

PG&E recently announced its partnership with Solaren Corp. to harvest solar energy in space. PG&E will only pay for energy to the extent that it is possible to collect. Darbee has undoubtedly received consternation for such a decision, but he backed it up saying, “So many times people say things won’t happen. Never say that, instead I try to think ‘How might that happen?’ Lots of people think PG&E has lost it…That’s what bold is all about. If everyone said yes, [that will work], that isn’t bold. If it does work, how extraordinary will that be?”

[Originally posted to TriplePundit]

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Live from the Ceres Conference: Robert Redford Charms Audience

Wrapping up a jam-packed day at the Ceres Conference, Robert Redford took the stage Wednesday night in conversation with Sally Osberg, CEO of the Skoll Foundation. Redford opened by praising Ceres President Mindy Lubber and went on to tell many a captivating story, some related to climate change, some not.

“It’s all evolutionary,” Redford explained, “I started as an actor, acting led to producing my own movies, producing led to directing and success led to new opportunities” to work in the broader world towards greater environmental sustainability.

When asked about his mentors, Redford described a grade school teacher. As a kid he would draw stories during class, and couldn’t be bothered to pay attention. In anger, the teacher made Redford show the class what he was drawing (cowboys chasing Indians over a cliff while being bombed). That teacher realized his story-telling was a talent that should be nurtured and once a week she would let him show the class his drawings.

Image from Ceres Program

The most memorable story conveyed Redford’s humility and sense of humor. Redford had been asked to speak to a group of bankers in Utah. He wasn’t sure why he was there and ended up delivering an angry harangue. At the end, there was dead silence and everyone filed out. Redford was doubting himself and thinking he’d made a mistake.

As he was leaving, someone approached Redford and said “Appreciate your comments. I have one question — did you really jump off cliff in ‘Butch Cassidy and the Sundance Kid?’ ”

“That’s when I realized that what I say doesn’t matter,” he told the audience at the conference.

Osberg referred to Redford as “the quintessential social entrepreneur” given his work with the Sundance Festival, Channel and Catalog. “You must be proud” of your accomplishments, Osberg said. Redford laughed and said “I put my money where my mouth is, and I’m not a good businessman. Risk is a big part of my life.” Redford said his central interests are art, commerce and conservation — “Sundance is a triangle of this.”

Redford received applause when referring to the new administration in Washington, “Thank God we now have a change — we were desperately needing one.” But he sees change as more grassroots and community driven than administration-driven.

“I’d been beat up good for speaking about the environment. I’ve been considered a treehugger, granola, and worst of all an actor. People wonder, ‘what does he know?’ ” In the mid ’80s, Redford heard leaders in both the Soviet Union and the U.S. talking about global warming, clearly ahead of their time. So he brought the two groups together to discuss at a three-day conference at Sundance in 1989. He sent a document that came out of that conference to George Bush Sr., and it never saw the light of day. No one knew about it. “It was a good idea, but not at the right time.”

Continue reading on GreenBiz.com.

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Live from the Ceres Conference: Corporate Sustainability Reporting and Beyond

Today’s Ceres Conference in San Francisco was host to a lively panel discussion on sustainability reporting. Paul Hilton, director of Advanced Equities Research at Calvert moderated a panel of speakers representing industry, accounting, data management and policy.

Sustainability disclosure has come a long way, and not surprisingly, has a long way to go yet.

Panelists represented the leading edge in reporting and discussed both what excites them and what needs to happen to push forward.

Hilton opened the panel with his top five trends promoting a better disclosure landscape:

  1. Movement towards mandatory disclosure
  2. Improvements in frameworks/tools for reporting
  3. Increased corporate interest in improved reporting
  4. Active ownership
  5. Mainstream investors demanding data

Beth Holzman, CSR strategy and reporting manager at Timberland, explained what’s happening at the leading edge of corporate reporting. Emil Efthimides, manager of the Environmental, Social and Governance Data Project at Bloomberg, discussed Bloomberg‘s current work to organize the world of ESG data. Jonathan Jacoby, senior policy advisor for Oxfam America’s Private Sector Department brought a policy perspective, but unfortunately didn’t get much of a chance to speak. And the fourth panelist, Alan Willis, sustainability advisor for Canadian Institute of Chartered Accountants, made inroads to public forgiveness for the glaring missteps by some in his field.

What are the exciting developments in ESG disclosure? New reporting tools and mediums, more audiences, varying mediums to reach varying audiences, and imperative to demonstrate increased consumer relevance topped Holzman’s list of developments.

Willis described a recent CFA investor manual to help integrate ESG into accounting work, as well as clever user websites. “On the HP website you can create your own sustainability report by customizing the bits you want. There are traps and pitfalls of course, but I find this otherwise encouraging,” Willis explained. “What I’d like to see is better progress around sorting [that information] out — we are all over the map in terms of what companies are doing. The credibility of our numbers has a long way to go.”

Efthimides described how Bloomberg is continuing to revolutionize financial markets with transparency of information. “Now we are looking at the ESG world, scraping all data available and putting it together and making it all available,” Efthimides explained. “Eleven percent of assets under management are socially responsible.  Now the other 89 percent will get a chance to see that 11 percent. Maybe they’ll dabble in it or even request that information from companies. It will become a virtuous cycle.”

Continue reading on GreenBiz.com

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Live from Ceres Conference: The Water-Energy Nexus

The connection between water and energy was discussed during a morning workshop at today’s Ceres Conference in San Francisco.  Moderated by Jon Jensen, executive director of the Park Foundation, the panel brought together three outspoken voices from non-profit, industry, and investment organizations: Jason Morrison, program director, Globalization at the Pacific Institute; Peter Williams, CTO of Big Green Innovations at IBM; and Kenneth Sylvester, assistant comptroller for Pension Policy in the New York City Comptroller’s Office.  Each party had a unique perspective.

Morrison (who I also covered when he spoke at the State of Green Business Conference) started off the discussion by outlining the problem and a four step solution plan. The water problem is that 900 million people lack access to clean water, and this number is growing; demand for water is increasing; and more and more parties want to have a say in how water is managed, so water is fast becoming a socio-political and economic issue.

“We are coming from a water abundant era, and companies don’t see water as a risk to business.  Especially as it is relatively cheap,” Morrison explained.  He advises that companies account for water risk in three categories: physical, regulatory, and reputational, as outlined in a paper Ceres and Pacific Institute produced.

More importantly, water, energy and climate are all interconnected, but policy makers and the general public does not get it yet.  Climate change will increase the demand for water.  For example, drought causes increased need for irrigated agriculture.  A few factoids Morrison shared were simply shocking:

1) Running hot water from your kitchen faucet for 5 minutes uses the same amount of energy as running a 60 watt light bulb for 14 hours.

2) In California, the single largest energy user is the state water project which moves and treats water from north to south – 20 percent of California electricity is used in this way.

But people fail to connect energy and water.  As such, Morrison advised companies of the following strategy to mitigate water risks:

1) Measure your water footprint, so you can identify hotspots and prioritize issues

2) Assess your risk

3) Formulate integrated responses to your water risks and footprint

4) Disclose your water performance, risk, and your undertakings to manage that risk

In other words, measure, manage, and communicate your water footprint and risks.  Later on in the panel, Morrison built on this, encouraging that we all need to think more holistically and more collaboratively about the challenges at hand.  We can’t think only of our company on its own, but we must broaden that to include the communities we operate in and the bigger picture.   One bright spot is that “scarcity makes creativity flow.”

Continue reading on GreenBiz.com

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Everything Is Connected to Everything Else: Economic and Ecological Bubbles

Denis Hayes, President and CEO of the Bullitt Foundation, kicked off today’s Ceres Conference in San Francisco with a reminder that no nation can solve climate problems on its own – we must come together as a species because everything is connected. North African dust has been correlated to hurricanes. We have all breathed an atom that was exhaled by Julius Caesar when he said “Et tu Brutus?”

Economic bubbles and ecological bubbles
Globalization has raised the stakes for both economic and ecological bubbles. “In America bubbles have to do with…delusions that mouse clicks can be monetized, and that my house can double in value every three years,” Hayes explained. But economic bubbles and today’s crisis will end – illiquidity is not irreversible.

Ecological bubbles on the other hand are not reversible. Ecological bubbles don’t bounce back. Today’s prices do not reflect ecological realities. We are undermining values of ecosystem services and not including it in our accounting. These costs that are treated as external are larger and more important than internal factors, and they have grown to awesome proportions. “Sooner or later, mother nature will break our kneecaps,” Hayes warned.

What should we do?

Hayes had three suggestions:

1) We need to reproduce within the planet’s carrying capacity.
We are overshooting our carrying capacity and we need to scale back population growth dramatically. Nature will do it for us in catastrophic ways.

2) Substitute craftsmanship for throughput.
We’ve created an economy which values consumption, rather value, quality and endurance. Today’s products are not designed to last. “My parents never used a credit card, nor did they have a mortgage. They didn’t buy much, but when they did they always bought the best that they could get,” Hayes told us. Today we are buying junk, “sawdust and glue furniture, which disintegrates quickly.” And the sad truth is that the faster wood moves from trees in the forest to the dump, the faster the global economy grows and prospers. Our economy is based on the willingness of Americans to buy junk they don’t need that they can’t afford. “In a world where we’ve run past resource limits, we need to place highest economic value on quality and endurance, not planned obsolescence.”

3) We need to temper the extremes of wealth and poverty.
Hayes explained: “I had dinner with Jared Diamond, author of Collapse, and I asked him ‘What is most important thing we need to do to postpone collapse?’ He said collapses most commonly occur when rich shield themselves from the consequences of their actions.” Until we can redistribute wealth more evenly, we will bounce from one bubble to another.

Originally posted to TriplePundit.

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Impact Investing at Investor's Circle Conference

I’ll be attending and covering the Investor’s Circle Conference this year. My day job at SVT Group involves impact management consulting for social ventures and my writing focuses on the social enterprise space as well. (I recently reviewed a new book by former Investor’s Circle Chairman, Woody Tasch, Slow Money, as well as a book by Investor’s Circle poster child Tom Szaky of TerraCycle.) So I am excited to get a glimpse of this year’s bright ideas and learn from the field’s experts.

I’m particularly looking forward to the afternoon session on “Impact Investing.” I recently wrote about my struggle to find a better bank on JustMeans. I think there is tremendous room for improvement in the way our money is invested, including liquid cash. As such, I recently moved my short term savings from Bank of America and ING to Shorebank and Microplace. My next project will involve moving my longer term investments into companies and vehicles that better reflect my values. So I’m excited to learn more.

The Impact Investing panel offers four experienced speakers:

Amit Bouri works for the Monitor Institute. At last year’s Social Capital Markets Conference, Bouri’s colleague, Katherine Fulton gave a fantastic keynote speech which laid out a framework for growth of the social capital markets. So I look forward to hearing Bouri’s perspective. Since SoCap08, Bouri helped publish a new paper Investing for Social and Environmental Impact: A Design for Catalyzing an Emerging Industry.

Brinda Ganguly works in Program Related Investment (PRI) at the Rockefeller Foundation. I’ve always been impressed and inspired by Rockefeller’s leadership in this arena, so I’m looking forward to learning her outlook. While PRI and other forms of impact investing are growing, I am still shocked by how many foundations and university endowments continue to be invested in traditional asset classes with little social or environmental impact.

Don Shaffer is President and CEO of RSF Social Finance. RSF is another leader in the field and after hearing him speak recently for the first time, I’ve grown to truly admire the work they do. Instead of making investments, RSF gives loans (as well as grants) to sustainable businesses within the areas of Food & Agriculture, Education & the Arts, and Ecological Stewardship. The low interest loans they offer allow businesses greater flexibility and maintained focus on mission and impact.

Peter Sturgatz, the fourth panelist, is co-founder and co-CEO of IceStone. IceStone creates countertops with 100% recycled glass and cement. A B Corporation and Investor Circle alum, IceStone has also received Cradle to Cradle Gold Certification. Like the other panelists, Sturgatz has experience on the investing side, having run a socially minded venture firm for 6 years. The panel will discuss IceStone as a case study in profit-seeking investment that also generates social and environmental impact.

I’m really looking forward to taking part in this meeting of the minds!

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SVT Group Showcased in BusinessWeek Among “America’s Most Promising Social Entrepreneurs”

svt-groupI have the pleasure of writing about my own company today!

This week BusinessWeek announced the 25 finalists of its inaugural “America’s Most Promising Social Entrepreneurs” contest, and we at SVT Group are thrilled to have been named. SVT is an impact management advisory firm that helps clients to measure the social and environmental impact of their work, and to wield this information as a powerful business asset.

This contest is part of the mainstreaming of social entrepreneurship and an indicator of the field’s rapidly expanding breadth and influence. As noted in BusinessWeek, B Lab, a certifier of social enterprises in the US, estimates that there are now 30,000 social enterprises generating some $40 billion in revenue. Given the growth of these enterprises, having tools to measure and manage their actual social impact is becoming a critical need, as well as a lever on the rest of the business community, who in turn face growing pressure to demonstrate that they aren’t the “bad guys.” SVT has been focused on serving and cultivating this market since 2001, and we’re very excited to see that others are seeing value in the work.

Other contest finalists work within a wide range of endeavors, from online book sales that benefit charity (Better World Books), to sustainable, artisan farmed seafood (Cleanfish). All finalist enterprises, chosen from an entrant field of 200, demonstrate a strong emphasis on generating financial profit, as well as social and environmental returns.

SVT was noted for its trailblazing work as the first advisory firm to specialize in valuating non-financial, social and environmental return on investment.  Past clients have used the information gained from SVT’s impact measurement to inform critical business decisions, drive investment toward areas of greatest potential impact, and ensure accountability for results.

Browse finalist profiles and cast your vote here. The deadline to vote is Sunday, April 26 and the top 5 vote-getters will be profiled in BusinessWeek online in May.  I appreciate your support!

[Originally published to JustMeans]

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