Investment management firm Circulate Capital is adding to the diverse sets of guidelines emerging in recent years for institutional investors looking to deepen their considerations on impact investing.
As an impact-focused firm specializing in infrastructure, Circulate Capital has taken on the mission of leveraging capital to stem the flow of plastic into the oceans. “We’ve spent enough time pointing at the problem. Now we have to focus on the solution. The time to act is now,” said Rob Kaplan, founder and chief executive officer of Circulate Capital at the World Ocean Summit in Abu Dhabi this week, according to a press release.
“We recognized we had to refocus the conversation on investible solutions that are ready for deployment today. Our goal with this handbook is to provide institutional investors with the knowledge and insights they need to catalyze investment and action in waste management and recycling infrastructure in south and southeast Asia.”
The handbook highlighted that India and Indonesia have the most readily available, potential investments in the region. Further, the majority of opportunities lie in investing downstream in the value chain, namely plastics processing and reuse, whereas smaller opportunities exist earlier in the chain, including collection and sorting.
As well, it noted most of the private capital invested in the solid waste management and recycling sector in the past decade has come from local sources and is ripe for foreign institutional investment.
“There are no silver bullets to solving the ocean plastic crisis,” said Kaplan. The handbook encourages leveraging support from national governments by encouraging helpful policies, as well as working with communities on a more micro scale.
The guide adds to a growing universe of advice for institutional investors on various topics within environmental, social and governance issues. Often the advice is quite specific; for example, the United Nations’ Principals for Responsible Investment published a guide in 2018 for institutional investors on how to address income inequality.
Also in 2018, the International Centre for Pension Management produced a guide for pension plans keen to understand their impact on climate change. In creating the handbook, Circulate Capital coordinated with Ocean Conservancy, an organization seeking science-based solutions to protecting the world’s oceans.
“Building on the important work begun by Ocean Conservancy nearly four years ago, the handbook is open-sourced so we can share our knowledge with all participants along the plastics value chain,” said Kaplan. “Working together, we can solve this problem.”