How capital markets can decarbonise the planet with iClima Earth

We have to cut emissions by half by 2030.

That’s what came out of the Cop26.

So, HOW are we going to do that? Where is that going to come from?

And more specifically, where is the tool to say we’re on track?

Who is monitoring this? And then the million dollar question – are the box ticking ESG strategies going to be enough?

In this podcast, I talk with Gabriela Herculano and Shaila Leekha, co-founders of iClima Earth, an impact green FinTech with one sole focus – to use capital markets to decarbonize the planet.

Gabi and Shaila are both Wharton MBA graduates, with over 45 years of professional experience between them in the finance and energy sectors. After meeting at GE Capital in London, they decided to join forces, and use their power to decarbonize the planet.

Today they talk to us about the journey of getting to where they are now and what they are doing to make real impact.

Gabi tells us of her time in Glasgow when she presented at the Cop26. …and they talk of their hope.

Keen to hear how capital markets can decarbonize the planet? How you can also be a part of this movement? And what is in store for the next 10 years? Have a listen.

If you’d like to check out iClima.Earth, click on the link. If you would like to reach out to Gabi and Shaila, they would also love to hear from you. Please reach them on LinkedIn using the links above.

And please don’t forget to let us know what you think of this episode, leave a review, and subscribe.

00:00:02:05 – 00:00:27:03
Philippa White
Welcome to the show, where we unearth new ways of looking at ever evolving lights around the world. Seen from a number of different industries, cultures and backgrounds. But there’s one thing that unites everyone I speak to. They all want to do their part to make the world better in their own unique ways. It’s a uniting passion. Whether they’re from the commercial world, third sector or public sector from the Global North or the global south.

00:00:27:15 – 00:00:54:09
Philippa White
My name is Philippa White and welcome to TIE Unearthed. Hello and welcome to episode 40 of TIE Unearthed. That was COP 26. Taught us anything. It’s the time is now for real climate action to be made. There’s no more time for talk. And we need the private sector to step up. And we’re not just talking about box ticking ESG strategies.

00:00:54:18 – 00:01:27:06
Philippa White
We need to see real change. But what does that look like? Today I’m speaking with Gabriella. Who? Kulanu and Sheila Leacock, co-founders of I Climate, Earth and Impact Green FinTech with one sole focus to use capital markets to decarbonize the planet. Gabriella, Inshallah are both Wharton MBA graduates with over 45 years of professional experience between them in the finance and energy sectors.

00:01:27:18 – 00:01:59:15
Philippa White
And after meeting at GE Capital in London, they decided to join forces and use their power to decarbonize the planet. Their goal to be the go to place to understand what will in real terms decrease carbon emissions and to find the companies that prevent damaging emissions from ever being made and makes it possible for you or other people to invest in them so that you can be part of transitioning the world to carbon neutrality.

00:02:00:09 – 00:02:25:04
Philippa White
We talk about Gabi’s experience presenting at COP 26 what she took out of that experience and what gives her hope. We talked about the journey they are on and where they see things in ten years from now. It’s an absolutely fascinating discussion. So put on those running shoes or grab your favorite beverage. And here is Gaby. Inshallah. Hi, Gaby and Sheila.

00:02:25:04 – 00:02:30:17
Philippa White
It’s lovely to have the two of you with us, with me today. Where are you calling from?

00:02:31:05 – 00:02:34:08
Shaila Leekha
I’m in West London. In Hammersmith.

00:02:34:15 – 00:02:35:16
Philippa White
Oh, lovely.

00:02:36:00 – 00:02:40:06
Gabriela Herculano
Yeah, I’m in North London. I’m very close to where the Beatles have their studio.

00:02:40:11 – 00:03:16:02
Philippa White
Oh, yes. Happy Road. Very nice. Lovely. Well, thank you so much, both of you, for joining us. So today we’re going to be talking about all of the incredible work that you’re doing in the area of fintech and investments and improving the world. And so what I’d like to talk about, though, before we get into a climate and the COP26 and all that kind of stuff, can you just talk to us a little bit about your backgrounds and you know what you did before you became co-founders of AI Clima and how you met one another?

00:03:16:05 – 00:03:32:07
Gabriela Herculano
Yes. PHILIPPa, I know you’re recording this from Brazil. I grew up in Brazil. I grew up in Rio. And I spend, you know, my first 20 years of my life in Brazil. So I grew up with this question, you know, of how do we develop this country? And infrastructure was the very big, you know, a very big bottleneck.

00:03:32:07 – 00:03:53:03
Gabriela Herculano
So for me, you know, since I was a small kid, I always thought, you know, there’s got to be a way for us to to make all the investments that we need. We need infrastructure, trees so visible the need for that infrastructure. It was in the seventies and eighties. So since I was a small kid, I knew I wanted to work in the energy space, in the infrastructure space.

00:03:53:03 – 00:04:14:09
Gabriela Herculano
And I knew that finance and economics was the way that was the missing link. It’s how are we going to finance all these things and we don’t have money. Why is it that we don’t have right? What is it that it takes? So I did economics in Brazil and then I was very lucky. I was working at a bank in Brazil that formed a consortium with Lehman Brothers to do some sell side mandate.

00:04:14:09 – 00:04:38:19
Gabriela Herculano
That’s when you advise the government how you auction your assets. And I was a very big believer. Continue to be that we need to privatize the government, in particular in emerging markets. That’s not where innovation takes place. That’s not the best way to to manage and make very big investments and further develop certain industry. So I was a very big believer, continue to be on the need to privatize.

00:04:38:19 – 00:04:55:23
Gabriela Herculano
And that’s what I did in the nineties together with Lehman and then Lehman maybe, and after I moved to New York and then never went back, so I went to business school, my boss in Lima went to Wharton, I went to visit. He was very active in the alumni community and I fell in love, love at first sight.

00:04:55:23 – 00:05:18:05
Gabriela Herculano
I said, I’m I’m going to come to this school. This is, you know, finance. This is this is, you know, my kind of people. So I applied, got in, loved every second of it, graduated class of 2002, then moved with that from the so-called South Side, where you work 100 hours at a bank. I spent my summer at Goldman Sachs working 100 hours a week.

00:05:18:05 – 00:05:37:07
Gabriela Herculano
You know, the stamina you have when you are in your twenties and then got married, moved to London, and then with that, I moved to the to the so-called buy side, and that’s where I met Shiela. We work together at GE Capital here in London, underwriting investments in renewable energy. And I loved it. You have a you take a much longer term view.

00:05:37:18 – 00:05:58:15
Gabriela Herculano
You really you know, you will be there when things go go wrong. And they they will. And you go very, very deep. You look at power purchase agreements, IPC contracts, what’s called engineering procurement and construction. How exactly do you build these very expensive things that take two years to build? And then how do you finance them? In what structure?

00:05:58:20 – 00:06:21:21
Gabriela Herculano
I loved it. It was very intense. I loved every second of it. And then we’ll talk later about how, you know, a few years later we got together and we created i clima but i our shift to charlotte. She has a visor. So you will see later on we’ll talk about that, how we we put together this background of, you know, mining, public sector and private, meaning public equities and private equity.

00:06:22:01 – 00:06:28:09
Gabriela Herculano
And Charlotte has a public private background as I’ll she’ll talk to you about that so we merged that to those two things.

00:06:28:11 – 00:07:00:21
Shaila Leekha
Thank you so much for having us on, Phillip. Yeah, in terms of background, similar to Gabby, I grew up in Pakistan, I was born in Karachi, but we moved at a very young age to the U.S., to Washington, D.C., and then moved back when I was 13. And those were really formative years of my life. So, you know, I grew up with or as was my first language and then went back at 13, not being able to speak it at all and having to start from the basic and kind of seeing the difference in the two countries, especially at that very kind of, you know, formative stage in life was eye opening for me.

00:07:00:21 – 00:07:16:10
Shaila Leekha
There were a lot of freedoms that I took for granted growing up in the U.S., coming to Pakistan. You know, I just didn’t have and similarly, there were a lot of things I also took for granted. You know, this is back before the day of regular travel. Now we go multiple times to visit family anywhere in the world.

00:07:16:10 – 00:07:34:17
Shaila Leekha
But for those eight, nine years, we probably went twice back to Pakistan. And so when I did go back at 13, I was struck by the living standards and poverty around me. And it just didn’t make sense, you know, like all kids, I was always very curious to understand how the world works. And it didn’t make sense. And I felt that I had a role to play.

00:07:34:17 – 00:07:53:09
Shaila Leekha
And, you know, and it’s something that’s also in my family and background giving back and public service. But I always felt there was a role to play. So I originally always thought when I went back to study in the U.S. that I was going to go for a Ph.D. in economics and work in development economics. And, you know, growing up in D.C., we were in the shadows of the World Bank, had many relatives and friends who work there.

00:07:53:15 – 00:08:15:06
Shaila Leekha
But ultimately, I had good advice early on myself. Ethics were always, you know, math and economics that, you know, get some hard skills and and, you know, take that with you to do something and give impact. So I did that. I went into banking in New York after graduating from Georgetown with a degree in finance and spent a couple of years with those grueling hours and then did eventually make it to the World Bank.

00:08:15:06 – 00:08:38:13
Shaila Leekha
But with the private sector arm doing project finance, so commercial lending to countries and to projects that otherwise wouldn’t have financing available. So that was a wonderful experience. I did my MBA like Abby at Wharton and then and then came to London soon after that. So I worked with her a g capital doing renewable energy, investing on the project, finance on the debt side.

00:08:38:13 – 00:08:57:06
Shaila Leekha
And then after that, I took a break while on maternity leave and did something completely different because I’d always had that call for impact and wanting to do more. There’s an article in The Economist, an ad story for a senior civil servant post working for the Department for International Development here in the U.K. It’s overseen by a cabinet minister.

00:08:57:06 – 00:09:17:03
Shaila Leekha
So I applied and and got that role. And that was a fascinating experience. And it was my way of seeing if policy and giving back, you know, was really right for me. And I oversaw two and a half billion of the U.K. aid budget. I had over 80 individuals in my division across four departments. And it was a wonderful, wonderful experience.

00:09:17:03 – 00:09:45:10
Shaila Leekha
I learned a ton, but eventually I realized, you know, that I’d rather use my skills in the private sector and give back that way. I still maintain a couple of positions on boards of international charities that are linked to development. That still stays close to my heart. But I did have a short stint at Fitch in their ESG practice, and it was interesting because I’d always had this dual interest of development and impact, and then the private sector, where my skills were based in finance and analytics, and for the first time I realized the world was converging.

00:09:45:10 – 00:10:02:19
Shaila Leekha
Those two kind of careers, paths and interests seemed to be converging in the world, and that was super exciting. And so I had my first foray into that world with Fitch and their ESG product. I helped to roll out a scorecard for fixed income using an ESG scorecard that Fitch developed and I helped create. But it was when Gabby approached me.

00:10:03:00 – 00:10:13:17
Shaila Leekha
Soon after that experience, she said, You know, we can do better. There’s so much more we can do. When it comes to climate investing, with our analytical background, our focus on impact, we can do better and the rest is history.

00:10:14:06 – 00:10:36:12
Philippa White
Yeah. Wow. How inspirational and just amazing to see the journey both of your journeys. So what I’m dying to know and I think our listeners will feel this too. So you met at Capitol, Gabby had that conversation with you, but what was that catalyst to set up a climate? What were you feeling at the time and when was that?

00:10:36:22 – 00:10:55:20
Gabriela Herculano
So that was two and a half years ago. I invited Shiloh for lunch and I didn’t really have to, you know, give my full pitch. I thought, you know, how I’m going to entice her to hear me out. And very first 5 minutes, just like I’m in. And I think there are a few elements, right? Like, you know, we’re two years through this and it is hard.

00:10:55:24 – 00:11:27:18
Gabriela Herculano
It is hard. Being an entrepreneur is hard. That’s why there are more you know, many more employees than than employers. It’s constant is draining. You’re going to be out of your comfort zone very frequently at many different levels. And it’s all on you. But I think also it was that ownership that really motivated us. And I think we both have three kids each and it comes to a point where you only want to work number one with people that you really like and care about and really enjoy, right?

00:11:27:18 – 00:11:50:19
Gabriela Herculano
So you wake up early in the morning excited that you’re going to be spending time together. That’s point number one. And I think point number two is that for us, it was about the impact. We wanted to work on something that we really believe would make a difference. And and we had we have this urge, we have this drive, this motivation to say, guys, your everybody’s using a black box ESG scorecard.

00:11:50:19 – 00:12:13:01
Gabriela Herculano
You’re looking backwards. You’re not telling the story that is very relevant. You’re trying to represent these companies that are doing less harm, and that is great. There’s a lot of positive things in companies that are, you know, are really becoming very good, solid corporate citizens. And also ESG is a beautiful concept, but somehow ended up being this black box scorecard tool.

00:12:13:06 – 00:12:33:21
Gabriela Herculano
And we wanted to shift that narrative. We wanted to tell a different story. We wanted to focus on innovation in a very quantifiable metric because it hurts us. We have science is so clear. We need to cut emissions by half by 2030. Nobody has a tool to say, are we on track? Right. We emit 54 gigatons, 54 gigatons last year.

00:12:34:04 – 00:13:00:08
Gabriela Herculano
We know we need to cut that by 7.6%. So that is our denominator, right? That 7.6% of 54, that’s 4.2 gigatons, give or take. You know, we’re going to come from are we are we driving enough electric vehicles? Are we using enough telepresence solutions? Are we, you know, using obviously enough renewable energy sources? Right. So we decided that we were going to attempt to calculate that, and that’s what we did.

00:13:00:08 – 00:13:26:09
Gabriela Herculano
So our approach is very bottom up, is very granular. We’re very close to the company. So, you know, we leave, we read annual reports, quarterly reports, sustainability reports. We call in to investor presentations and all of that great stuff. We have a small team, but a team that is so passionate about what they do and it’s like, shall I say, you know, has merged the way they live their lives is, you know, in the way they work.

00:13:26:09 – 00:13:46:04
Gabriela Herculano
It’s they align purpose with work and it’s beautiful is it is a great to be part of that. So I think it was very much that motivation of doing something we believed in that, you know, aligning hearts and minds and going for something. We just wanted to have a shot to say, Look, this is the way we think it’s relevant here is out.

00:13:46:14 – 00:14:09:16
Gabriela Herculano
Right. It was very much that, you know, that, you know, in you grab that nobody gives you that right to say, you know, here’s my opinion, hear me out, you sweat. Right. You worked very hard. It was not easy. Took us 18 months to gather all that data, quantified this potential, avoided emissions, but people heard was out. And then the guy that is the mastermind, you know, his name is Dennis Pummeling and Mission Innovation.

00:14:09:21 – 00:14:30:08
Gabriela Herculano
He thinks we’re on such a right track that he invited me to Glasgow to present. And I think, you know, we’ll talk about Glasgow in more detail but I think, you know, it is very reassuring to hear people talking about innovation, specific technologies and be very scientific and systematic about how are we going to do this.

00:14:30:09 – 00:14:49:24
Philippa White
That’s really, really interesting. And actually for our listeners, I think it would be great for you to explain what I climate is now because I think it’s important to hear that. But before that, Sheila, you were listening to Gaby. You were in a different place then. It was obviously a very quick sell, but what was the catalyst for you?

00:14:49:24 – 00:14:53:05
Philippa White
What where were you at? Where you thought this is a no brainer? Well, I.

00:14:53:05 – 00:15:15:13
Shaila Leekha
Had already worked with Gaby, and I knew that what she was capable of. So I knew whatever she was doing was bound to be successful and it would be executed perfectly. So I knew without hesitation, that’s absolutely something I wanted to be a part of. But also I feel very fortunate because so many people I know say they wish they could start a business or want to be entrepreneurs, but not having a partner that you really could work together with in a great way.

00:15:15:13 – 00:15:37:23
Shaila Leekha
I mean, I feel very fortunate that we found each other that way because I don’t think there are a lot of people that, you know, have a great friendship, but also professional sort of relationship that they can do that with. So I count myself very lucky in that regard and then exactly like Gaby said, the fact that it was focused on impact but not at the sake of returns, it was focused on impact and therefore led to returns.

00:15:37:23 – 00:16:07:08
Shaila Leekha
And you know, again, my whole life and career up to that point had always been this dichotomy of wanting to give back, wanting to make impact, but knowing my skills were very much focused on, you know, the finance and the analytics. And it was such a great marriage for the two that we could set about doing something completely differently, approaching it with the analytics and research that has defined our careers, and using that as a basis to which we could provide a product that’s truly unique and differentiated from what’s out there.

00:16:07:08 – 00:16:25:16
Shaila Leekha
And I had good knowledge of of what existed because of my time with Fitch. And I knew that there was a void, there was a gap in the way that investment products currently are focused on climate. You know, there’s touching a little bit on what you said about what we do. So we consider ourselves research and data focused company.

00:16:25:16 – 00:16:53:22
Shaila Leekha
So we are looking and scanning for the sectors that are going to decarbonize the planet. And we use as our starting point a scientific study called Project Drawdown, which was led by an environmentalist from California named Paul Hawken, who spearheaded a three year effort with global scientists, more than 100 of them. And the result was these sectors they identified that would play the greatest role in reducing emissions over the next 30 years to achieve net zero.

00:16:54:00 – 00:17:13:22
Shaila Leekha
And they quantified that. So you can imagine the kind of assumptions that went into it, a huge task. But the fact that they were able to do that inspired us greatly. And so that was our starting starting point, looking for the sectors. We then triangulated that with the EU Green Taxonomy. The upcoming regulation that defines what is should be called green and what should not be called green.

00:17:13:22 – 00:17:31:17
Shaila Leekha
Amazing that we would need something like that. But in this day and age we do. It is not evident when there are green funds that have all the usual oil stocks in them that the regulation was formed as a way to provide investors with that clarity because they’re demanding that, you know, so you know exactly what you’re putting your money into.

00:17:31:17 – 00:17:51:20
Shaila Leekha
So we use the EU definitions of what constitutes as green and it’s something we calculate the green revenue percentages for our companies. And then the third pillar of our approach was this metric of potential avoided emissions, which we use to quantify impact. And the beauty of that is that it’s forward looking. So we look at a solution and say, what are the emissions that are prevented?

00:17:51:20 – 00:18:26:14
Shaila Leekha
Because the fact that it’s available. So a zoom call versus everyone jumping into transport to meet, you know, what are the emissions that are prevented because we’re not all getting into a car or a train or a plane in the case of Brazil, to meet. And and it’s that avoidance which is forward looking and is really how we believe the financial community should start thinking a little bit more about in terms of where they channel capital because these are the innovations that are badly needed that need to scale up and we believe very strongly will scale up because we believe the world is undergoing a massive structural shift to more sustainable and green economies.

00:18:26:14 – 00:18:31:21
Shaila Leekha
And so these companies are set to be the winners in that in that change. And so that’s the beauty of the approach.

00:18:31:23 – 00:18:51:12
Philippa White
So you went to COP 26, Gaby, and you spoke on the stage. And I think for those who are listening, who work in the finance sector, all of this will make complete sense for the general person who you know, there’s a lot there. It’s probably quite difficult for people to kind of understand, God, this is just so, so big and it’s kind of complicated.

00:18:51:12 – 00:19:12:08
Philippa White
But I think when we think of COP26 and we think in the terms of what just the general person is worried about and what you would have spoken about, Gaby and how what you do is important to sort of the general person, but also how the general person can engage with what you do. I think just if you could respond to that, I think would be really, really helpful.

00:19:12:14 – 00:19:40:07
Gabriela Herculano
Yes, it was it was amazing. So there was the green pavilion in the blue pavilion. The green pavilion is where the heads of state and the governments were meeting to discuss, you know, all these very relevant issues in the language, precise language, or what is to be agreed. And we can get into those details. And then the United Nations hosted the Blue Center where parallel discussions on innovation and the role of the private sector were taking place.

00:19:40:07 – 00:20:00:06
Gabriela Herculano
And, you know, we look back and we’re all trying to digest very hard what happened. But I do really believe that this cop COP26 is going to be remembered as being the point where the private sector stepped up to the plate. Mark Carney had a big role. Mark Carney, the former head of the Bank of England, he’s now in the private sector.

00:20:00:06 – 00:20:27:02
Gabriela Herculano
He’s cochairman of Brookfield in Canada. He went back to Canada and he launched the Glasgow Financial Alliance for Net Zero shortly before COP. So that’s over 450 institutions, financial institutions joining forces to say we’re going to finance this transition and we’re talking about over $100 trillion as the amount that we will need between now and 2015. So how are we to do that?

00:20:27:07 – 00:20:45:13
Gabriela Herculano
Right. So it was very much the private sector stepping up to the plate to see how we’re going to do that. You know, it’s past the point of how we do this and how. And I think, you know, we like to make this analogy with going on a diet. You you have a target. You know, I want to lose this many kilos end by this date.

00:20:45:21 – 00:21:04:03
Gabriela Herculano
And you have to be scientific because it’s just really hard to lose weight. It might going to cut calories, intake and my going to burn. How are we to do that? Otherwise you just try your very best, then you will fail most likely. Right? So it is the same. And I think we are we’re being extremely vocal in saying we’ve got to look forward.

00:21:04:12 – 00:21:28:02
Gabriela Herculano
We have existing technologies being scaled up. Project drawdown showed us the way all the way to 2050. So let’s bring that to the more granular level. How many electric vehicles did we sell in 2020? How many are we selling in 2021? How are we scaling up? We look at Tesla, you know, we have a few analysts that are obsessed about Tesla.

00:21:28:08 – 00:21:47:13
Gabriela Herculano
I’m to to a big extent. So we looked at, you know, Tesla sold half a million battery electric vehicles last year. And we do believe they will sell 20 by 2030. And we do think that other players will step up to the plate, then turn them players. And we need them. We do need them to succeed and sell at least another 30.

00:21:47:13 – 00:22:14:21
Gabriela Herculano
So that’s 50 million in 2030 out of what would most likely be 90 million passenger vehicles. The men by 2030, is that enough to bring us to around 1.3 gigatons of potentially avoided emissions for the transportation sector for passenger vehicles? The answer is no. So we quantify that. And I think what is extremely important for people to to understand, again, making that analogy, we have a diet.

00:22:14:21 – 00:22:32:14
Gabriela Herculano
We all know that we take calorie intake is about 2000 calories. And you know how much you burn with different things and you have an idea of calorie intake of different types of meals. Right. We need the same we need to understand everybody needs to know that we’re meeting 54 gigatons, that carbon accounting is something we should teach at school.

00:22:32:14 – 00:22:54:07
Gabriela Herculano
Right. We’re on this for the long run. My kids know all kids need to know. And then you need to understand what are the big causes of this global warming? Why is this taking place? And keep the eye on the bone, the solutions and the big milestones. 2030 We need to cut emissions by half, otherwise there’s no way we’re going to get to the 2050 net zero.

00:22:54:12 – 00:23:15:14
Gabriela Herculano
So very scientific, very quantifiable and engaging. You know what you do your house, how you heat it, you know, if you’re above the equator or how you cool it, you know, if you’re south of the equator and how do you go from point A to point B, we need to be very cognizant of all these things and most and foremost, we need to put pressure on the companies that provide you.

00:23:15:14 – 00:23:39:09
Gabriela Herculano
When you buy things from do you recycle? Are you bending that linear economy, making that circular? We all have a role to play. Companies have, and they are stepping up to the plate to take a lot of responsibilities. So the financial institutions and I think that awareness right first step in finding in finding a solution to any problem is the awareness of what that problem is.

00:23:39:16 – 00:23:45:03
Gabriela Herculano
And I think, you know, the 7 billion plus on the planet, we all need to be super aware.

00:23:45:03 – 00:24:23:07
Shaila Leekha
I just wanted to add, Filip, when you mention how people can engage, I think for us we see ourselves as the platform, we do the research, the data. We find the company is very transparent. On our website I Climate Earth, you can find all the research in our articles, our methodology, but we essentially create indices. So we look for those publicly listed companies that represent all these sectors and solutions for whom we can quantify that impact, whose revenue aligns with the EU regulation on what constitutes as green and therefore does not include the polluters and emitters of traditional industries.

00:24:23:13 – 00:24:43:17
Shaila Leekha
So that’s what we do is we create an index of those different solutions and companies and our first index, we have two now our first index is comprehensive. It has 163 different companies across 27 subsectors and all very balanced. So you can kind of see they’re all the different solutions that we believe are going to make a material difference.

00:24:43:22 – 00:24:55:10
Shaila Leekha
Our second index is much more focused on an innovative trend called distributed generation that we see playing a big role in the coming years in the way that electricity is generated and consumed.

00:24:55:12 – 00:25:04:13
Philippa White
Fascinating. I’d be interested to know what have been some of the biggest surprises since you started this journey? Good and.

00:25:04:13 – 00:25:23:07
Gabriela Herculano
Bad. I think we both come from the same background, right? That hardcore of finance, and we’re developing a whole new appreciation for marketing because in the end, it’s like, how do you how do you convey the message? How do you position in what is your brand image and what do you stand for? Of course, you know, it’s so clear what you mean, what we stand for.

00:25:23:18 – 00:25:46:10
Gabriela Herculano
How could people not get it right? It’s all of these and it’s like it took it 30 minutes of, you know, a lot of very passionate pitch. But, you know, you need to nail that down so that people can understand the core of this message because it’s a bit technical, it’s a bit political, unfortunately shouldn’t be. But in some places, particularly in the US, it is seen as such.

00:25:46:10 – 00:26:03:05
Gabriela Herculano
So that is something that we kind of thought, you know, that’s the easy part. The hard part is the is the fight is is the methodology to sustainability. That’s the hard part. You shouldn’t be the marketing, nailing the marketing on the head, but that’s where yeah. Where we were still or is still improving let’s put it that way.

00:26:03:07 – 00:26:30:06
Shaila Leekha
Yeah. Following up on that couldn’t agree more. I’ve been floored by how so much of it comes down to, you know, we’ve perfected we think, you know, it’s a constant evolution, but we think we’ve got a pretty solid philosophy and product and approach and we spend a lot of time on that. But then just getting the word out there and conveying that and having, you know, engaging in that conversation with the people like you mentioned that are looking for something more in connecting to them.

00:26:30:13 – 00:26:52:22
Shaila Leekha
It’s not a straightforward task and one we spend a lot of time now thinking about. So definitely that has been one of the harder things. And then I guess with any startup, you know, we’ve talked before about this, it’s just, you know, it’s back to our banking days in terms of work. It’s just an intense amount of work and some days better than others, but generally overall very positive.

00:26:52:22 – 00:27:10:22
Shaila Leekha
And that’s what keeps us in it. It’s energizing. So we might be working long hours and constantly gauge, but we do it on our terms so we can work around what we need to do for our kids. And, you know, that’s, I think, the most important part for us. It energizes us and we’re able to give that kind of commitment because we believe in the product as well.

00:27:10:22 – 00:27:12:10
Shaila Leekha
But because we’re doing it on our trip.

00:27:12:23 – 00:27:17:13
Philippa White
You when you’re realizing your purpose, it’s a different story, isn’t it? Who inspires you both?

00:27:17:24 – 00:27:37:11
Gabriela Herculano
Well, who inspires us? I think a lot of women, I have to say, when you go into this space, for example, Barbara Brookner at CPI, the Climate Policy Initiative, I’ve been following her work. We’ve met in person chat and I before COVID with her and her team here in London. She gave me an interview a couple of summers ago.

00:27:37:11 – 00:27:59:24
Gabriela Herculano
There’s a lot of women like her in climate change and in climate space, and I saw that at COP. And again, it’s you’re earning that right. And, you know, my voice needs to be heard. And here’s what I have to say. And there’s there’s quite a few we’re part of this group. Women in ETF is great to see and there’s an overlap again on that ESG focus in the sustainability and ETF.

00:28:00:09 – 00:28:20:08
Gabriela Herculano
So I think there’s been a lot of women in the space, a lot of heads of sustainability in ESG. We’ve met quite a few of them. Head of sustainability at Morgan Stanley is a woman, Marissa Drew, who is a Wharton rhetoric class of 92. She’s been kind of like a bit of a mentor to us. She’s global head of sustainability at Credit Suisse.

00:28:20:08 – 00:28:40:04
Gabriela Herculano
She’s a force of nature. We adore her. She’s so eloquent. She’s incredible, passionate, driven, relentless with a huge commitment. We got to do better. So I think, you know, I look up to them and I feel the vibe and I feel this connection over her, over Zoom. But I do feel it and they inspire me. That’s great.

00:28:40:04 – 00:28:59:14
Shaila Leekha
So yeah, absolutely. I couldn’t agree more with what Gaby said. All the work of those women and those that have supported us as well. I guess for me personally, what I have to say also it’s my father who I lost at the end of last year. I always knew he was a great influence on my life and I was like a lot like him.

00:28:59:14 – 00:29:29:23
Shaila Leekha
But I didn’t realize just how profound his effect was on me until unfortunately, it was too late. But he lived his whole life in a way. I realize that I followed by his example and you know, he was not material. He was devoted his life to public service. He was the most humble down to earth person. And, you know, in a society that wasn’t always that way when I grew up and he was an incredible reader, he had the most breath of knowledge of any subject than anybody I knew and was always thinking of how all that came together.

00:29:29:23 – 00:30:02:20
Shaila Leekha
And he was always thinking about reducing things to their simplest form, especially in a place like Pakistan. It was always about what makes sense, how do we get back? How do we make it better? And when he retired from public service, when he left his job in the government, he devoted his time to NGOs in rural areas. And so, you know, that impact I think it has had of his his his life has had a massive influence on who I am as a person and in how I carry myself out as well and the kind of purpose I look for in my career.

00:30:02:20 – 00:30:20:10
Philippa White
I can relate a lot to a lot of what you’ve said. Where do you both see I climate in ten years? If we’re looking to the future, obviously we’ve had COP26 and as you say, Gabby, this was in my view as well. It’s kind of the turning point. It’s it’s sort of all right, what should we do with this now?

00:30:20:17 – 00:30:24:20
Philippa White
And so we’re here. Where do you see ten years from now?

00:30:24:23 – 00:30:43:22
Gabriela Herculano
Ten years is a great question because that’s kind of like that 2030 milestone where we need to cut our emissions by half. And I think that we’re going to be relentlessly asking that question, are we on track and what is it that where is the gap? And we think that, again, the private sector has a huge role to play here because we can quantify it.

00:30:43:22 – 00:31:10:11
Gabriela Herculano
Right. Where’s the gap? Is it gearboxes or wind blades or wind turbines or solar inverters or smart meters or electric vehicles or fuel cells? Right. Is that clean energy storage, long duration storage? We have 3 hours. We have 5 hours are we are 8 hours. Can we cross a season with 100% clean, renewable energy? So it is the most fascinating thing to to be a part of is to see that evolution and keep track because that’s the impact.

00:31:10:11 – 00:31:35:22
Gabriela Herculano
Right. Is not just innovation for the sake of innovation is innovation for the sake of decarbonization and how that is powerful and how is that we’re going to solve a lot of our social issues. And that’s how we met, right? We can power the last billion with that solar panels and that same battery storage. We can provide cleaner cooking for the 2 billion people that you and I learn working together don’t have access to.

00:31:35:22 – 00:31:55:04
Gabriela Herculano
That is these technologies and they decarbonize and they make the planet a better place. So we one should be relentlessly working on that, asking the right questions, providing the data, quantifying that in an open sourced way, providing the public with products that we think are beautiful and relevant. And that’s one of the reasons why we like ETFs exchange traded funds.

00:31:55:09 – 00:32:17:19
Gabriela Herculano
They’re very democratic. They’re listed on the major stock exchanges and the very large pension fund. We be a very big position, same way that a person that has $20 but wants to invest with this idea. And we’re also showcasing that it’s the opposite is a win win because you are representing the companies that are relevant in decarbonizing the planet.

00:32:17:19 – 00:32:39:00
Gabriela Herculano
These are the companies growing so much and poised for additional growth and they perform very well. I don’t know who would hear this podcast. So in some jurisdictions we’re not supposed to talk about returns, but our returns have been absolutely mind blowing and it’s a very simple, completely transparent approach. So we want to bring more to that to market.

00:32:39:00 – 00:33:09:17
Gabriela Herculano
Sometimes the big players, they have conflicts, they have legacy products, they have exposure, and they continue to finance fossil fuel. We want, you know, is a bit of the David and Goliath. You don’t get that if you go to the very big players like the, you know, the black rocks of the world. But because of technology, again, new fintech players have a different way of doing things and can bring to market with speed and accuracy and at a price point that allows us to finance a new venture like climate.

00:33:09:17 – 00:33:31:01
Gabriela Herculano
We can do that. So this is just the beginning. Watch as we make these analogies with finance, time, value of money and time value of carbon, return on investments, carbon returns. We need to be much more thoughtful, much more systematic. We need to bring all of these, you know, the same discipline that you use in capital budgeting. We need to bring this to this decarbonization process.

00:33:31:01 – 00:33:51:23
Gabriela Herculano
We have a big desire and commitment to be a part of that and to share our strong views on the way that we should be going about transitioning the planet and moving away from this business as usual, full of emissions to a much more sustainable place. And we are hopeful. We are very hopeful. We do think there is a gap, but we can accelerate, we can scale up.

00:33:52:06 – 00:34:11:15
Gabriela Herculano
This transition is absolutely inevitable, is going to happen because it makes economic sense. Embracing the solutions make our economies more robust. I mean, we could talk about that for hours, but that is the main source. In the end, that gives us a lot of hope. It is the right thing to do and that’s why we will be doing that.

00:34:11:15 – 00:34:19:04
Gabriela Herculano
These solutions, they are deflationary in nature. So we are very, very hopeful and we want to be a big part of this.

00:34:19:04 – 00:34:46:05
Philippa White
You’ve given me, injected me with so much hope and actually, even just from you responding to that question, I have a much better understanding of where you’re at and also where, where you’re going and how it impacts me or how I could engage. And so it’s and also just being the go to place that companies and people can go to say, okay, what is happening where things at who who is actually doing what needs to be done.

00:34:46:05 – 00:34:57:19
Philippa White
And I think that’s it’s about impact. Like you say, it’s about impact and results and where do we go for that? And that’s the thing I climate on earth. Sheila, do you want to do something?

00:34:57:19 – 00:35:17:13
Shaila Leekha
Yeah, absolutely. Exactly right. And I think, you know, looking forward, I would hope and I do think that this way of looking at forward looking at prevention of emissions is going to become more mainstream. And I think for us, we’ll constantly be looking at, well, what are the next solutions? We’ll start becoming much less of a passive sort of.

00:35:17:13 – 00:35:47:02
Shaila Leekha
These are the companies operating across these sectors to start becoming more active and saying, well, these are the companies really making a difference. So we’ll evolve. And the way that we sort of look out for those companies and the solutions, but also, you know, when you think about individuals and what they can do, not just governments who are doing a lot and we think this COP 26 was a step change it a greater business involvement and commitment greater number of countries across the world globally covering now 90% of GDP have committed to net zero.

00:35:47:02 – 00:36:02:15
Shaila Leekha
And that was a step change from before COP as well. But you know, thinking about individuals as well, what we really need to focus on, we believe strongly and we think people will start doing it in the next few years, is looking at these sort of solutions that are needed to scale. And that’s exactly what our approach does.

00:36:02:15 – 00:36:19:22
Shaila Leekha
And if you think about it, you know, that’s the only way to really do it because, you know, you can reduce emissions from what you have always done in the past, and that will be incremental. But the role of capital markets should be to back the newer innovations that the solutions that are needed, that are desperately needed and will be scaling up massively.

00:36:19:22 – 00:36:43:08
Shaila Leekha
Because you know what other choices there, you know, as the world moves towards this more sustainable path, we need to back and find those companies and those ideas that are going to be mainstays in ten years time and are either just starting or already established and scaling up now. And I think that is the biggest role the capital markets can play in this transition is to help find and back those inefficient.

00:36:43:08 – 00:36:49:07
Shaila Leekha
And so I hope what we’re doing will become much more mainstream and that we will continue to be a part of that conversation.

00:36:49:16 – 00:36:58:10
Philippa White
Yeah, I hope so too. Now we have come to the end, but before we sign off, you know what? Haven’t I asked you that you’d like to tell our listeners?

00:36:58:16 – 00:37:22:17
Gabriela Herculano
Yeah, that is a great question, I think is, you know, how can we reach the broad audience with something that sounds quite technical? Right. We’re talking about technologies, we’re talking about innovation. We’re talking about trillions of dollars in carbon returns. Right. And time value of carbon. Right. That calculate how do we make this more accessible? Almost glad that you haven’t asked that question because I we’re still working on that.

00:37:22:17 – 00:37:35:01
Gabriela Herculano
It’s not it’s easy. It ties back to that question of marketing and message and explaining things in a more straightforward way. But I think that that’s the question what else could we be doing? We should be doing? I think it’s that.

00:37:35:03 – 00:38:01:04
Shaila Leekha
Also I guess just to say that we’re constantly horizon scanning. We’re going deep in research to find the innovations, to find the technologies. But we also would love to hear from people if they have ideas. We’ve come across so many fascinating and exciting new developments, but we would love to have more of a conversation. You know, people who are interested, we have questions, we have our website, but perhaps we could post also the emails that we can be reached.

00:38:01:05 – 00:38:03:24
Philippa White
Ultimately at Twitter. I think that’s a great idea. Yeah.

00:38:04:14 – 00:38:21:04
Shaila Leekha
Yeah. And we would love to hear from people who have any thoughts, ideas, want to know more. We can give them a ton of resources because we’ve come up to speed ourselves so much in the last couple of years. And so kind of having that dialog, I would just well, throw that out there and welcome that kind of engagement from anybody who would be great.

00:38:21:05 – 00:38:43:06
Philippa White
Thank you for that and I will the right up. I will say that if anyone is keen to be in touch, I will include your email addresses and of course the link to your site. And I do urge people to get in touch. There are people who are listening who certainly are in the financial world. I do know a lot of people who are probably listening, who are in this ESG box ticking challenge.

00:38:43:21 – 00:39:02:01
Philippa White
And I think, you know, let’s take it one step further or five steps further, ten steps further to actually, it’s not about box ticking, guys. It’s not about box ticking. And as they said, you know, David Attenborough said it at the COP, the time is now and it’s it’s how you do business that is going to make a difference.

00:39:02:11 – 00:39:19:18
Philippa White
Thank you for doing what you do. Thank you for giving us some more hope. And I’m excited. I look forward to following your story. Obviously, Gabby and I did work together. Gabby was involved with Ty, so I feel a connection and I will follow the story and let’s keep in touch. Thank you both so much for joining me.

00:39:19:22 – 00:39:21:11
Gabriela Herculano
Thank you for having us.

00:39:21:18 – 00:39:23:12
Shaila Leekha
Thank you so much, Philippa. Such a pleasure.

00:39:23:16 – 00:39:43:05
Philippa White
Take care. Bye bye.

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