The Deep Transitions Newsletter puts one member of the Global Investors Panel in the spotlight each month. Issue #3 of our newsletter features Sanjoy Sanyal who is Senior Advisor for the Environment & Sustainability portfolio at Caspian. Sanjoy told us more about his aims and ambitions with the panel and where he sees the biggest obstacles in making sustainability and transformation leading criteria in the finance sector.
Sanjoy, why did you decide to join the Global Investors Panel?
“I joined the panel on behalf of Caspian Debt, India’s leading impact investor in the area of climate related investing. A lot of investment activity is reactive to the types of opportunities that innovators and entrepreneurs present. The idea of taking a “systemic view” of visualizing a future (with analytical rigor) and then thinking of how money can help bring that future about is extremely ambitious, and we wanted to be a part of that endeavor. The other reason to join the panel is that, as impact investors, we are conscious to share our learnings very actively with others in the community and actively learn from others in the field. It is a tough business, and we appreciate the opportunity of interacting with peer investors from around the world.”
What would you say are the biggest challenges in sustainable finance?
“First, there is an issue of market failure. Tons of money are available but relatively few “bankable projects” related to system change. This is a complaint among investors of all types. Typically, entrepreneurs would counter it to say that “you do not invest in early-stage deals”. The real problem is that markets for sustainable products and services are not ready. The strong linkages between buyers and sellers to experiment, test and ratify sustainable products have not been established. One reason for this is that the financial cost of using sustainable products is often higher than using conventional products. Another reason is that consumers take time and proof to start using new products and we are far from “tipping points” where markets accelerate.
Second, the structures of Venture Capital (VC) investing models which dominate investing in early stage cleantech deals – even used by equity impact investors – is not appropriate. Increasingly, VC investment deals mean pumping in ever larger amounts of capital in winners. This means that various alternate approaches cannot be tested and that investing in sustainability perpetuates social inequalities which prevent the broad social and economic transformation of society.“
What does the success of Deep Transitions Futures and the work with the Panel look like for you?
“To me the success of the project should have the following two characteristics: It should enable some strategic reorientation of organizations involved into this “deep systematic transformation” framework and foster collaboration between parties to test ideas and create learning experiments. This should lead to frameworks, tools, learning paradigms for investing organizations of various types and have influence in the way managers do their day to day tasks. This should provide a practical input for “net zero” investing programmes.“
Read more about Sanjoy Sanyal and the Global Investors Panel. Subscribe to our newsletter to stay up to date about Deep Transitions Futures, publications, news, and events. To join the conversation follow @DTransitions2 on Twitter and connect with us on LinkedIn.
