New article raising more issues:
Fourth: I’m surprised Finansavisen hasn’t heard about the topic of “impact investing.”
Impact investing is an investment strategy that aims to generate positive social and environmental impact alongside financial returns. The key isn’t choosing between making money and doing good—it’s about targeting both.
In that way, LPs or investors in funds align their impact and financial goals with the investment team by making sure compensation is tied not only to financial return outcomes but also to impact return outcomes.
For normal funds, impact targets are linked to their carry. For state investors without carry, impact goals are linked to bonuses.
This approach is already widespread across Europe and the Nordics. One example is Norrsken, a Swedish Impact VC founded by one of Klarna’s co-founders, links carry to impact targets. They manage €450M in AUM and their last fund was oversubscribed.
Similarly, the European Investment Fund (EIF) only invests in impact funds that tie compensation to impact goals. Actually, one of their recent impact investments is in Sarsia, a Norwegian VC fund that also links carry to impact outcomes.
A state investor responsible for generating not only financial returns but also social and environmental outcomes must link employee incentives to real and achievable impact targets.
Fifth: I am a bit worried that Finansavisen might have never heard about the gender funding gap?
Unconventional Ventures releases a yearly report measuring the funding gap for Nordic companies, showing year after year that 90% of all capital raised by Nordic companies goes to all-male teams. Or, to put it more explicitly, less than 10% of all capital raised goes to mixed teams or women-led teams.
On a fund level it also looks bad. European Women in VC also releases yearly reports measuring the gender balance among investment decision-makers. From all investment decision-makers in Nordic VC funds, only 15% are women.
There is empirical evidence that women investors are twice more likely to invest in women-led startups than their male counterparts.
And this is why it’s so important to both increase the number of women with investment decision-making power and also to ensure that state investors are incentivised and rewarded for investing in women-led funds and women-led startups.
Sixth: I really hope Finansavisen knows we have a climate crisis?
One of the main barriers to climate change prevention, mitigation, and adaptation is the amount of capital needed to move the global economy from a linear economy to a circular economy and from a carbon-positive economy to a carbon-neutral economy.
And to achieve that we need to move from a traditional perception of finance -measuring financial returns only- to a sustainable investment practice where ESG principles are truly integrated into the investment focus, process and strategy.
And yes, it matters how many emissions Investinor produced to attend Slush.
