- Hi, my name is Daniel Oehling.
I'm a partner with BCG
and I'm here today with Fred Teo, CEO of GenZero.
Fred, Temasek launched GenZero in June, 2022
with a very specific mission.
Tell us a bit more about that.
- Temasek has imposed a double bottom line requirement
on GenZero.
That means that we have to deliver financial returns
above a certain cost of equity
and we are also expected to deliver positive climate impact.
That means that we have to be particularly thoughtful
around the carbon efficiency of our capital.
When you deploy a million dollars,
when you deploy a billion dollars,
how much impact can you actually achieve with that?
And that is the reason why I think we partnered up with BCG.
- We have been fortunate to work together
with you and your team at GenZero to develop
the GenZero climate impact measurement framework.
When we developed that framework together
there were a number of considerations
that we needed to take into account, right?
In your mind, what was the most important,
most pressing topic here that we had to take on?
- I think that the most important dimension
of our impact measurement framework
is really about being able to establish credibility.
And the reason why that is important
is because we want to be particularly sure
that the capital that we are deploying actually results
in very direct, measurable, and tangible carbon impact.
- You're not only about to deliver financial returns
but it's really also about delivering climate impact.
How does this translate
into reality on your day-to-day life?
- So there I think two parts to this.
On the one hand, you need to consider
what would be the potential carbon impact
of your investments while you're doing the due diligence,
that means this is the pre-investment phase.
And that means understanding the techno economic,
you know, potential of that particular solution.
How cheap can it be?
Is it actually scalable?
What does success look like?
If we are phenomenally successful
and we are able to get a cost down, would it be deployable?
Who would deploy it?
Who would pay?
Is it sustainable?
Then on the other hand,
we also need to think about having metrics
to be able to assess the post-investment performance, right?
So this is ongoing monitoring and reporting
of the performance of that particular investment.
So over and above financial returns
which we will all need as commercial investors
it is particularly important to understand
that for every marginal dollar that we are deploying,
that it is actually creating maximum carbon impact.
- And that's very inspiring
and we are really delightful to have been with you
on this journey and been able to make this, you know
available to the product community.
So thanks a lot again, Fred,
for your time today and looking forward to much more.