Fresh out of the studio, Ravi Chidambaram, CEO and founder of RIMM, joined us in a conversation to discuss ESG and climate adaptation investing across Asia Pacific. Ravi explained the current paradigms in the ESG space and dived deep into different topics such as climate change, water scarcity and carbon credits and where technology is leading. Last but not least, he provided the value proposition behind RIMM and how it helps companies from different sectors to do ESG reporting and aggregates the data for analytics and machine learning.
"I think from an investor perspective, the biggest misconception would be to buy into a high score and think the company is truly sustainable because the reality with ESG is the data is self-reported. The data often is limited in terms of the range of disclosures. It's very selective. It's very manipulative because large companies with big CSR or sustainability departments, Can often manage the narrative around ESG better than smaller companies. There are a lot of geographic biases: developing countries tend to get poorer ratings and are usually penalized with a corruption or transparency type discount." - Ravi Chidambaram
- Ravi Chidambaram, Founder & CEO, RIMM and co-founder of TC Capital (Linkedin)
- As a first time guest on the show, the first question is always the origin story. How did you start your career?
- You have been in the investment banking sector in M&A for a very long time first with Bear Stearns and then with TC Capital which you co-founded. What are your key learnings within that industry?
- One side gig you have is that you are an adjunct professor teaching sustainability in the Yale-NUS college which will be transitioned to the NUS college. Can you talk about how you bring the industry thinking to your students with regards to sustainability?
- In your career journey, what are the interesting lessons which you can share with my audience?
RIMM, ESG and Investment in Climate Adaptation
- Reference: “It’s time to invest in climate adaptation” by Parag Khanna and Ravi Chidambaram
- To start the conversation, we often hear about the concept of Environmental, Social & Corporate Governance or ESG in short. Can you explain the concept of ESG and how ESG has percolated into company practices today?
- Let’s take an example, companies are trying to reduce carbon footprint by using carbon offsets and yet worldwide sequestration of carbon is less than 1%, how does carbon offsets (or carbon credits) work for companies?
- Given all the different initiatives from governments, companies and non-profit organizations to take on climate change with their aim to go net zero by a certain date (and the goal’s aspirational and not a hard target), what are the realistic scenarios that we are going to see in our lifetime?
- What is climate adaptation and why should we invest into it right now?
- To dive deeper, how does climate change affect agriculture? Can countries still leverage on insurance to hedge against the corps yields every year?
- What about water scarcity? Are there examples of companies deploying measures from technology to policies that will resolve these issues?
- Given that I am in construction and real estate, I like to hear your thoughts on how the industry as a whole thinks about the build environment. Are there initiatives to think about housing for the next billion of people and also reducing carbon footprint?
- A technology question, what are your thoughts on companies deploying blockchains to track and trade carbon credits?
- What should be the mental models for companies to think about ESG?
- Elon Musk has recently challenged how ESG is measured by the MSCI. What are your perspectives on how we should think about measurement of ESG by companies?
- What are the common misconceptions on ESG which people are getting wrong?
- I have observed some companies that are focused on the reporting of ESG, and some on trading water and carbon credits. How do you look at the startup space in the ESG?
- That comes to one of your current gigs, RIMM, a sustainability platform, what does RIMM do and how does it work for companies?
- What are the services that RIMM provides for customers beyond the platform, for example, consulting with companies in specific sector out there to help them figure out the ESG roadmap?
- How do companies leverage on RIMM to develop and deploy their ESG strategies? Can you give an example of how the management team can use it to track their sustainability efforts?
- What does great look like for RIMM in the next 3-5 years?
- Any recommendations which have inspired you recently?
- Ravi's recommendations: 1/ Regenesis: How Synthetic Biology Will Reinvent Nature and Ourselves by George M Church and Edward Regis and 2/ The Dawn of Everything by David Graeber & David Wengrow.
- How can my audience find you?