VentureESG Community Newsletter
June 2024
Welcome from the VentureESG Team!
Welcome to VentureESG’s quarterly newsletter! If you are new here, we’re excited to have you with us. This newsletter is your go-to source for the latest updates and resources from our team and community on everything ESG and responsible investing in venture capital.
In this issue, we provide more information about our FRAME conference, highlight the publication of our materiality napkins, and share other news from the community, including the most recent ESG and impact reports!
Welcome to our new members
A special welcome to the recent new joiners to our membership:
2bX, Airtree, Birchway Capital, daphni, DN Capital, Form Ventures, GSB Capital, Karma Ventures, NATO Innovation Fund, SoftBank Investment Advisers, Transition VC and VEF VC.
Being a VentureESG member gives you exclusive access to all of our events and resources, including those marked [members only] below. Find out more about joining our membership of over 140+ VC funds worldwide below!
A new and unique VC community conference
As summer is upon us and calendars for the rest of the year are getting booked up, we wanted to remind you of FRAME, the conference we are hosting in London on 19th September at 180 The Strand.
FRAME is a community conference exclusively for VCs and LPs to inspire more collective engagement around ESG and responsible investing in venture capital. It is the first global conference dedicated to ESG in venture capital, and the first time we’re bringing our global community together in one room!
We have an exciting agenda planned - here's a glimpse of what you can expect:
🚀 Sector-specific 'safari’ breakfasts hosted by VCs and LPs, including Balderton, BII, Albion, Atomico amongst others
🚀 Lightning speeches from experts on AI, ESG, DEI and Climate & Sustainability
🚀 Panels with leading GPs and LPs, including Paul Murphy (Lightspeed Venture Partners), Marie Ekeland (2050), Rainer Märkle (HV Capital) and Maya Horgan Famodu (Ingressive Capital)
🚀 Roundtables tackling specific issues and functions, hosted by our VC and LP community, including Base10, Cusp Capital, the British Business Bank, Diversity VC, Dawn Capital, Better Society Capital and others
🚀 An Oxford-style debate arguing for/against the motion: ‘VC needs more ESG'
🚀 The ESG Game
Find out more information about the agenda, speakers, co-hosts, sponsors, and more on the FRAME website - and apply for a ticket ⬇️
A big thank you to all our amazing sponsors who make FRAME possible for us as a non-profit: White & Case, Nasdaq, Base10, Dasseti, BMW Foundation Herbert Quandt, Atomico, HV Capital, Cusp Capital, The Westly Group, Google Cloud, Apiday, Novata, Metric & Kara!
🔧 New tools & resources to make your job easier
Materiality Napkins for Venture Capital
ESG is not ‘one size fits all’ but needs to be tailored to a company’s sector, business model, and funding stage. In our recently-released White Paper, we are introducing a new, VC-specific ‘ESG DD materiality-filtering tool’ that gives VCs an efficient starting point to zoom in on a sector’s top ESG priorities. For a start, we produced these ‘materiality napkins’ for 5 sectors, from climate- and consumer-tech to Fintech and SaaS. The tool was also kindly sponsored by Atomico, and was developed by speaking to over 60 VC ESG managers and sector-specialist VC investors.
Emerging Markets: towards fit-for-purpose ESG tools
In the first output from our partnership with leading European development finance institutions BII and FMO, we have developed a tool to serve as an ESG due diligence framework for VC fund managers operating in lower- and middle-income countries. The comprehensive DD resource (and the accompanying white paper) covers 8 key areas for incorporating ESG into investments, tailored to the unique contexts of emerging markets, with customisable filters for different materiality considerations. On July 3, we are launching a specific emerging markets community. Email zecheng@ventureesg.com if you are interested to learn more/ join.
Dual-Use and Defence Tech Guidance
The conversation around dual use and defence tech in VC is only growing. For this project, we released a white-paper exploring the state of dual-use in VC and subsequently developed an ESG framework for dual-use investments, interviewing 46 VC investors, LPs, and ecosystem experts across the UK, Europe, and the US in the process. Our conversations focused on current challenges with dual-use investments, especially from an ESG/ responsible investing perspective and with a strong focus on Europe. This led to the development of a sector-specific ‘Universe of ESG Issues’. a first-of-its-kind due diligence framework for dual-use and deep tech for VCs and asset owners.
How to deal with an (ESG) incident (on Medium)
Unforeseen incidents, related to ESG broadly defined, in the portfolios of VC firms are common; appropriate responses to such incidences such as fraud or sexual harassment, controversial products, or labour issues are not always clear. With the help of our community, we’ve put together this process-focused document to enable the establishment of ‘better practice’ across the ecosystem.
How the Best in Venture Capital are Nailing ESG Due Diligence (on Medium)
ESG due diligence is a standard part of many VC investors’ due diligence, with LPs increasingly demanding ‘evidence’ as part of their initial diligence or ongoing reporting. In this first collective blog post, we collected 12 best practice examples of how to do ESG DD - thank you to all those who contributed. More community-led examples of best practice ESG to come!
The VentureESG team is growing
Welcome, Mo, to our team…
Our new project on unearthing the ‘101 of material environmental factor integration’ for VCs and portfolio companies has kicked off and Mo has joined us to lead this work. We’re very grateful to Atomico for funding this piece and are looking forward to the new guidance!
…and help us find another research fellow!
We're hiring another Research Fellow - this time to tackle the much-needed topic of ESG integration in Start-up and Scale-up boards!
The regularity of board meetings and the decision-making ability of board members presents a unique opportunity to raise the ESG conversation and drive forward material ESG action points and accountability. In partnership with VentureESG member, Balderton Capital, this project will build on existing industry startup board guides, and go one step further in specifically tackling the subject of ESG in that context.
If you or anyone in your network are interested, please send them our way or apply by sending a short cover email, and your CV to hello@ventureesg.com
We are always looking for more insights from our community! Get in touch and we can talk about how you could contribute to our Medium.
Leading in ESG Training
The training programme developed by VentureESG, KfW Capital, and the BMW Foundation continues to expand. Since March, we have delivered training in London and Helsinki and have another session booked in London in July. Later this year, we’ll be coming to Toronto as well as returning for sessions in Germany and the UK.
To learn more about the programme, please visit leadinginesg.com or submit your interest here.
NEW: Emerging Markets Community
With an online launch on July 3, we are expanding our work on emerging markets. This new VC community is dedicated specifically to working together with our partners BII, FMO, and GIZ on meaningful ESG integration among VC funds in Emerging Markets. Read our first outputs - the white paper and DD tool!
As part of the community, we are launching a free Notion knowledge database and hosting quarterly emerging market-focused calls. We will also report back from our trainings across LatAm and West Africa in partnership with GIZ.
If you are interested in joining, email zecheng@ventureesg.com!
Upcoming VentureESG Events and Conference
⭐️ July
ESG Community for Emerging Markets VCs | Online | Jul 3 | All are welcome
Deep Dive: Doing ESG and impact in healthcare VC | Online | Jul 11 | VC Members only
Insights: US ESG Sentiment | Online | Jul 16 | Public online event
VentureESG Quarterly LP Community Call | Online | Jul 25 | LP Community only
VentureESG - Quarterly Membership Call | Online | Jul 31 | VC Members only
💫 August
Portfolio Support Working Group | Online | Aug 7 | VC Members only
Quarterly LP Working Group | Online | Aug 28 | LP Community only
✨ September
Dual Use Working Group | Online | Sept 10 | VC Members only
Heads of ESG Working Group | Online | Sept 10 | VC Members only
Emerging Manager Emotional Resilience Workshop | London | Sept 18 | Invite-only session
VentureESG x Invest Europe x Project Liberty LP Workshop | London | Sept 18 | LP Community only
Pre-FRAME Dinner | London | Sept 18 | Invite only
FRAME by VentureESG | London | Sept 19 | registered VC and LPs only
Pre-IPO Readiness Working Group | Online | Sept 26 | VC Members only
Join Our Groups: We host regular [members-only] meetings for Heads of ESG, as well as working groups on portfolio support and pre-IPO readiness. Please let us know if you want to join.
Have an event idea?
Whether it’s tackling challenges challenges or exploring relevant topics - your input is invaluable. Feel free to share your suggestions by emailing us at hello@ventureesg.com
VentureESG was on the road (a lot)
In the last quarter, we have put on a number of events from working groups to deep dives. Here are some of our highlights:
Our events keep driving the ecosystem: our May DeepDive on ESG on boards with Paul Morgenthaler (CommerzVentures), Tess Dury (Extantia Capital) and Reece Chowdhury (Concept Ventures) [Link to recording, members-only] led to the start of our new research project; similarly, our Insight session on Responsible investing in dual-use technology with Hugo Jammes (NSSIF), Brooke Latham (Nato Innovation Fund), Paul Kwan (General Catalyst), and Bernadette Johnson (MIT Lincoln Lab, formerly NATO DIANA) [notes on Notion, members-only] has produced further engagement - more on that front soon!
As every year, SuperVenture week in Berlin in early June is a big week for VentureESG. We ran MainStage panels on responsible investing and DEI, LP and VC boardrooms and ESG and co-hosted two dinners with Base10 and Lowercarbon. Great to meet everyone in Berlin!
Already in April, we organised a little German VC ESG Symposium with High-Tech Gründerfonds at the BMW Foundation; it showed us once more that the ‘German chapter’ of VentureESG is very strong and well connected (coming through again at the CUSP/HV Capital drinks during SuperVenture in June)!
News, Events & interesting reads from us and the Community
📄 News from and with the VentureESG team and broader community:
Fast Company: The war on ESG doesn’t make sense. Least of all for tax payers
Our co-directors Johannes Lenhard and Hannah Leach explain how the continued backlash against ESG integration in investing is frustrating - and why they are still very hopeful.
ImpactAlpha: Why VC investors need a 1.5°C goal for responsible tech
Together with our new partner Paul Fehlinger of Project Liberty, our co-director Johannes argues for the need for clearer process and goals for responsible VC.
Fast Company: What we lose when we cut D and E from DEI
To combat the bigger backlash against ‘woke capitalism,’ including the broader ESG agenda, one ‘solution’ has been to use different words. Our co-director Johannes argues why that won’t work.
New podcast: Driving the adoption of ESG in the VC industry
Listen to Johannes talk about the mission and future goals of VentureESG, the importance of ESG, and address why the social and governance aspects often receive less attention and more.
Many of our members have released impact and ESG reports recently:
Members can access more industry ESG & Impact reports on the Notion!
British International Investment x FMO: The monitoring challenge - how to maintain good governance and oversight post-dilution: This guidance note presents proactive approaches for investors in startups, including VC fund managers, to continue to ensure appropriate oversight and shape good governance even when their influence wanes.
Diversity VC Diversity Data Alliance: We joined the first UK-meeting of the Diversity Data Alliance led by Diversity.VC in June. Major LPs and ecosystem organisations are coming together in order to harmonise DEI data collection. Find more information on the alliance which has already made good progress in the US.
Icebreaker One: Carbon reporting solutions for UK SMEs: This report, sponsored by the British Business Bank, offers a comprehensive and impartial review of carbon reporting solutions for UK SMEs.
Pitango ESG & Impact Knowledge Hub: This info page from our long-standing members, Pitango VC, aims to help you get acquainted with the worlds of ESG and Impact through the lens of a generalist venture capital - it contains some useful (and portfolio-facing) resources
World Economic Forum x CPP Investments Insights Institute: Responsible AI Playbook for Investors: This white paper from WEF explores the important role of investors in accelerating the adoption of responsible AI.
Responsible technology: A path towards an ethical innovation ecosystem: Project Liberty and Aspen Digital convened 150 experts from all sectors and five continents in 2023, tacking the question of how to advance frameworks for the ethical development of emerging technologies - read insights and recommendations here.
ESG_VC survey results: Our friends from ESG_VC did a survey on responsible VC in the UK - their results are promising and showing good progress!
European Women In VC with Founders Form Group and Tech Nation: Beyond Returns: Venture and Growth Fuelling Sustainability & Societal Change: This new report helps us understand better what drives investment decisions of various types of institutional investors and what are the possible reasons behind their reluctance to engage in VC.
Pitchbook Responsible Investing Survey: The annual Pitchbook Responsible Investing survey is running - please consider spending the 5 minutes to fill it in!
iiF Conference by i³ investing: our friends over at i³ investing are hosting a first-of-its-kind (un)conference to highlight the lack of intersectionality in capital allocation for Founders, Funders, & Friends on 16 July at Google HQ in London. This event will include 150+ queer & migrant tech founders, alongside 75+ top VCs, Angels, and LPs.
The WVC:E Summit 2024: The wonderful WVCE and team are returning to Paris on October 7-8 with their conference, exclusively for women in venture capital. It’ll feature open discussions, workshops, and roundtables on key themes with top industry names - women (and male allies!) - check out tickets here.
Get in touch!
All community members can access a free version of our Resource-Notion after attending an information call. VentureESG members, remember to join our WhatsApp group and explore the Members Resource Bank on Notion.
If you're interested in learning more about VentureESG, register your interest here. For any further questions, feel free to contact us at hello@ventureesg.com!
The VentureESG team
Hannah, Johannes, Denise, Danika, Oliver, and the whole team
