Venture Capital: Venture Capitalist Firms Form UN-Backed “Venture Capital Alliance (VCA)”

Several of the biggest VC funds worldwide, such as Tiger Global, have joined VCA as members.

The Venture Capital Alliance (VCA) has launched with more than 20 VC firms as members, including Tiger Global and Union Square Ventures, with the goal of encouraging the VC industry to increase commitments to climate tech.

The VCA has laid out guidance for members and portfolio companies to ensure they meet requirements to achieve net-zero emissions by 2050, with the stated aim of using “methodology and metrics” to determine what makes a good climate investment. (CNBC)

Portfolio firms will be given guidance to decarbonize operations, for example by using emission-free data centers, less energy-intensive software and low-carbon supply chains. Generalist VCs must make routine assessments of their carbon footprint and align early-stage bets with net-zero goals.

Venture capitalists focused on climate change who participate in the VCA must ensure that the technologies they invest in have the capacity to reduce carbon dioxide emissions by a minimum of 100 megatons.

The VCA has been approved by the United Nations as part of its Race to Zero campaign, and falls under the Glasgow Financial Alliance for Net Zero.

Climate tech investment has declined compared to last year, with fintech attracting $79 billion and the climate tech sector raising $50 billion in 2022, a 10% drop on the previous year.

Related Story:  Healthcare Of Ontario Pension Plan (HOOPP) Unveils Climate Plan For Achieving Net Zero In Its Portfolio By 2050

Image by Gerd Altmann from Pixabay

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