Inside out – An Interview with Gunung Capital
Kimin Tanoto, CEO
Kelvin Fu, Managing Partner
Meet our client who took part in Climate Impact X’s inaugural auction
Climate Impact X (CIX) completed a pilot auction of a portfolio of high-quality carbon credits in November 2021. The auction successfully cleared 170,000 carbon credits from eight recognised natural climate solutions (NCS) projects curated to form a diversified portfolio, at USD 8.00 per tonne. Each of the NCS projects, spanning reforestation and avoided deforestation initiatives – across Africa, Asia and Latin America – demonstrate the high-performance of carbon sequestration and high levels of verified co-benefits, such as supporting biodiversity, along with social and economic development in local communities.
A client, Gunung Capital, a private investment management company, was one of the participants in this inaugural auction. Gunung Capital management team’s vision is to help the world better protect the environment by investing and supporting carbon markets, encouraging adoption of decarbonization technology and related innovation, establishing carbon credits as a recognized emerging asset class, and ultimately funneling more capital into sustainable
Kimin Tanoto, CEO of Gunung Capital, said: “We are delighted to support this important auction of carbon credits led by CIX, which represents our first purchase of this vital tool in addressing global climate change as we grow our portfolio of ESG assets. We are confident that by investing in high quality carbon markets, being a responsible stakeholder, and backing climate action, we are showing leadership as an asset manager that will serve as an example for others. As a private investment management company, we are focused on impact investments guided by ESG frameworks with a vision to help the world better protect the environment.”
Kelvin Fu, Managing Partner at Gunung Capital, said: “This purchase of carbon credits marks an important milestone in our commitment to encouraging the adoption of decarbonisation technology and related innovation, establishing carbon credits as a recognised emerging asset class, and ultimately funnelling more capital into sustainable enterprises. We look forward to partnering with more global investors, institutions, policy makers, and non-governmental organizations in future.”
What is your approach when it comes to balancing your investment and sustainability journeys?
We know game-changing transformation does not happen overnight, so our approach avoids the volatility of short-term investment and provides a platform to invest in daring projects with long-term value. Through intensive due diligence, a deep bench of experienced executives, determined partnerships defined by capital, as well as experiential and operational expertise, we aim to deliver substantial returns down the road.
Can you share one highlight of sustainability journey so far?
At our steel business, Gunung Raja Paksi, which is the largest privately-owned steel group in Indonesia, we implemented a programme of change management and deep value creation in 2019. The same year, we took the company public and have been working since on a decarbonisation roadmap that we will be sharing later this year. Not only has the group become far more profitable throughout COVID, it is also far more sustainable. However, much more investment will still be needed in the years ahead to complete the decarbonisation journey that we are proud to have started.
We are now building a reputation as an asset management / private equity firm that has a consistent approach to value creation and delivers attractive returns across diversified regions, businesses, and sectors. Leveraging our experience at our own portfolio companies, we are able to support other companies in achieving their carbon reduction goals through the adoption and implementation of comprehensive emission reduction strategies and turning climate action into long term business opportunities.
What has been done with CIX
Do you intend to continue participating with Climate Impact X?
Yes, we are planning to continue participating with CIX. Our strategy has now expanded to include:
- Supporting the transition towards low-carbon projects and companies’ plans to go net-zero by providing companies with high quality carbon offsets, as well as bundling carbon offsets with sustainable products that will then go through independent certification to achieve “carbon neutral” certification.
- Investing in carbon projects directly. These projects will be across varying stages of the lifecycle of the project from initiation and validation to issuance, and they will be diversified across regions and project type.
How has DBS Private Bank helped you so far in your sustainability journey?
DBS is one of four founding members of Climate Impact X (CIX) along with SGX, Standard Chartered, and Temasek, which aims to help drive environmental impact at scale. Thanks to our relationship with DBS, we were able to complete our first purchase of high-quality carbon credits in November last year, which is an important part of our ESG investment strategy at Gunung Capital.
About Gunung Capital
This article was published in www.dbs.com.sg with the title “Starting the decarbonisation journey”. Click to read: