Starting the Decarbonisation Journey

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?

我们的投资方法来自于将自有资本投资于开发和运营所收购资产的实际操作,以及为着手的任何项目提供综合解决方案以实现净零目标会有多么重要的充分理解。

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.

我们的投资团队将有效监督整个投资过程,帮助改善商业生态,建立良好的公司治理体系,让所投公司运行在正确的轨道上,能够取得成功、获得回报、实现业绩。在确保我们的目标与联合国可持续发展目标一致的同时,我们的团队会对所投公司的各个方面,不管是管理、招聘,还是企业文化或绩效考核,进行分析、计算,给出促进业务增长和持续发展的见解。

我们的投资方式和方法应用于整个价值链,通过在不断的服务中识别、量化和交付价值,以此部署技术和工具来增加收入或降低成本。不论是交易发起、密集的尽职调查,还是现金水平改善和资产效率提升,我们的主要目标是为公司、合作伙伴、投资者、股东和社区优化长期的财务、社会和环境价值。

我们拥有在印度尼西亚、中国、欧洲和美国等市场开展投资的丰富经验,在错综复杂的政治、社会和文化环境中如鱼得水,也因此拥有进入各个市场的渠道,在这些地区搭建起了广泛的人脉,并拥有一支接受过全球顶级教育、精通多种相关语言、熟稔国际商业文化和管理技能的队伍。

我们具备制造业和业务建设的背景,也因此对价值链以及把握价值链各个方面的重要性有着独特的理解,在印度尼西亚市场尤其如此。对于可行的端到端解决方案和负责任的管理,我们保持对项目所有环节的战略监督和把控。

我们支持通过采用和实施全面的减排战略来实现碳减排目标,将气候行动转化为全球各个组织的长期商机。在整个公司范围内,我们制定了适当的政策和流程来确保取得长期成功,并能维护利益相关者的利益。

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:

  1. 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.
  2. 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

Gunung Capital是一家私人投资管理公司,专注于由环境、社会和治理(ESG)框架指导的影响力投资。管理团队的愿景是通过投资和支持碳市场,鼓励采用脱碳技术和相关创新,建立碳信用额作为公认的新兴资产类别,并最终将更多资本注入可持续发展企业,帮助世界更好地保护环境。

Gunung Capital与全球投资者、政策制定者、非政府组织、大小企业密切合作,致力于应对气候变化,并使未来的转型资本流动更加无缝和高效。

This article was published in www.dbs.com.sg with the title “Starting the decarbonisation journey”. Click to read:

https://www.dbs.com.sg/private-banking/articles/esg/starting-the-decarbonisation-journey

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