Airseed Technologies founder and CEO Andrew Walker with his tree-planting drone. Image: WWF Australia.

BUSINESS NEWS: It seems there’s quite a few start-ups throwing their hats in the ring to solve the scope 3 dilemma. 

And if you’re another start-up with a sustainability solution you need funding to develop, you will be interested to know start-ups across Australia, New Zealand and Hong Kong are being offered funding from BUPA if they can positively impact the environment and people’s health. 

Now in its second year, the 2022 eco-Disruptive program provides selected start-ups with around $40,000 in initial funding and more than $300,000 in funding for further development.

Your start-up can be anything that’s innovating around the link between people’s health and the health of planet earth, says BUPA Asia Pacific’s chief sustainability and corporate affairs officer Roger Sharp.

He says the program “aims to energise our people to work actively with start-ups to conduct research, develop business plans and share our expertise in the health and care industry.

“We want to start a movement for sustainable innovation by harnessing the passion of our people and the start-up communities across Asia-Pacific. Together we can help people live longer, healthier, happier lives and make a better world.” 

Last year Australian start-up Airseed Technologies scooped funding to further develop its drone tree planting technology.

And why we need big action on deforestation

Speaking of reforestation, some researchers have revealed the shocking driver behind tropical deforestation. Agriculture, the study published in journal Science reveals, drives between 90 and 99 per cent of all deforestation in the tropics. 

Florence Pendrill from Chalmers University of Technology, lead author of the study said: “Our review makes clear that between 90 and 99 per cent of all deforestation in the tropics is driven directly or indirectly by agriculture. 

“But what surprised us was that a comparatively smaller share of the deforestation – between 45 and 65 per cent – results in the expansion of actual agricultural production on the deforested land. This finding is of profound importance for designing effective measures to reduce deforestation and promote sustainable rural development.” 

A handful of commodities are responsible – well over half is linked to pasture, soy and palm oil plantations. 

And speaking of grain production…

Speaking of grains, Australia’s largest independent brewery Brick Lane Brewing has become B Corp certified, making it the largest of its kind in the country to do so.

They say they’re making strides when it comes to sustainability, such as directing 99.3 per cent of spent grain to farmers in the Dandenong area for use as animal feed, rather than landfill. Spent grain is the largest waste product in brewing, so we think that’s a great achievement. 

They’ve also reduced electricity consumed per unit of beer produced by more than half since 2019 and reduced water usage by 40 per cent. And this year they installed a 375 kilowatt solar project at the Dandenong site, which they claim is the largest of any independent brewer in Australia – it will save 374 tonnes of annual CO2 emissions. 

Brick Lane Brewery has achieved B Corp certification, making it the largest of its kind in the country to do so. Image: Brick Lane Brewery

Sufur based polymers created from waste 

And another exciting project is research being carried out by Professor Justin Chalker at Flinders University who has been announced as the recipient of a $1 million ARC Future Fellowship for his work sulfur-based polymers created from a combination of waste materials. This new application for the polymer will provide an eco-friendly solution to thermal imaging lenses. 

This investment into sustainability reflects a broader trend towards greening across all industries, even the big leagues. 

Fund managers are worried

Even fund managers are beginning to shake at the knees at the prospect of a potential 40 per cent collapse in asset values if carbon emissions aren’t slashed, like, yesterday. 

The chief executive of $200 billion fund manager IFM Investors last week called on Australian airports, ports, roads and hospitals to get to work on the problem, or risk empty pockets. 

David Neal, also former chief executive of the Future Fund, said at the Governance Institute of Australia conference on Tuesday in Melbourne: “You can’t stock pick your way out of systemic risks like climate change.” 

David Neal chief executive of $200 billion fund manager IFM Investors says more action is needed on climate. Image: FCLT Global.

“Healthy long-term investment returns are dependent on healthy environmental and social systems, now and in the future. The quality of investment returns in ten and twenty years’ time depends on the quality of the system in ten and twenty years’ time.”

Neal says retirement assets will incur $US7 trillion (A$10.45trn) of losses compared to an orderly transition to net zero by 2035, extrapolated from conservative European estimates from the European Central Bank. 

In the $3.4 trillion superannuation sector, housing and clean energy are top of Treasurer Jim Chalmers’ list of priorities. 

Housing still a major issue

Testament to the rising tide of the affordable housing sector, ASX-listed property owner Aspen Group has raised $36.34 million from investors in less than 24 hours to help ramp up portfolio growth in land lease and rental parks. 

Investment bank MA Moelis and stockbroker Taylor Collison helped structure and underwrite an equity raising. 

The group, which holds $452 million in assets, owns and operates 4646 affordable accommodation dwellings/sites in residential, retirement and park communities. Its investors include Singapore’s Braham Capital Management, Cooper Investors and funds run by MA Financial Group

The group’s model is aimed at households that cannot afford more than $400 weekly rent or $400,000 purchase price. It is looking at both development and mergers and acquisitions opportunities. 

And if it’s build-to-rent why not make it sustainable?

Another company hopping on the housing affordability wagon is Cundall who has released a guide that explains how ESG thinking and net zero design supports long-term financial returns in the build-to-rent sector. 

Cundall APAC ESG lead Madlen Jannaschk says that build-to-rent addresses rising issues of occupant wellbeing, quality housing creation, and rental affordability – but that any property that doesn’t have ESG at its core, the company says, will be a stranded asset in a few years’ time. 

The guide, Reimagining The Future of Home: a best practice guide for Build-to-Rent, reinforces that the global finance world is changing as capital flows towards all-electric, energy efficient and net zero developments with strong ESG credentials. 

The company hopes this will help steer developers towards the sustainability megatrend, and achieve reliable long-term investor returns – especially for the emerging Australian property asset class of build-to-rent. 

Cundall director David Collins says: “The recent announcement from the Building Ministers Forum of strengthening of energy efficiency requirements in the National Construction Code to mandate minimum 7 Star NatHERS for residential buildings is a clear signal that the industry needs to aim high for quality and performance.

Cundall director David Collins says the industry needs to aim higher or be left with stranded assets. Image: Cundall

“In coming years, as the wider economy progresses further towards full decarbonisation, we can expect further uplifts to minimum performance standards. What this means for build-to-rent projects is they need to aim for better than code minimum, or owners and investors may find their assets are stranded within 10 years or even sooner.

“If BTR aims to provide a long-term and reliable income stream for operators and their stakeholders, the prospect of needing major retrofits in the near future should raise some major risk flags.”

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