Spotlight on Lucian Peppelenbos, Climate & Biodiversity Strategist, Robeco
Global Thought Leader Spotlight
Lucian Peppelenbos, Climate & Biodiversity Strategist, Robeco
In my role as Climate and Biodiversity Strategist at Robeco I am primarily responsible for overseeing our work on decarbonising investment portfolios and integrating climate and nature-related risks and opportunities in the investment processes. To create the backdrop for this, I was heavily involved in formulating Robeco’s policy frameworks for climate change and biodiversity, developing the Robeco Net Zero Roadmap in 2021 and the Biodiversity Framework in 2022.
My role includes collaborating with other investors, academics and policy institutions, coordinating Robeco’s extensive thought leadership and publications with the outside world. My wider background is as a sustainability specialist working for global corporations and Dutch asset managers since 1999. I hold a PhD in Social Sciences from Wageningen University in the Netherlands.
Biodiversity, what is it and why it matters?
Biodiversity for us is not a matter of protecting an exotic frog in South America or a rare orchid in Asia – important though that is. More than half of the world’s economic output valued at US$44 trillion is dependent on nature, while nature loss costs upwards of US$479 billion a year. Our own study showed that one-quarter of Robeco’s assets under management were dependent on at least one ecosystem service, while 29% of investments impacted biodiversity in some way. Protecting biodiversity is therefore not just ‘nice to have’ – it’s a matter of economic necessity.
The key investment opportunity here lies in addressing the five major causes of biodiversity loss. These are land and sea use, climate change, pollution, the exploitation of natural resources, and invasive species.
We call the solutions for this ‘bending the curve’, where we actively look at investments that can ultimately reverse biodiversity loss, while also providing financial returns for our clients at the same time.
For example, there are huge opportunities for more sustainable food, aquaculture and eco-friendly furniture; organic food alone is projected to be worth US$500 billion by 2026. The market for biodegradable packaging can reverse the single-use plastic waste tsunami, while reforestation and greener building methods also offer opportunities.
And then, of course, there is tackling climate change and the quest for net zero, which is an investment theme in its own right. The market for renewable energy, electrification of transport, carbon capture and hydrogen power defines the future.
The long-term direction is towards a global green economy. This transition is inevitable, whether we like it or not, as all this is driven by the laws of physics by which we humans must abide.
Biodiversity remains one of the more difficult arenas for sustainable investing, but investors cannot ignore the need to bend their own curve, step by step. Robeco’s Biodiversity Framework lays out the groundwork for our analysis of how well companies are doing on the transition, in order to decide on whether they should be included in portfolios.
The crusade for net zero remains a key driver, not least as biodiversity loss directly affects climate change, and vice versa. Simply aligning portfolios with the Paris Agreement can make an enormous difference, since it will directly help biodiversity, though we should also be aware of trade-offs, like with the mining of transition minerals. To navigate our journey to Net Zero 2050, we use a ‘traffic light’ system that assesses the readiness of companies towards decarbonising.
These types of analyses of whether companies are transitioning toward a global green economy is likely to become the future pathway for all investing, particularly as more stringent regulation starts to bite. Transition is the keyword here, since nobody is there yet – we are all a work in progress. We just need to make sure that there is indeed progress. That requires robust investment analysis.
Lucian will be presenting at Global Investment Institute’s upcoming Net Zero Investment Forum, taking place on Wednesday, 27 March 2024 at the Grand Hyatt Melbourne, Victoria.
To register your interest in attending, click here or for more information email zlatan.kapetanovic@globalii.com.au.
For more insights on biodiversity, please read Robeco’s most recent whitepaper, Navigating the Biodiversity Landscape - Hunting for Decision-Useful Data.
Lucian Peppelenbos, Climate & Biodiversity Strategist, Robeco
Lucian is Climate & Biodiversity Strategist at Robeco. In this role, he oversees Robeco’s work on decarbonising the investment portfolios and integrating climate-related risks and opportunities in the investment processes.
Thought leadership and publications are also part of his role, in collaboration with peer investors, academics and policy institutions. Prior to joining Robeco in 2020, he was Responsible Investment Specialist at APG Asset Management. Lucian started his career in 1999. He holds a PhD in Social Sciences from Wageningen University.
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