About episode
There are likely only a few people who know more about impact investing than John Goldstein. His firm—Imprint Capital—helped pioneer the field before getting acquired by Goldman Sachs in 2015. Now, John is the head of Goldman’s Sustainable Finance Group, offering him a truly unique perspective on the trillions of dollars needed to finance decarbonization and conservation globally.
In this episode of Invested in Climate, we talk about the work that John does, how investing in climate has evolved in recent years, and why now is the time to invest. If you’re investing in climate or curious about getting started, don’t miss this episode.
In Today’s Episode, we cover:
- [2:43] The purpose of the sustainable finance group
- [7:44] The clients they serve and the scale they operate at
- [9:00] What led John to the position he’s in today
- [16:03] Why now is the time to invest in climate
- [22:07] Quantifying the impact of investments
- [26:49] Why we’re in a new chapter of ESG investing
- [31:31] The investment opportunities available
- [32:55] Can divestment have an impact?
- [34:08] Think like an analyst—not an advocate
- [42:43] How everyday people make an impact
The purpose of the sustainable finance group
Goldman Sachs has a long history in environmental and social issues. They had an environmental framework in 2005. They’ve been carbon neutral since 2015. They’ve also made important climate investments.
In 2018, something qualitatively different began to emerge. They saw a diverse interrelated persistent set of drivers that meant that climate transition and inclusive growth were accelerating themes in the economy and the markets.
Once they had that clarity, they needed to take action. So they decided to drive the development of expertise on the subject matter. How do you harness that to get a behavioral view of the world as it is and where it’s going? They work to mobilize that knowledge.
Once you have knowledge, you need to translate it into products, services, and capabilities to deliver to clients. They have large global clients with a variety of needs, interests, challenges, and opportunities. The goal is to identify where they are, have clarity about where they’re going, and shorten the distance between point a and point b.
They have 4 basic businesses:
- Investment banking
- Global markets
- Asset management
- Consumer wealth
How do they keep each of them on the cutting edge in terms of products, services, and capabilities? The sustainable finance group was launched with that as the mandate. It’s figuring out how to drive expertise, translate it into capabilities, and deliver it across the global client base.
What scale do they operate at? Listen to find out the impact they’re making!
What led John to the position he’s in today
John got a call at 11:45 in the morning from his boss, who asked him to go to a meeting with the Canadian Prime Minister and the head of the UNDP. It was in this meeting that he realized that important people trying to solve problems that matter were struggling.
He began to question how to adapt the market and investing toolkit to a social and environmental purpose. He points out that once you encounter that question, there’s no going back. It became a captivating force for John that led to move to the west coast.
Taylor Jordan, the CIO of the Rudolf Steiner Foundation, had built a 100% mission-aligned investment portfolio. Imprint Capital started when John and Taylor decided to work together. They became the go-to experts in their field. They built a business around deep research and institutional investment processes.
In 2013, some of the largest financial institutions in the world called and asked them for help. They spent more time in New York and got to know Goldman Sachs in 2014. Goldman Sachs asked to buy them out. They started the business to move more money impactfully, do it well, and make it accessible to more people. So they agreed to get acquired.
Why now is the time to invest in climate
Important companies and people are making net-zero commitments, which reverberates across the economy. John points out that there are 5 main growth themes in climate:
- Clean energy (generation, transport, storage, and efficiency)
- Sustainable transportation across the value chain
- Sustainable food and agriculture
- Waste and materials (circular economy)
- Ecosystem services
The themes went from being obscure to being mainstream, attracting significant volumes of capital. Massive economic transformations of huge systems like energy are not simple nor linear. Energy transition will look more dynamic, adaptive, and complex.
What does it mean going forward? Who is going to adapt and win in a changing environment? The reality is that success is going to take specialization, expertise, skill, research, and depth to give you an edge.
As the world navigates energy transition, high and volatile energy prices make efficiency a great investment. We have a supply/demand imbalance in energy. John emphasizes that we need energy that’s affordable, reliable, and green.
Can you quantify the impact of your investments? What investment opportunities are available to everyday investors? Can divestment have an impact? Listen to hear John’s thoughts about these important topics.
Resources & People Mentioned
Connect with John Goldstein
- Connect on LinkedIn
Connect With Jason Rissman
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