Finance

Triodos Bank just launched a €300 million fund that treats nature as a profitable asset class. Not a charity. Not an offset. A return. This has been years in the making. In 2024, Triodos Bank and Fondaction - a Canadian investment fund - announced a partnership with the explicit intention to jointly accelerate positive change in global finance. The goal was clear from day one: close the finance gap for biodiversity and natural capital in developed markets. Last month, that partnership became a fund. Triodos Investment Management and Fondaction Asset Management have launched Value Nature Fund I - a closed-end natural capital fund targeting €300 million, aimed at transitioning farmland and forests to regenerative, closer-to-nature practices across North America and Europe. The fund brings together Fondaction's expertise in impact-driven investments in North American environmental markets. And Triodos's track record in European sustainable food and agriculture systems. Two complementary networks. Two continents. One investment thesis. The financial case is explicit: The firms say the fund comes at a moment of unmatched opportunity - creating value from the transition towards sustainable food and timber supply chains, hedging portfolios against volatility and inflationary pressures, and enhancing the resilience of critical economic sectors. This is not the language of philanthropy. It is the language of a portfolio manager. The fund intends to classify as SFDR Article 9 - the EU's most stringent sustainable finance label - with measurable impact KPIs across biodiversity and ecosystem services, climate mitigation and adaptation, and social wellbeing. Performance is tracked and outcomes are reported. Jonathan Coupland, Portfolio Manager at Fondaction, put it plainly: "Natural capital represents a structural response to ecosystem degradation, helping institutional investors address financial risks that can no longer be overlooked." That sentence matters. Not a values statement. A risk statement. The partnership's founding ambition was to demonstrate the scalability of solutions that address the dual climate and biodiversity crises with integrity - and that can achieve both financial performance and positive outcomes for nature. Value Nature Fund I is that demonstration. At €300 million scale. The question for every institutional investor watching: if Triodos and Fondaction see unmatched opportunity in natural capital and can build the vehicle for it - why not you too?

Energy is once again dominating headlines all over the world. Gas and oil prices are volatile, key shipping routes face geopolitical pressure, and policymakers are concerned about supply risks. The renewed uncertainty is a reminder of an uncomfortable reality: the next energy crisis isn’t an if – it’s a when, and a question of how prepared we are. A defining challenge of this decade, and one that now feels more urgent than ever, is how to build a resilient energy system. One that minimises structural dependencies and is designed for rising electricity demand. The imperative of our time: The more we electrify, the less we import fossil fuels. The less we import, the more resilient we become. The course of action is clear: ▪️ Relentlessly scale renewables: Slowing the buildout will not reduce costs. Quite the opposite – delay compounds system costs for the entire economy. ▪️ Fix the grids: As fast as possible, as efficiently as possible, and at the lowest possible cost. Before they become even more of a bottleneck. ▪️ Secure 24/7 electricity supply: When the wind isn’t blowing and the sun isn’t shining, renewables need reliable backup in the form of battery storage and hydrogen-ready gas fired power plants. But gas should serve only as a backup, with renewables and batteries reducing its utilisation. ▪️ Reduce gas supply dependence with infrastructure and diversification: We must not replace old dependencies with new ones. Diversification of gas supplies is key. And the physical prerequisite is an import infrastructure with buffers. We need the planned LNG terminals, complemented by a nationally held gas reserve to help ensure secure supply in winter. ▪️ Electrify everything that makes sense: The more we can power with mostly homegrown electrons, the less dependent we become on fossil imports. Other energy import-dependent countries like Japan and China have electrification rates that are around 10 percentage points higher than Germany’s. This shows where the path forward lies. Electrification reduces reliance on imported fossil fuels, which in turn strengthens overall resilience. The time to act is now.

Last week, China barred its major tech companies from buying Nvidia chips. This move received only modest attention in the media, but has implications beyond what’s widely appreciated. Specifically, it signals that China has progressed sufficiently in semiconductors to break away from dependence on advanced chips designed in the U.S., the vast majority of which are manufactured in Taiwan. It also highlights the U.S. vulnerability to possible disruptions in Taiwan at a moment when China is becoming less vulnerable. After the U.S. started restricting AI chip sales to China, China dramatically ramped up its semiconductor research and investment to move toward self-sufficiency. These efforts are starting to bear fruit, and China’s willingness to cut off Nvidia is a strong sign of its faith in its domestic capabilities. For example, the new DeepSeek-R1-Safe model was trained on 1000 Huawei Ascend chips. While individual Ascend chips are significantly less powerful than individual Nvidia or AMD chips, Huawei’s system-level design to orchestrate how a much larger number of chips work together seems to be paying off. For example, Huawei’s CloudMatrix 384 system of 384 chips aims to compete with Nvidia’s GB200, which uses 72 higher-capability chips. Today, U.S. access to advanced semiconductors is heavily dependent on Taiwan’s TSMC, which manufactures the vast majority of advanced chips. Unfortunately, U.S. efforts to ramp up domestic semiconductor manufacturing have been slow. I am encouraged that one fab at the TSMC Arizona facility is operating, but issues of workforce training, culture, licensing and permitting, and the supply chain are still being addressed, and there is still a long road ahead for the U.S. facility to be a viable substitute for Taiwan manufacturing. If China gains independence from Taiwan manufacturing significantly faster than the U.S., this would leave the U.S. much more vulnerable to possible disruptions in Taiwan, whether through natural disasters or man-made events. If manufacturing in Taiwan is disrupted for any reason and Chinese companies end up accounting for a large fraction of global semiconductor manufacturing capabilities, that would also help China gain tremendous geopolitical influence. Despite occasional moments of heightened tensions and large-scale military exercises, Taiwan has been mostly peaceful since the 1960s. This peace has helped the people of Taiwan to prosper and allowed AI to make tremendous advances, built on top of chips made by TSMC. I hope we will find a path to maintaining peace for many decades more. But hope is not a plan. In addition to working to ensure peace, practical work lies ahead to multi-source, build more fabs in more nations, and enhance the resilience of the semiconductor supply chain. Dependence on any single manufacturer invites shortages, price spikes, and stalled innovation the moment something goes sideways. [Original text: https://lnkd.in/gxR48TK8 ]

Pay attention: this is the most important macro chart in the world. Foreign Central Banks have been sending a clear message to US policymakers: we intend to diversify away from the US Dollar. The chart below shows the % of total foreign exchange reserves held in USD (blue), EUR (white) and gold (orange). There seems to be an already ongoing diversification away from USD as the key currency for FX reserves into other alternatives – primarily into gold. But why, and should you be worried about it? 1️⃣ The weaponization of Russian USD FX reserves woke up several other Central Banks to the reality - reserves invested in USD assets are your assets only until the US says so, otherwise they are gone; 2️⃣ The Trump administration intends to change the global trade system, and policies like tariffs reduce the appeal of US assets. For decades, we lived in a world where foreign countries exported into a strong US consumer economy, and recycled back the proceeds into US assets - often T-Bills and US Treasuries. Some countries like Norway or Switzerland went as far as deploying their USD reserves into US equities: decision which led the Norwegian Sovereign Wealth Fund to deliver strong returns. But recently the winds have changed. Global Central Banks are rapidly diversifying their FX reserve buffers away from the USD and into Gold. And the EUR could be a winner too. Now that Germany and Europe have opened up their fiscal purse, there will be much more AAA-rated EUR bonds where foreign investors can park their excess reserves. Couple that with a growth impulse from fiscal spending, and more capital could flow towards Europe. In any case, this is a crucial macro trend to watch. Agree or disagree? 👉 If you enjoyed this post, follow me (Alfonso Peccatiello) to make sure you don't miss my daily dose of macro analysis.

In Case You Missed It: The World's Largest Asset Manager, BlackRock — Private Markets Outlook 2025 🏆 With industry estimates projecting the industry to reach >$20T by 2030, private markets has quickly become one of the hottest areas in finance. From private credit, private equity, infrastructure and real estate, here are the key takeaways from BlackRock's 2025 outlook titled "A new era of growth": • Outlook: The brightest days for private markets are still ahead, driven by higher investment activity, elevated-but-lower financing costs and greater demand for long-term capital. • Industry estimates: project private markets could grow from $13T today to more than $20T by 2030 - they believe private debt and infrastructure will grow the fastest. • Private debt: continues to expand globally, and into new avenues of finance, with wide performance dispersion depending on borrower size and sector. • Opportunity in AI: Investors can access the transformative possibility offered by artificial intelligence through infrastructure, as well as debt, private equity and real estate. • Key drivers: A series of profound changes in the world’s demographics, energy demand, digital technology and supply chains continue to propel investment across private markets. • Deal activity: is rising in both the M&A and IPO markets, which should drive more exits and distributions across private equity. • Real estate: valuations are nearing their bottoms, creating opportunities, though price recovery will take time, with wide dispersion among sectors and regions. What is driving the rapid and continued expansion of private markets? Companies staying private for longer: • The median time a “unicorn” stays private is 10.7 years, up from 6.9 years in 2014 New fund structures, broader access: • Retail-focused (ELTIFS, LTAFs) and fully-funded solutions • Evergreen fund structures Market development: • Asset-backed finance market growing in private debt • Regional market growth, in places like India Structural forces: • New technologies require early-stage investment • Real estate is evolving to meet the needs of a changing world Private Markets.

The Fed has taken a significant step by officially initiating its cutting cycle, which holds profound implications for the financial world. ⚠️The #FOMC has cut the FFR by 50 Basis Points to a 4.75%-5% Range. ⚠️The latest projection of the Neutral Rate, R*, came in at 2.8% versus the previous estimation of 2.9% A cutting cycle might affect other central banks' stance on monetary policy because the US Dollar could devalue considerably going into 2025, making exports from other countries like Japan more expensive. For the past two weeks, business media has made a huge story out of a 25—or 50-basis point cut, but in my opinion, today's decision on the magnitude of the cut is meaningless. Financial conditions have eased considerably since July, so it should not be a surprise that the US economy might have already started to re-accelerate. The Atlanta Fed GDPNow is flashing a Real Growth Rate of 3% for the US Economy. If that materializes, it would mean that the US #Economy is already running 1% above its potential. Why financial conditions have already started to ease? Here are some examples: ✍️Mortgage Rates decreased from 7% in July to 6.15% today ✍️The 2-Year Yield decreased from 4.75% in July to 3.63% today ✍️The 5-Year Yield decreased from 4.06% in July to 3.47% today ✍️Housing Starts have picked up momentum What market participants have priced out is a resurgence of inflation during 2025. That scenario is entirely possible if the Dollar Index drops below 100. A cheaper dollar will make commodities and import prices more expensive for the US consumer, and a reduction in real income could squeeze even more of the low to middle class into the USA. Considering the decrease in US Treasuries for the past two months, I find US Government Bonds expensive across the yield curve at these levels. I think R* is well above what the Fed estimates because of factors like de-globalization, the reshoring of strategic industries, and increased protectionism. The terminal rate post-pandemic is between 3.5% and 4%, in my opinion, and that is where I think this cutting cycle will end. If I am proven right, bond investors must reprice government bond yields higher. How do we play a potential increase in inflation in a no-landing scenario? I tilted my portfolio as I outline here below: 👉Tilt the portfolio to over-weight energy and miners. 👉Have a marginal exposure to Gold and Silver. 👉Favor TIPs over US Treasuries 👉Increase allocation to US Value Stocks and International Stocks. 👉Lock-In US Investment Grade Credit at the belly of the yield curve where we can still get 4.8% to 5% yields, especially on issues at the Single-A Rating Enjoy the ride! #Finance #InterestRates #Economy #Investing

During the ascent of #fintech as a disruption driver in #finance, digital banks have been the first and most impactful use case. Let’s take a look at their playbook. The term itself – alternatives include challenger banks or neobanks – characterizes players (usually new entrants) challenging the traditional banking model with a #technology-first approach that involves flexible, branchless, digital-native (mobile) banking, often focusing on or starting from niche segments and customers. An increasingly digital arena, a shift in consumer behaviour and a gap in product and customer focus by incumbents have enabled these new players to challenge the status quo. Their success and proliferation around the globe is a clear sign of agile, digital-first, product-niche strategies prevailing over traditional, monolithic, vertical banking #business models. Whereas different patterns can be identified in their evolutionary path, the successful models can be aggregated to two broad categories: — Greenfield players starting completely from scratch by means of identifying a niche market or segment, often neglected by incumbents, and focusing on seamless customer experience, attractive design, competitive pricing and a digital or mobile only set-up. In terms of strategy two elements clearly stand-out: 1) hyper-growth and scale as the core - sometimes only - metrics (which explains why so many have been unprofitable) 2) an ecosystem play, driven by horizontal partnerships (vs the vertical traditional model). N26, Revolut and Nubank are typical examples of this model. — Large, closed-loop ecosystem players with a non-finance business geared on technology and an anchor in #ecommerce launching (digital) #banking spin-offs as a means of converting (and monetizing) their existing client-base. Most (or almost all) of the examples here come from Asia (i.e. Webank, Kakaobank), mainly due to the set-up of the #economy (lacking a robust, finance architecture and, in effect, benefiting private, BigTech players covering the gap). Webank, for example, is owned by Tencent, China’s largest social-media BigTech company (owner of WeChat, China’s equivalent of Facebook). It has managed to reach a value of $33 billion and a base of more than 320 million active users by focusing on building a modern IT stack (as a competitive edge to traditional banks) and leveraging on the data generated by the Tencent ecosystem (i.e. retail lending credit scoring built on Tencent data, resulted in a non-performing loan ratio of just 1.2%, about half (or less) of the industry average for such non-secured loans). Irrespective of their origins, both models have been (fast) converging to what has become the new holy grail of modern finance: platform #economics and ecosystem plays. These are the concepts that will be defining the boundaries in an increasingly network and technology driven field. Opinions: my own, Graphic source: Momentum Works, Decoding digital banks

Sustainability in Supply Chains A guide for private markets investors 🌍 Private markets investors face increasing pressure to integrate sustainability into supply chain management. This guide by PRI explains why supply chain due diligence is essential and how investors can embed it across the investment cycle to safeguard assets, reduce risks, and capture value. Supply chain risks, ranging from human rights abuses to environmental violations, have become financially material issues with direct implications for investor performance, regulatory compliance, and reputation. Human rights concerns are significant. Forced labour affects an estimated 28 million people worldwide, with rising risks in major sourcing countries such as India, Vietnam, China, Mexico and the United States. Migrant workers are particularly vulnerable, while child labour remains prevalent in high-risk industries and regions. Working conditions also present serious challenges. Excessive hours, unsafe workplaces and poor wages undermine the stability of global supply chains. These issues are concentrated in industries such as apparel, electronics, food and agriculture, construction materials and mining where oversight is often limited. Environmental risks add complexity. Nearly half of global sourcing markets face high or extreme risk of violations related to waste management, emissions and hazardous materials. Biodiversity loss and deforestation linked to commodities such as palm oil, soy and timber increase exposure to both regulatory and operational disruptions. Regulatory requirements are tightening worldwide. The EU Corporate Sustainability Due Diligence Directive, the US Uyghur Forced Labor Prevention Act and the EU Deforestation Regulation compel companies and investors to identify, mitigate and report risks throughout their supply chains. Failure to comply carries financial consequences. Volkswagen shipments were detained at US ports, Shein faced delays in listing plans due to sourcing concerns and companies in Germany were investigated and fined for breaches of the Supply Chain Act. These examples show how supply chain management is now a strategic necessity. Proactive due diligence creates opportunities. Companies with strong supply chain transparency and risk management can secure contracts, improve resilience, reduce costs and strengthen their brand. Investors can leverage these practices to enhance portfolio performance and protect value at exit. The guide explains that due diligence should be present at every stage of the investment cycle. This includes governance and policies, early screening, detailed risk assessments, legal agreements, active engagement, monitoring and exit planning. Clear roles, data systems and training are critical. Integrating sustainability into supply chain due diligence strengthens both risk management and value creation. #sustainability #business #sustainable #esg

Today marks a decisive turning point for India’s macro-economic direction! The RBI’s Monetary Policy Committee has cut the repo rate by 25 bps to 5.25%, upgraded FY26 growth to 7.3%, and brought inflation guidance down to 2%. What this means and why the shift matters: 1. Relief for borrowers & businesses A lower repo rate typically eases borrowing costs. Expect improved affordability for consumers and enterprises, which can lift consumption and support capex cycles. 2. A rare “Goldilocks moment” With inflation contained and growth estimates rising, we’re seeing a compelling intersection of price stability and demand-side stimulus — a combination that markets don’t get often. 3. Sectoral tailwinds Real estate, infrastructure and discretionary categories often feel the weight of high interest rates. With easier financing conditions, these sectors may see revived investments, improved hiring, and stronger demand. 4. A disciplined policy stance Despite the cut, RBI’s tone remains measured. The stance is neutral, inflation is modest, and the central bank retains room for future data-driven adjustments. From a macro lens, this isn’t merely a rate cut it’s a signal that India is entering a phase where stability and sustained growth can coexist without inflationary overshoot. What I’m tracking next: Transmission of rate cuts to retail lending, movement in fixed capital formation in Q3, consumption patterns in urban + semi-urban pockets, and MSME credit flow. Is this the start of a new growth cycle? I’m inclined to think yes but the next two quarters will tell us more.

The European Parliament has officially passed Extended Producer Responsibility (EPR) legislation that fundamentally shifts the responsibility for textile waste management to fashion brands and retailers – with far-reaching global implications. This new law requires all producers, including e-commerce platforms, to cover the full cost of collecting, sorting, and recycling textiles, regardless of whether they are based within or outside the EU. The financial burden of Europe's textile waste now falls squarely on the brands that create it. What are the critical business implications? UNIVERSAL SCOPE: The legislation applies to all producers selling in the EU market, including those of clothing, accessories, footwear, home textiles, and curtains. No company is exempt based on location. FAST FASHION PENALTY: Member states must specifically address ultra-fast and fast fashion practices when determining EPR financial contributions, creating cost penalties for unsustainable business models. GLOBAL SUPPLY CHAIN DISRUPTION: As the world's largest textile importer, the EU's new rules will ripple across global supply chains, particularly impacting exporters from Bangladesh, Vietnam, China, and India who supply much of Europe's fast fashion. TIMELINE PRESSURE: Officially adopted September 2025, this creates immediate operational and financial planning requirements. COMPETITIVE RESHAPING: Brands and retailers will inevitably pass increased costs down their supply chains, fundamentally altering supplier relationships and pricing structures globally. What are the implications for various stakeholders? For CEOs and board members: This represents more than regulatory compliance – it's a complete business model transformation. Companies must now integrate end-of-life costs into product pricing, rethink supplier partnerships, and accelerate circular design strategies. For sustainability and decarbonisation executives: This creates unprecedented opportunities for circular economy solutions, sustainable material innovation, and traceability system development across global supply chains. Link: https://lnkd.in/dTyHtHuD #sustainablefashion #circulareconomy #textilwaste #epr #fashionindustry #sustainability #supplychainmanagement #fastfashion #environmentalregulation #businessstrategy #decarbonisation #textilerecycling #fashionceos #boardgovernance #climateaction #wastemanagement #producerresponsibility #fashionsustainability #textileindustry #greenbusiness