A group of venture capital firms have formed a global alliance designed to help firms and their portfolio companies fight climate change and identify ways to reach net-zero emissions by 2050 or sooner.
San Francisco-based Venture Climate Alliance comprises 23 venture capital firms from across the U.S. and Europe, said an April 25 news release. Among other things, VCA member firms will pledge to inventory their direct Scope 1, 2 and 3 carbon footprints and to achieve net zero or negative emissions for their own firm's operations by 2030 or sooner. Members will also encourage and help their portfolio companies set their own targets to achieve net-zero alignment by 2050 or sooner.
Scope 1 and 2 are emissions that come from entities that are owned or controlled by a company or are produced indirectly by the energy it purchases for use. Scope 3 emissions are also indirect, for example, emissions from a company in a firm's supply chain, according to energy firm the National Grid, an energy firm operating in the U.K. and U.S.
Matt Ocko and Zachary Bogue, Palo Alto, Calif.-based co-founders and co-managing partners at DCVC Management Co. LLC., a VCA member, said by email that the "really important work comes next: VCA must develop robust methodologies and frameworks for measuring and reporting emissions data and impact, together with accountability mechanisms that build on current best practices."
Dan Firger, New York-based co-founder and lead adviser for VCA and managing director of consultancy Great Circle Capital Advisors, said by email that as more limited partners in venture funds set and implement their own net-zero targets, "it is becoming more pressing for VCs to have answers to questions they may ask about alignment."
Amy Duffuor, Cambridge, Mass.-based general partner and co-founder at alliance member Azolla Ventures, said by email that VCA represents the first time that "venture capital firms, regardless of sector focus, are coming together to say we collectively need to achieve our net-zero goals." She added: "Collaboration is key here because we will go farther together than we can in silos, and the VCA understands that."
