The BwB Talk Series is where we bring innovative leaders in impact, finance, and the environment to speak with our network around the world. The BwB Talk Series helps generate new ideas for our network by bringing experts to share their deep knowledge of sustainability topics.
For the first BwB Talk Series for 2023, we had the pleasure of welcoming Madhuban Kumar, Founder and CEO of CarbonLaces - an award-winning data service platform which builds financial tools for energy decarbonisation with real-time data.
The concept for creating CarbonLaces was born way before in the summer of 2009 with the business's launch, following a personal life-changing experience of Madhuban in the Arctic. Back then, she started asking herself, after seeing the impact of previous global warming first-hand, what she could do to reduce this. Since then, her career has been in finance, from retail to capital markets, data and more recently in energy
Later in her career, Madhuban joined the advisory board of Centrica, where she led the restructuring of one of their portfolio companies while also working on her trading start-up. This exposed her to understanding the scope and challenges of utilities in the UK and the centrality of data to all the processes and monitoring activities. This is when Madhuban decided to bring CarbonLaces to life, aiming to bring the missing piece of the data and tools with the financing needed to speed up decarbonisation.
Some of the major issues the company identified in the first years of operations were that measures are very time-consuming require up-front costs and complex workflows. “There is also a consistent lack of monitoring tools, clarifications, and as a result, the profitability out of that has been skimmed.”, commented Madhuban. “CarbonLaces aims to monetise energy finance. We do that through standardised metrics, automation of incentives.”, she added.
One of the most interesting segments of our Talk Series is the Q&A session between our speaker and BwB. This talk’s Q&A segment was filled with insightful moments, a few of which we have captured below.
The first question was raised by Stephen Smith (BwB Managing Director, Global Head Carbon & Forestry), who inquired on the compliance issues the company has been able to resolve.
Madhuban explained that compliance is a multi-level field of which data takes one layer. “It took us a year and a half to work with various partners across the energy value chains, and we have gone through our own regulations to make sure we can source and work with the anonymised data.”, commented Madhuban. Additionally, she added that the uncertainty in compliance is significant. “We can see if savings happen from our platform, and it's transparent. We work with various parties, including government, so get insights into new regulations, changes coming and how they impact”.
The BwB team took the opportunity to find out more how Madhuban and her team have been able to address some other key challenges as a small business, such as quality of data, competitors and simplification of complex concepts like EPCs.
Rufus Grantham (BwB Managing Director, Global Head Urban Transition Finance) then commented that BwB’s work has been principally focused on selecting models for taking scaled retrofit and given the complexity, haven’t been directly exposed to MRVs just yet. “Hopefully we are now moving towards that particularly in Europe with our work with Net Zero Cities when more funding will be coming through for cities”, added Rufus.
Christine Zhou (BwB Vice President) further commented: “Part of the funding model we’d like to unlock is less traditional focused on outcomes which are not necessarily financial. For this, we definitely need the data and its verification if we are to be able to unlock all the monetisation opportunities.”
“Measuring Carbon is relatively easy. But MRVs processes are a huge component part of supporting performance-linked loans. It is a big part of it how you go beyond that to measuring other factors which drive change in principle related to biodiversity or nature. This is related to our other work we do to nature-related disclosure with TNFT and UNIP FI so it is interesting to see if there is a Natural extension of all this beyond the carbon aspect to other measures which are increasingly being integrated into performance-related instruments of all kinds.”, added Chris Smith (BwB Managing Director, Global Head Debt Finance).
Madhuban was also joined by Ely Macphail Business Development Consultant, introducing CarbonLaces, who intervened on Harry Wain’s inquiry on CarbonLaces’ client base. After Madhuban’s answer of how Carbon Laces was naturally brought into the banking industry first, their products can serve many other client types. Ely added that data verification was key both for the company’s investors and customers since it opens a plethora of opportunities. CarbonLaces also regards the fall-forward system of collaborating on financial products to open up to new customers and unify the financial world as a significant path to success.
Ely also added that such approach favours the multinational trade of carbon credits and potentially can enable access to foreign Green Bonds. CarbonLaces’ product development schedule, also allows the company to verify things such as foreign carbon credit criteria and plastic credits, which are becoming increasingly more popular and more regulated.
At the end of the conversation, Madhuban extended her gratitude to the BwB team for the fruitful and insightful session and proposed to share with the BwB Team the CarbonLaces White Paper, published by the WEF.
Find the WEF paper at the following link.
Keep up to date with our BwB Talk Series on our LinkedIn and Twitter. The BwB Talk Series is done periodically through the BwB network and brings together innovative thought leaders to speak with stakeholders around climate and finance issues. The BwB Talk Series supports collaborative and iterative conversations with people worldwide. Please direct any questions or requests for additional information to email@example.com or your usual BwB contact.
Bankers Without Boundaries, an innovator in finance, is a not for profit powered by former investment bankers to assist high impact projects that benefit the environment and social good. BwB works with local and sub- and national governments, cities, institutions, and foundations to mobilise capital advisory and research services. BwB applies financial concepts and structuring to public projects to align them with the investment needs of capital markets, thinking about risk reduction, scaling and generation of financial returns alongside broader positive co-benefits and impacts.