Strategic Asset Management

Sustainability Maturity Self-Assessment 🌎 Understanding the level of sustainability integration within an organization requires structured analysis across multiple operational dimensions. Moving beyond isolated initiatives, this approach provides a clearer view of internal alignment and areas requiring systemic improvement. Disclosure practices are a key area of focus. Integrated reporting that connects sustainability and financial data, alignment with frameworks such as TCFD, and preparation for new regulatory requirements indicate a higher level of maturity. Effective organizations establish clear sustainability targets. These targets are measurable, time bound, and supported by transition plans and internal accountability. They serve as reference points for strategic planning and operational execution. Governance is another critical pillar. The presence of formal structures, leadership ownership, and cross departmental coordination reflects whether sustainability is embedded into core decision making processes. Board oversight acts as a signal of institutional prioritization. Regular engagement, monitoring through defined indicators, and integration into enterprise risk management processes are all essential components. Data quality underpins all sustainability decisions. Organizations are evaluated based on their ability to collect, estimate, and validate key metrics, particularly emissions data aligned with recognized methodologies. Value chain visibility expands the lens beyond internal operations. The ability to monitor sustainability performance upstream and downstream indicates a broader understanding of impact and risk exposure. Procurement strategies also reflect the depth of integration. When sustainability criteria shape supplier selection and guide collaborative initiatives, procurement becomes a tool for driving environmental and social outcomes. This type of evaluation does not produce a static score. Instead, it highlights capability gaps, supports internal benchmarking, and informs priorities for systems level improvements aligned with strategic sustainability objectives. #sustainability #sustainable #esg #business

For too long, we’ve built our economies as if nature were free. We draw down forests, deplete soil and pollute water without accounting for the costs. Yet more than half of global GDP depends on natural capital. What would it look like if we accounted for our natural assets? If our financial system properly valued forests, soils, biodiversity, clean water and air, and pollinators? I want to share three examples from our portfolio showing how this shift works in practice: Amazonía Emprende (Colombia) In the Colombian Amazon, Amazonía Emprende is restoring degraded lands and building a native seed center to supply high-quality seedlings and support ecosystem restoration. Their target: restore more than 150,000 hectares by 2031. They’re also exploring biodiversity credits — developing baselines to monetize regenerated habitat so preserving and restoring the forest becomes a revenue-generating asset. This creates income opportunities for local and Indigenous communities, replacing activities that drive deforestation with ones that deepen the value of nature. SiembraViva (Colombia) SiembraViva works with smallholder farmers to shift from low-yield commodities to organic, value-added crops. By migrating to regenerative practices, farmers improve water retention, reduce erosion and build soil organic carbon. They see the soil itself as a natural asset — a reservoir of resilience and value. When we treat soil as a balance-sheet item, we see how degraded land is a liability and healthy soil an asset to businesses and local economies. BURN (Kenya) BURN’s efficient cookstoves replace charcoal and firewood use, cutting household fuel costs and reducing pressure on forests. Their technology enables roughly 60 percent less charcoal use compared to standard stoves, averting deforestation and saving millions of tons of wood. By reducing tree-cutting for fuel, BURN helps shift forests from a hidden cost line to a natural asset line, sustaining clean air and preserving biodiversity and climate resilience. When companies and investors ignore natural assets, they’re betting on an unsustainable future. When we account for them properly, we open the door to regenerative models that treat nature not as a free input but as a core asset. The Belem Declaration on Hunger, Poverty and Human-Centered Climate Action at #COP30 reinforces how interconnected our systems are. If we don’t measure nature and build it into our balance sheets, we risk losing it. If we value it properly, we can build economies that regenerate, not extract — and that speak to the truth that our dignity is intertwined with how we treat all living things.

Volatility doesn’t destroy value. Delayed decisions do. Over the last three years, #renewableenergy projects globally have absorbed 400–500 bps increases in financing costs, sharp supply-chain disruptions, and regulatory resets that changed returns mid-execution. Data shows that project costs for solar rose materially between 2021 and 2023, the first sustained reversal in a decade. In this environment, leadership based on spreadsheets alone fails. What arrives before the numbers are signals from people - engineers flagging execution risk, local teams sensing permitting friction, and communities questioning long-term impact. Studies on large infrastructure delivery consistently show that projects with weak stakeholder alignment face significantly higher schedule overruns and cost escalation. Emotional intelligence, in this context, is not empathy; it is early risk detection. But listening without decisiveness is equally costly. Every month of delay in a capital-intensive renewable project compounds financing costs and slows grid #decarbonization. Once direction is clear, leaders must act with conviction. Waiting for perfect certainty is not prudence; it is value erosion. These lessons shape how I think about leadership and renewable energy at Inox Solar. India’s ambition of 500 GW of non-fossil capacity by 2030 demands sustained annual additions at a scale never executed before, alongside transmission build-out and land coordination across states. Technology and capital are necessary, but leadership discipline will determine outcomes. Renewable energy assets operate for 25+ years. Leadership decisions made today affect communities, land use, and regional economies long after commissioning. Integrating social impact into core strategy is not idealism; it is risk management. In volatile markets, the strongest leaders do two things well: They listen early, and they decide on time. That is how transitions are led. Kailash Tarachandani, Devansh Jain, Inox Clean Energy, INOXGFL Group

In almost every utility-scale #BESS discussion today, one question inevitably comes up: “Should this project rely on contracted revenues or go merchant?” From my experience working closely with #batterymanufacturers, IPPs, utilities, and financiers, I can say this clearly: there is no universally ‘right’ answer—only a right answer for the project’s risk appetite, market maturity, and long-term vision. ➤ Contracted revenue models bring comfort. They offer predictability, stability, and bankability. Long-term capacity contracts, tolling agreements, PPAs, or ancillary service contracts make lenders comfortable and allow projects to move forward with lower financing friction. For markets still developing storage regulations—or for investors prioritizing capital preservation—this structure is often the natural starting point. But there is a trade-off. Predictability often comes with limited upside. Once the contract terms are locked, flexibility reduces. The asset becomes stable—but less agile. ➤ Merchant revenue models, on the other hand, represent the true power of BESS. Here, storage behaves as a dynamic grid asset—participating in energy arbitrage, frequency regulation, congestion management, and multiple ancillary services. The upside can be significantly higher, especially during peak pricing events. But so is the exposure. Market volatility, price uncertainty, and operational complexity demand stronger forecasting, robust EMS, and disciplined risk management. In simpler terms: Merchant BESS doesn’t forgive design, testing, or operational mistakes. And this is where I believe many conversations miss a critical point. ➤ Your revenue model should influence how you design, test, and operate your BESS—not just how you finance it. A merchant-heavy asset demands: • Higher confidence in cell consistency • Stronger thermal and safety margins • Accurate performance testing and degradation modeling • Faster response times and tighter control logic Whereas a contracted asset may prioritize: • Long-term reliability • Predictable degradation curves • Contractual performance guarantees Increasingly, what we are seeing globally—and now in India as well—is a hybrid approach. A base layer of contracted revenues to ensure downside protection, combined with merchant participation to unlock upside during favorable market conditions. This hybrid strategy is not just financially smart—it reflects how modern grids actually behave. As storage evolves from a “supporting asset” to core infrastructure, these decisions will define project success over the next 15–20 years. At Semco, our constant focus is ensuring that technology, testing, and system design are aligned with the business model, because in BESS, revenue certainty is built long before the first unit of energy is dispatched. Would love to hear perspectives from developers, investors, and grid operators— How are you balancing stability and flexibility in your storage projects?

Gold above $2,400 isn’t the only thing reshaping the mining landscape the U.S. government just signalled it’s ready to step into the sector as more than a regulator. Washington has launched “Immediate Measures to Increase American Mineral Production,” which reframes mining as a national security imperative. That subtle shift is anything but symbolic it gives the green light to fast-tracked permitting, Defence Production Act financing, and remarkably the government itself taking equity stakes in mining companies. The headline example is MP Materials. The Department of Defence dropped $400 million to take a 15% stake in the company, making it the largest shareholder. That’s not a token gesture, it’s the state directly bankrolling a rare earths supply chain from mine to magnet. If you’re MP, that’s a dream partner. If you’re an investor or explorer, it’s confirmation that mining has officially moved from the policy sidelines into the centre of industrial strategy. This is the first time in decades that U.S. policy has been this aligned across the executive, legislative, and defence arms. Gold, copper, uranium, and even potash are now on the expanded “critical” list. The language has shifted from “permit and regulate” to “prioritise and fund.” That’s powerful. It tells the market that mining isn’t just tolerated and the government is prepared to shoulder risk alongside the private sector. Of course, Otavio (Tavi) Costa point is right, there’s a long way to go. Building genuine mineral independence takes more than a few executive orders and a splash of capital. But the tailwind is real. For years, miners were left to struggle for capital while tech and energy hogged the spotlight. Now, the U.S. is saying out loud what the industry has always known, no minerals, no transition. And if this momentum holds, we could be looking back at 2025 as the year the mining cycle truly turned. #Mining #CriticalMinerals #Gold #Copper #RareEarths #Exploration #Commodities #Investing Sources: Kitco News (Aug 14, 2025), Crescat Capital – Tavi Costa

Silver is no longer just a precious metal. but has quietly become an important industrial and geopolitical asset. 🥈 DEMAND DRIVERS 🌏Recent strength in silver isn't just driven by speculation. More than half of the global demand now comes from industry. 🔌🔋Solar panels, electric vehicles, semiconductors, data centers, and advanced electronics all depend on silver’s unmatched conductivity. At the same time, the supply is tight. Most silver is MINED AS A BY-PRODUCT, which limits how quickly production can increase in response to higher prices.⛏️ COUNTRY WISE DEMAND Let's look at the situation in different countries: 🇨🇳CHINA leads in silver consumption due to its solar manufacturing, electric vehicles, and electronics. Export controls and strategic stockpiling mean that China doesn't just consume silver; it also influences global supply.🚎🔌💡 🇮🇳INDIA maintains strong physical demand through jewellery, coins, and bars. Rapidly expanding solar capacity adds a significant industrial layer.☀️ 🇺🇲In the UNITED STATES, demand is from technology, artificial intelligence, data infrastructure, renewables, and investment flows through ETFs. This makes silver sensitive to interest rates, the dollar, and overall market sentiment. 🇩🇪EUROPE, especially GERMANY, relies on silver for automotive parts, electric vehicle components, and clean energy goals. However, growth closely follows economic conditions.🏎️🚘 🇯🇵JAPAN and SOUTH KOREA may have smaller volumes, but they are crucial for high-precision electronics and semiconductors, where alternatives are limited.🇰🇷🔌🚎 THERE ARE RISKS TO CONSIDER. 🥈 Industrial demand tends to be cyclical, silver is more volatile than gold, and improvements in efficiency could reduce usage per unit over time 🥈Presently there is high volatility due to geopolitical tensions. BOTTOM LINE: Silver is being pulled by real industrial necessity, not just investor interest. As electrification, energy transition, and digital infrastructure expand, silver stays strategically important — but volatility comes with it's rise and investors need to tread cautiously. 🥈🔌💡 What do you think? Image Credit. Respective Owner LinkedIn LinkedIn News India LinkedIn Guide to Creating

VPPs Are All the Rage – But They’re Not Just for Households! ⚡ Virtual Power Plants (#VPP) are once again a hot topic—and for good reason! The focus often falls on aggregating smaller players, like households or small producers, into a unified power source. However, the VPP model is just as relevant for large-scale producers managing a portfolio of Power Purchase Agreements (#PPA) from renewable assets like wind, solar, and storage. By treating renewable assets as an integrated portfolio, substantial value can be unlocked. Additionally, centralized portfolio management helps protect revenue against the volatile effects of renewable-dominated markets Turning Your PPA Bundle into a VPP  Managing a portfolio of PPAs from wind, solar, and storage assets mirrors the process of a “small” VPP. Through technology, these assets can be interconnected which then allows for the optimization across various energy markets, from ancillary services to bilateral PPAs. This portfolio approach maximizes the efficiency of diverse assets through centralized control, just like a VPP. How to Transform Your PPA Portfolio into a VPP 1. Digitally Connect Your Assets Gain the ability to operate your units as a single entity by connecting them through infrastructure and software, which are readily available and proven effective. 2. Build a Dedicated Commercial Team Start with a revenue management strategy that covers the full spectrum of PPA durations—from long-term contracts to day-ahead markets and ancillary services. This specialized team should structure, price, and execute PPA, hedging, and trading strategies. Most of the execution work can be outsourced as well, but oversight and control over partners remain essential 3. Enhance Data and Analytics Implement systems that offer deep insights into revenue streams, risk profiles, and market changes' impacts. Robust data and analytics are essential to managing a dynamic portfolio. The Benefits of Operating a Large-Scale VPP  A large-scale renewable portfolio managed as a VPP—even one based on long-term PPAs—can drive meaningful savings through reduced Route-to-Market and balancing costs while generating additional revenues. These gains arise from the flexibility to optimize production across all available energy markets. Most importantly, this approach allows producers to participate in future markets and innovative business models, such as offering fixed green shapes (see my recent post on 7/11 PPAs), selling power to smaller but higher-yielding industrial off-takers, and mitigating the impact of negative prices. Transforming a PPA portfolio into a VPP will require a dedicated effort, a clear commitment from top management, and an understanding that the journey will be a longer-term one. Embracing this approach positions renewable portfolios to thrive in the evolving energy landscape while unlocking new potential for sustained growth.

Big validation this week for anyone who's argued that sustainability, systems thinking, and systemic risk management belong at the center of portfolio construction, not bolted on as an ESG overlay. CFA Institute just published a major practical guide on the Total Portfolio Approach (TPA) — the framework reshaping how the world's largest asset owners (Future Fund, NZ Super, CalPERS, and others) build portfolios. One of its core arguments: under TPA, sustainability and systems thinking are design features, not constraints, because financial markets are embedded within the environmental, social, and economic systems they depend on. Climate change, biodiversity loss, and social instability aren't risks you can diversify away — they're systemic, and they demand system-level thinking. The report cites my work with Jon Lukomnik, and our book "The Handbook of System-level Investing," on exactly this point: asset owners need to move beyond optimizing a single portfolio and start managing the health of the systems that portfolio depends on. Worth a read for anyone rethinking asset allocation for a more interconnected, less diversifiable world. Congrats Roger Urwin of Thinking Ahead Institute and Genevieve Hayman, PhD of CFA Institute Research & Policy Center for another great contribution to the field. #investing #systemsthinking https://lnkd.in/d_-m7yAE

Renewable energy is transforming the U.S. power market, which is set to grow from 25% to 45% of total generation by 2030. This rapid expansion, while crucial for a low-carbon future, brings new dynamics for investors to navigate — particularly around price volatility. To counteract renewable energy source-driven volatility, flexible assets have become a remedy in managing supply-demand imbalances and stabilizing returns. Battery storage, gas generation and demand response are leading solutions, helping portfolios remain resilient in increasingly volatile markets. Taking one example: battery storage capacity in the U.S. is expected to increase from 13 GW today to 110 GW by 2030, marking an eightfold growth as investors respond to stronger demand for higher storage capabilities. Batteries allow excess energy to be stored when prices are low and released during peak demand — creating new revenue opportunities and reducing exposure in lower-price periods. With their ability to quickly respond to price fluctuations, batteries are becoming an essential asset for stabilizing returns. In addition to integrating flexible assets, a multi-pronged strategy is essential for long-term stability in renewable-heavy portfolios. Acquiring flexible capacity through M&A can add resilience to existing investments. Integrated financial modeling allows investors to take a portfolio-wide view of potential risks and returns. By simulating how flexible assets and financial hedges perform under different market conditions, investors can optimize for risk-adjusted returns, structuring portfolios that strike a balance between risk appetite and stability. For a perspective on battery revenue optimization, see an article in the comments below. https://lnkd.in/eBxvTizY

🟡 Which Countries Hold the Most Gold? Gold remains a cornerstone of monetary credibility, financial resilience, and geopolitical insurance for central banks. Official gold reserves are highly concentrated among a small group of nations. As of 2024, the United States leads with 8,100+ tonnes, followed by Germany, Italy, France, Russia, and China. These holdings reflect decades of accumulation and continue to anchor monetary systems — particularly during periods of currency stress or geopolitical uncertainty. Between 2019 and 2024, China added more than 330 tonnes, outpacing every other central bank. India, Poland, and Türkiye also recorded substantial increases, signaling a broad shift toward gold as a strategic reserve asset rather than a passive legacy holding. 📊 Why Central Banks Are Buying Gold The motivations are strategic. Gold offers diversification away from dollar-denominated assets, protection against sanctions and asset-freeze risk, and resilience during periods of financial and geopolitical stress. For countries with elevated geopolitical exposure, gold provides something no financial asset can: neutrality with no counterparty risk. 📈 What This Means for Markets Sustained central bank demand has become a structural driver of gold prices. While short-term performance remains sensitive to real interest rates and U.S. dollar strength, long-term accumulation trends suggest gold’s role is expanding — from a passive reserve to an active strategic asset on sovereign balance sheets. Central banks are sending a clear signal: trust, permanence, and neutrality matter more than yield — and gold uniquely satisfies all three. ✅ Key Insights 1) The U.S. still dominates, but isn’t expanding. America’s gold stockpile remains unmatched, yet it has barely changed in decades while others aggressively add. 2) Europe’s gold is about stability, not strategy shifts. Germany, France, and Italy hold massive reserves, but accumulation has been modest compared to emerging markets. 3) China and Russia are closing the gap. With 2,300+ tonnes each, both have elevated gold into a core pillar of monetary sovereignty. 4) Gold accumulation is accelerating outside the West. From 2019–2024, China, India, Poland, and Türkiye led global purchases. 5) De-dollarization is the new reserve strategy. Rising gold allocations reflect long-term planning to reduce exposure to Treasuries, sanctions, and currency risk.