Our commitment to sustainability
We see sustainability as an opportunity, and a crucial responsibility
Luminar's ESG and sustainability thesis
At Luminar Ventures, we strongly believe that digitization will not only improve how business is done, but it will also improve society and our planet. It’s now 27 years ago that John Elkington coined the “Triple Bottom Line” of People (ESG), Planet (Sustainability) and Profit (also known as the 3Ps), and this is becoming more relevant than ever as we see a strong acceleration from investors towards improving the balance between these areas. These 3Ps have been cornerstones of the creation of our fund, were we believe every company need to make sure they accel on all 3 to attract talents, customers, investors to give us, and the planet, great returns, and long-term sustainable companies
We are therefore looking for founders that have that same view and passion for sustainability. This does not mean that we only looking for impact companies, as we believe this mindset should reflect all type of companies. As it is an important part of our work with portfolio companies, we actively support our founding teams in setting up their own ESG and SDG strategies and objectives throughout their growth plan. These sustainability focused strategies and its results should be fully integrated into the core of the company culture and be an important part of how they present themselves for investors when raising capital to fulfil their vision. The effort is done in partnership with our portfolio company, Normative, which allows companies to automatically measure and report their global footprint across multiple KPIs is one important part of this work. As field experts, Normative is leading sustainability workshops with our portfolio companies, in which they are also reviewing and updating their SDG goals. These KPIs are then measured and reported to us through the Normative platform on an annual basis or even more frequently.
Some of our portfolio companies, on our first fund, are offering services that are more directly targeting climate change such as Greenely, Normative, Omocom, HackYourCloset and Hemma. Out of these five companies, two are circular — companies that are aiming at eliminating waste and the continual use of unsustainable resources. Already, Normative have, through companies in their platform, helped to mitigate 0.5 MTon of CO2. This is equivalent to the entire country of Gambia. Simultaneously, Greenely, during 2020 helped their 100,000 users to mitigate 0.1 MTon of CO2 in 2020 alone.
Many of the companies are also having a great social impact, including Mindler, Insurello, Vården.se, Health Integrator, Heja and more. In support of our thesis, Mindler and Insurello have been the first to raise their Series A rounds. The social impact from these companies is already impressive — Mindler enabled over 100,000 consultation sessions in 2020, improving mental health in difficult times for many, and Insurello helped process just nearly 100,000 insurance claims, helping customers to obtain their legal right to compensation after accidents.
Luminar is now four years into its fund life cycle, and it’s very encouraging for us to see that some companies already make a significant impact. We have great hopes for this development to continue in our portfolio during the years to come and in our second fund.
Identification of sustainability risks (ESG & SDG)
Luminar is assessing every company from a ESG and SDG perspective, in particular the sustainability opportunities, for every potential investment. If sustainability risks are discovered during the investment decision process, they will be discussed by the investment committee and an overall assessment will be made of whether the risk can be managed. Otherwise we will not invest.
Adverse sustainability impact
We consider the adverse impacts on sustainability factors that our investments may have. This is done during the evaluation but also regular for portfolio companies. The companies in the Seed stage will go through sustainability workshops and we will on-board the companies into our analytics provider Normative. The following sustainability and factors are currently measured:
Greenhouse Gas emissions, Water use, Ecosystem quality, share of female employees, number of jobs created.
Portfolio companies should be committed to be compliant with relevant anti-corruption laws and regulations in all jurisdictions, have high standards of business ethics and be compliant with anti-trust and competition laws.
We are monitoring that employees are treated fairly including respect for international labour and human rights standards, safe and healthy working conditions, avoidance of discrimination or harassment and responsible labour management.
The above statement of adverse impacts on investment decisions on sustainability factors is describing the major parts of Luminar ongoing work and efforts.
EU SFDR Regulations
On 10th of March 2021 The “Level 1” of the EU Sustainable Finance Disclosure Regulations (SFDR) started to apply. As of now Luminar does not consider adverse sustainability impact according to these draft standards. Final technical standards (”RTS”) for reporting is expected to arrive on January 1, 2022. Luminar will take the decision if to follow these specific standards after they are made available.