“The land use transition that needs to happen…is a couple of things: One is stopping tropical deforestation, which is roughly 10 percent of total global emissions. And the other big thing we need is something like six hundred million hectares of reforestation, most of that in emerging markets, over the next 10 to 15 years. It’s just a matter of getting the capital flowing there”
— Radha Kuppalli
Radha Kuppalli is Managing Director of Impact and Advocacy at New Forests, a leading asset manager in institutional funds management business, providing forestry and land-based investment solutions through sustainable forestry investments. Her 20-year career has been focused on driving capital markets toward investing in climate change solutions and sustainable development.
Radha is a director of the Board of New Forests Pty Ltd, member of the company’s Executive Committee, and a member of all Investment Committees. She is also a Non-Executive Director for Timberlink Australia and Greening Australia and chairs Greening Australia’s investment committee. She earned an MBA and a Masters in Environmental Management from Yale, serves on the university’s Advisory Board at the Center for Business and Environment, and is an associate of the Yale World Fellows Program.
In this episode, we discuss Radha’s studies, her early career, the ‘sliding doors’ moments that led to her working at Natsource and joining New Forests back in 2006, and how Radha’s care for the environment has shaped her career. We learn how New Forests select their investments, who their typical investors are and the attractions of investing in forestry as an asset class. We discuss New Forests’ three main regions and the different approaches used in each. And we talk about the California Cap and Trade Scheme emissions trading system, conservation easements, repatriating land back to the Yurok tribe and much more.
I really enjoyed this far reaching discussion with Radha and I hope you do too.
Listen to the episode on Apple Podcasts, Spotify, Overcast, Podcast Addict, Pocket Casts, Castbox, Google Podcasts, Amazon Music, or on your favorite podcast platform. You can watch the interview on YouTube here.
What was your favorite quote or lesson from this episode? Please let me know in the comments.
SCROLL BELOW FOR LINKS AND SHOW NOTES…
SELECTED LINKS FROM THIS EPISODE:
- Connect with Radha Kuppalli: LinkedIn
- AXA Investment Managers
- Carnegie Endowment
- Forest Carbon Protocol
- Forest Stewardship Council (FSC)
- Greening Australia
- Kyoto Protocol
- Managing Global Issues (Book)
- Natsource
- NCREIF Index
- New Forests
- Task Force on Climate-related Financial Disclosures (TCFD)
- Timberlink Australia
- Trust for Public Land (TPL)
- UN-REDD programme
- Yale Center for Business and the Environment
- Yurok Tribe
SHOW NOTES:
[00:00] Episode introduction
[04:52] Radha describes her education and how she came to earn two degrees in just four years
[07:51] Radha shares how she became involved in the carbon markets back in 2001 and how there has been a common thread of climate and carbon throughout her career
[08:55] Radha tells us how her care and passion for the environment has been the driving force in her career
[09:58] Radha describes a ‘sliding doors’ moment, when a chance conversation with Carlos Lozata led to her working for Natsource
[11:04] Why Radha chose to return to studying, taking a Masters in Environmental Management at Yale
[12:35] We hear how another ‘sliding doors’ moment led to Radha joining New Forests in 2006
[14:33] How Radha came to set up New Forests in the US in 2007
[17:41] We discuss Radha’s various professional association roles
[21:49] An overview of New Forests, their typical investors and what makes them unique
[27:36] We hear about New Forests’ various Funds
[29:05] How New Forests use third party certifications to ensure Responsible Investment
[29:45] Radha outlines the traditional attractions of forestry as an asset class
[37:16] We hear how New Forests select their investments and the type of screens used
[41:47] The US ‘Carbon Forestry Strategy’ and how it is used
[42:17] We discuss New Forests three main regions and how the approach is slightly different in each
[43:56] We hear about California’s ‘Forest Carbon Protocol’ and how it creates an incentive to maintain carbon stocks
[47:00] We discuss Conservation Easements and a New Forests transaction that helped repatriate land back to the Yurok tribe
[50:09] We hear Radha’s views on major climate change risks in forestry
[01:01:39] The single most important challenge in the sustainable real asset space at this time
[01:01:51] What Radha knows now about sustainable investment and impact investing that she wishes she had known when she started at New Forests
[01:02:24] Lessons learned from an investment that didn’t go to plan
[01:04:18] An example of an investment that worked out better than expected
MORE RADHA KUPPALLI QUOTES FROM THE INTERVIEW:
“It just really occurred to me that it’s always been about the environment for me…that’s what I care about.”
— Radha Kuppalli
“The underlying fundamentals of timber and the underlying fundamentals of the forestry asset class are very sound, so a lot of this comes down to ‘did you buy it at the right price and at the right time’, and there have been some – particularly US institutional investors – who got turned off the asset class because of some of the poor returns, but I think for those investors who like forestry, those market fundamentals are always there.”
— Radha Kuppalli
“We know what needs to happen in the energy transition. It’s just a matter of getting the capital flowing there. The transition that’s required in land use is much more complex. I think, increasingly the investment appetite is there, but now we need investable solutions, and that’s really the problem that we need to solve.”
— Radha Kuppalli
“There’s a really important role to be played by Government. Ultimately we’re talking about public goods. We need robust climate policies, strong carbon pricing mechanisms and price signals. Because, a lot of the carbon markets right now are just tinkering on the margins, but if you get to a world with a $50 per ton carbon price, timber becomes the by-catch, and the underlying economics is actually the climate mitigation.”
— Radha Kuppalli
PEOPLE MENTIONED:
