Ian Monroe: Scaling Climate Solutions with Sustainable Investing

Ian Monroe, Etho Capital

Ian’s a bit of an all-star (although a humble one) to the point where I can’t possibly give all of his accomplishments the full recognition they deserve in such little space.

To give you a taste though, he:

  • has consulted on sustainable solutions in over 30 countries for nonprofits, the United Nations, the World Bank, and the US Department of State,
  • is currently a professor at Stanford in the Earth Systems Program (Tesla’s CTO, JB Straubel, was once his TA),
  • founded Oroeco which is an app that helps individuals reverse climate change by measuring and gamifying your carbon footprint,
  • and, most recently, he co-founded Etho Capital.

All of Ian’s work is tied together by his relentless drive to find and scale solutions to climate change.

Ian knew about climate change at a young age. He grew up noticing the effects of climate change on his family’s farm in Northern California. They had to deal with chaotic cycles of droughts and floods, forcing them to adapt and try different crops. Knowing climate change was real, Ian had a recurring nightmare as a kid of his house burning down…and eventually, it came true. In October of 2017, the Redwood Complex Fire raged through his community with 100 foot high walls of fire moving at hurricane speeds – fast enough to cover a football field every three seconds.

Ian’s family was lucky. Their dog, Chewy, woke them up just in time for them to get away safely and alert their neighbors.

However, when it was all said and done, the community was destroyed. Over 500 homes had burned down and 9 of their neighbors had lost their lives.

Ian, his Mom, and twenty other relatives lost their homes. Many are still living with friends, family, or in rentals as a result.

Ian has taken all of this and used it as motivation for his work. He wakes up every day thinking of ways to scale climate solutions as quickly as possible because he knows firsthand what the worst of climate change can do and, more importantly, what it feels like. He works to protect the homes of his family and friends from climate change.

After creating Oroeco to help empower the masses, Ian is now focusing on investors with Etho Capital and showing them that their money is better off in the most sustainable companies.

Etho Capital is an investment management firm and the endeavor I’m most excited about. They use their own, comprehensive research methods to evaluate over 6,000 companies (and their supply chains) to find the climate leaders in each industry. They believe companies with less climate pollution have more efficient operations, smarter management, and are better prepared for future climate risks. On top of this, they layer in traditional ESG (environmental, social, and governance) and SRI (sustainable, responsible, and impact investing) sustainability evaluations because they believe these companies will be more competitive and produce better returns over time. Etho Capital has been recognized by Fast Company as one of the “Most Innovative Companies” and their flagship product is a diversified, sustainability ETF, called “ETHO” which is on the New York Stock Exchange. (I actually bought ETHO early on before I knew Ian because it aligns with my values)

Ian’s previous work in sustainability gives Etho Capital a leg up on competitors when it comes to analyzing and selecting the most sustainable companies. Their in-depth, research-based, analysis goes far beyond what companies self-report. By taking the supply chain into account, which often makes up 80% of a company’s GHG emissions, they get the full picture of a company’s carbon footprint.

As you can see, the ETHO ETF has 85% fewer GHG emissions than the S&P 500

Although conventional wisdom would tell you that accounting for ESG and sustainability factors means sacrificing financial returns, Etho Capital’s performance in the market speaks for itself, outperforming the S&P 500 over the past three years by about 12%. If you ask me (a non-professional, not giving you financial advice), failing to account for these ESG and sustainability factors is what will lead to lower financial returns, not the other way around.

Knowing how bad climate change is and how bad it will get, Ian is still hopeful when it comes to solving climate change.

“On one hand it’s a massive collective action issue that we’re all contributing to, but the flip side is we all can and must be a part of a massive collective solution. We’re at a tipping point, similar to cell phones taking over landlines and other exponential technologies – the point where most clean technologies are just better and cheaper so people will buy them even if they don’t care about climate solutions. The economics and overall value of climate solutions are making them more of a no-brainer every day – and that’s true for smart companies, investors, and all of us as citizens.”

More info:

  • Short video of Ian speaking about Etho Capital.
  • Ian’s recent interview on climate science, sustainability investing, and wildfires.
  • Video of escaping the fire.
  • Go Fund Me for Ian’s family members to rebuild their home.
  • Ian’s Ted Talk on Oroeco.
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