Karsten Wenzlaff, Advisor
August 26th, 2025
Karsten Wenzlaff is a Crowdfunding and Fintech Expert from Germany. He is Secretary-General of Digit[...]
Category Archives: ESG, Financial Inclusion, Sustainable Finance
McKinsey Report: Diversity in Global Private Markets 2022 and Institutional Investors as Catalysts for Change
Report | Aug 23, 2023
Image: McKinsey report, State of Diversity in Global Private Markets 2022
The McKinsey report titled 'The State of Diversity in Global Private Markets 2022", presents new research that captures regional differences in diversity within private equity and discusses the role of institutional investors as catalysts for change.
Key Insights
- Scope of the report:
- The research focuses on diversity in the global private markets industry, particularly private equity (PE) firms and institutional investors (IIs).
- The study surveyed 42 PE firms and IIs globally and conducted interviews with industry leaders.
- Institutional Investors' Perspective: Chief investment officers (CIOs) of leading IIs would allocate twice as much capital https://ncfacanada.org/why-venture-capital-firms-need-more-women-partners-and-entrepreneurs/to a more gender-diverse PE firm when comparing two similar firms. More ethnically and racially diverse PE deal teams would receive 2.6 times as much capital.
- While 23% of all investing roles are held by women at PE firms globally,
- Only 12% are women at the managing director level.
- However, at diversity-leading firms, 32% of MDs are women, and 32% are ethnic and racial minorities.
See: Strategies for Addressing Canada’s Tech Talent Gap: Leveraging Micro-Credentials, Accessible Training Programs, and Diversity in Hiring
- Geographic differences exist across the pond.
- PE offices in the Americas have the highest share of women in the C-suite.
- APAC leads in women's representation in mid-level roles, and
- Europe leads slightly at entry-level investing roles.
- Even at senior levels, women and ethnic and racial minorities may not hold the same positions of power as their counterparts. PE investment committees report 9% women globally and 9% ethnic and racial minorities in Canada and the US.
- Institutional investors can be significant catalysts for change in diversity within PE, given the capital they allocate to PE firms. They are increasingly requesting diversity data from PE firms during fundraising.
Focus Areas for Institutional Investors as Catalysts for Change
1. Institutional Investors are increasingly asking for and receiving diversity data from private equity (PE) firms during their fundraising processes.
-
- Since PE firms raise significant capital from IIs, they are motivated to align their actions and strategies to IIs’ priorities, especially during capital raises. By requesting diversity data, IIs can influence PE firms to prioritize diversity within their teams.
2. Chief investment officers (CIOs) of leading IIs have indicated a preference to allocate more capital to PE firms with more diverse teams.
-
- For instance, they would allocate twice as much capital to a more gender-diverse PE firm when comparing two similar firms.
- By allocating more capital to diverse teams, IIs can incentivize PE firms to prioritize diversity. The data suggests that not only would diverse teams receive more funding, but there might also be a penalty for PE firms that lag peers on diverse talent.
See: CSA Seeking Comments on Proposed Changes to Governance and Disclosure Practices Around Diversity
3. Standardization of Diversity Metrics
-
- One of the challenges both IIs and PE firms face is the lack of standardized metrics for reporting diversity. This makes the reporting process labor-intensive for PE firms and difficult for IIs to compare data across multiple PE firms.
- Standardizing diversity metrics would streamline the reporting process, making it easier for PE firms to provide consistent data and for IIs to make informed allocation decisions based on that data.
4. Broadening the Scope of Diversity
-
- The current report primarily focused on gender and ethnic or racial diversity within PE firms. However, there's a recognition of several other categories that contribute to employee diversity.
- A broader understanding of diversity, including aspects like socioeconomic background, sexual orientation, etc., would provide a more comprehensive view of diversity within PE firms, allowing IIs to make more informed decisions.
Does It Make Sense for Institutional Investors (IIs)?
Yes, it does make sense for institutional investors to focus on these areas for several reasons:
- Diverse teams are known to bring varied perspectives, which can lead to better decision-making and risk assessment. By investing in diverse Private Equity (PE) firms, IIs can potentially mitigate investment risks.
- Many institutional investors have environmental, social, and governance (ESG) goals. Promoting diversity aligns with the social aspect of ESG, allowing IIs to meet their broader objectives.
See: McKinsey Report on Gender Diversity in Canada
- The research suggests that there might be a "diversity premium." IIs believe that diverse teams might lead to better investment outcomes, and therefore, higher returns on their investments.
- In the current socio-economic climate, there's a growing emphasis on diversity and inclusion. By promoting diversity, IIs can enhance their reputation and branding, making them more attractive to stakeholders.
In conclusion, it's not only a moral imperative but also a strategic one for institutional investors to act as catalysts for change in promoting diversity within the private equity industry. The landscape of private equity is undergoing a significant transformation, with diversity at its core. As institutional investors wield their influence, they not only champion a moral cause but also pave the way for a more inclusive, innovative, and successful future in private equity. The journey towards diversity is both a challenge and an opportunity, and with the combined efforts of all stakeholders, the industry is poised for positive change.
Participate in McKinsey's 2023 Study
Sign up to participate in McKinsey’s 2023 State of Diversity in Global Private Markets study: Sign up to participate
The National Crowdfunding & Fintech Association (NCFA Canada) is a financial innovation ecosystem that provides education, market intelligence, industry stewardship, networking and funding opportunities and services to thousands of community members and works closely with industry, government, partners and affiliates to create a vibrant and innovative fintech and funding industry in Canada. Decentralized and distributed, NCFA is engaged with global stakeholders and helps incubate projects and investment in fintech, alternative finance, crowdfunding, peer-to-peer finance, payments, digital assets and tokens, blockchain, cryptocurrency, regtech, and insurtech sectors. Join Canada's Fintech & Funding Community today FREE! Or become a contributing member and get perks. For more information, please visit: www.ncfacanada.org
 |  |  |
|---|---|---|
 |  |  |
Decarbonizing Insurance and the Adaptation of Carriers to a New Zero Economy
Insurtech | Aug 21, 2023
Image: Unsplash/Matt Palmer
The global transition towards a sustainable, net-zero carbon future is reshaping industries across the spectrum including insurance.
With projections indicating that the transition to a net-zero economy could account for more than $800 billion in annual global capital expenditures in renewable energies and decarbonization technologies by 2030, the stakes have never been higher. The insurance sector, traditionally rooted in age-old practices, now stands at the forefront of this transformation, poised to redefine its role in this green future.
See: Costanoa: Insurtech Investment Themes and Opportunities
The Green Imperative
- The urgency to address climate change and its devastating impacts has never been more pronounced. As global temperatures rise and extreme weather events become commonplace, the need for a sustainable future is clear. For the insurance industry, this presents a dual challenge:
- The move towards a net-zero carbon economy impacts every sector, including insurance. This shift is not just about mitigating risks but also about understanding and capitalizing on new opportunities, especially when considering the massive capital expenditures projected for the coming decade.
- At its core, the role of insurance is about safeguarding against uncertainties. With the changing climate landscape, carriers face new challenges in risk assessment and management. Addressing the protection gaps would necessitate hundreds of billions of dollars in capital, underscoring the magnitude of the financial challenge.
Innovative Offerings in a Net-Zero World
Governments, corporations, and individuals are all taking steps to reduce their carbon footprints. The insurance industry, traditionally seen as risk-averse, is now at the forefront of this green revolution, understanding the risks and potential rewards of a net-zero future.
- Green Infrastructure Coverage --> Urban spaces are increasingly integrating green structures like vertical gardens and green roofs. Tailored insurance products can address the unique risks associated with these eco-friendly installations.
- Renewable Energy Insurance --> The surge in renewable energy projects, from solar farms to wind turbines, necessitates specialized insurance products. These can cover potential equipment damages, business interruptions, and even underperformance risks.
See: How Conscious Spending Can Combat the Climate Crisis: Cogo’s Carbon Footprint Management
- Electric Vehicle (EV) Policies --> The shift to EVs in the automotive sector brings about unique risks. Insurers can craft policies that address EV-specific concerns, such as battery malfunctions or charging infrastructure damages.
- Carbon Credit Insurance --> As businesses invest in carbon credits to offset their emissions, there's a growing market for insurance products that protect against the invalidation of these credits or their market volatility.
- Sustainable Agriculture Coverage --> The agriculture sector's move towards sustainable practices, from organic farming to vertical agriculture, offers insurers a chance to develop coverage for these niche markets.
Examples
- Descartes Underwriting. This insurtech uses predictive data science techniques to assess the underlying drivers of natural catastrophes, providing better cover for those dealing with climate change. Their approach addresses the increasing risks posed by climate change that traditional insurance models struggle to capture.
See: French Neobank Startup, Green-Got, Collaborates with 1300 Crowdfunded Climate-Conscious Investors
- Flock. Flock offers fleet insurance and uses telematics data to help companies identify safety risks and promote safer driving. Their solution addresses the growing sectors of next-day delivery, on-demand courier services, and flexible leasing, all of which are undergoing rapid changes with the green transition.
- Kita. Kita is focused on the carbon market, offering insurance products that guarantee the quality and delivery of carbon units and carbon removal solutions. As the importance of carbon credits grows in a net-zero world, solutions like Kita's will become increasingly vital.
Calling the Insurance Industry....Evolve, Innovate, and Lead
The journey towards a net-zero world is both challenging and promising. For the insurance industry, it's a call to evolve, innovate, and lead. By understanding the green imperative and developing innovative offerings, insurers can not only navigate the challenges of a net-zero world but also seize the immense opportunities it presents.
Integrating data and insights, such as the projected $800 billion in capital expenditures by 2030, further emphasizes the scale and importance of this transition.
The National Crowdfunding & Fintech Association (NCFA Canada) is a financial innovation ecosystem that provides education, market intelligence, industry stewardship, networking and funding opportunities and services to thousands of community members and works closely with industry, government, partners and affiliates to create a vibrant and innovative fintech and funding industry in Canada. Decentralized and distributed, NCFA is engaged with global stakeholders and helps incubate projects and investment in fintech, alternative finance, crowdfunding, peer-to-peer finance, payments, digital assets and tokens, blockchain, cryptocurrency, regtech, and insurtech sectors. Join Canada's Fintech & Funding Community today FREE! Or become a contributing member and get perks. For more information, please visit: www.ncfacanada.org
| | |
|---|---|---|
| | |
Harnessing Decentralized Finance to Combat Climate Change: A New Era of Sustainable Finance
Video | Jul 21, 2023
Image: Solid World website
In an era where climate change poses significant threats to our planet, innovative solutions are more crucial than ever. One such solution lies in the intersection of decentralized finance (DeFi) and climate change mitigation.
DeFi is revolutionizing approaches to climate change solutions, delving into innovative financial models that promote sustainability while creating new opportunities for investment in a greener future.
Stenver Jerkku, the CEO of Solid World, is at the forefront of this revolution. With a background in urban space and venture-backed tech businesses, Jerkku is now focused on building capital markets to solve climate financing. His current venture, Solid World, aims to tackle the significant issues in the carbon industry, particularly in the voluntary carbon market which is primarily driven by investor pressure to decarbonize portfolios.
Companies are encouraged to reduce their emissions, but to become entirely carbon neutral, they often resort to carbon credits in the voluntary carbon market. These credits involve paying someone else to reduce their emissions or sequester emissions out of the atmosphere.
However, the carbon market faces significant challenges. The current market structure is nontransparent and unstructured, making it difficult for companies and investors to navigate. This lack of transparency and standards is holding back capital and preventing the market from reaching its potential.
To address these issues, Solid World is working on creating standards and transparency in the market. They have developed a risk due diligence framework for evaluating projects and are planning to open-source their underwriting methodology. Additionally, Solid World is creating liquidity pools to structure and price different types of assets, making the market more accessible and understandable for investors.
Several other companies are also contributing to this regenerative finance world. For example:
- Toucan is working on making spot trading transparent
- SAS Global is using AI to predict climate disasters
- Open Forest Protocol is bringing real-time monitoring to nature restoration projects.
See: Alternative forms of capital will be key to develop sustainable economic systems
The intersection of DeFi and climate change presents a new era of sustainable finance. By harnessing the power of DeFi, we can tackle climate change more effectively, promoting sustainability and creating new opportunities for investment in a greener future. As companies like Solid World continue to innovate and push for transparency and standards in the carbon market, we move one step closer to a sustainable future.
The National Crowdfunding & Fintech Association (NCFA Canada) is a financial innovation ecosystem that provides education, market intelligence, industry stewardship, networking and funding opportunities and services to thousands of community members and works closely with industry, government, partners and affiliates to create a vibrant and innovative fintech and funding industry in Canada. Decentralized and distributed, NCFA is engaged with global stakeholders and helps incubate projects and investment in fintech, alternative finance, crowdfunding, peer-to-peer finance, payments, digital assets and tokens, blockchain, cryptocurrency, regtech, and insurtech sectors. Join Canada's Fintech & Funding Community today FREE! Or become a contributing member and get perks. For more information, please visit: www.ncfacanada.org
| | |
|---|---|---|
| | |
Millennial and Gen Z Workforce Demand Purpose-Driven Work: Deloitte Survey Insights
Fortune | Elizabeth Faber | Jul 6, 2023
Image: Unsplash/Eliott Reyna
Ethical alignment and purpose-driven work significantly influences career decisions of Gen Z and Millennials
- Deloitte's latest Global Gen Z and Millennial Survey reveals that nearly 40% of respondents have rejected work assignments due to ethical concerns, and over a third have declined offers from employers they perceive as lacking in areas such as environmental responsibility, diversity, equity, and inclusion (DEI), or mental health initiatives.
- This underscores the importance of ethical alignment between employees and their organizations, a factor that significantly influences career decisions among younger generations.
- Purpose-Driven Work is a Must:
- The survey indicates that over 80% of Deloitte's global workforce, approximately 330,000 employees, belong to the Millennial and Gen Z demographics.
- These generations are not satisfied with merely working for purpose-driven organizations; they want to actively participate in driving societal change through their work.
- However, only half of the respondents feel empowered to drive change within their organizations, highlighting a gap that employers need to address.
Emerging Investors: Gen Z Canadians Take the Lead in Global Investment Trends
Fintech Fridays EP55: Global Hiring Trends: How Gen Z Talent Thrives
- Climate Action:
- Over half of the respondents research a company's environmental impact and policies before accepting a role, and a quarter plan to change jobs or sectors due to climate concerns.
- Only 15% of Gen Z and Millennial respondents feel they can influence their organization's sustainability efforts.
Organizations must prioritize purpose and impact, promote ethical alignment, and empower employees to drive change. This not only secures long-term commitment from these generations but also creates financial and social value for the organization.
View more --> here
Download the 38 page PDF Survey report --> here
The National Crowdfunding & Fintech Association (NCFA Canada) is a financial innovation ecosystem that provides education, market intelligence, industry stewardship, networking and funding opportunities and services to thousands of community members and works closely with industry, government, partners and affiliates to create a vibrant and innovative fintech and funding industry in Canada. Decentralized and distributed, NCFA is engaged with global stakeholders and helps incubate projects and investment in fintech, alternative finance, crowdfunding, peer-to-peer finance, payments, digital assets and tokens, blockchain, cryptocurrency, regtech, and insurtech sectors. Join Canada's Fintech & Funding Community today FREE! Or become a contributing member and get perks. For more information, please visit: www.ncfacanada.org
| | |
|---|---|---|
| | |
How Conscious Spending Can Combat the Climate Crisis: Cogo’s Carbon Footprint Management
Cogo | Jul 5, 2023
Image: Cogo
Cogo aims to inspire individuals, businesses, and financial institutions to reduce their carbon footprint and contribute to a sustainable and fairer world.
They achieve this by helping everyone understand how their spending affects the climate crisis and driving change on a global scale through partnerships with financial institutions.
- Cogo started as 'Conscious Consumers' in 2011, indicating a decade-long commitment to sustainability and positive impact.
- Cogo's carbon footprint for 2021-2022 was 18.35t CO2e, including scope 1, 2, and 3 emissions.
- They are a Toitū Net Carbon Zero certified organization, demonstrating its commitment to carbon neutrality.
- Cogo has set a target to reduce its total reported absolute Scope 1 + 2 + 3 emissions by 30% by 2030, aligned with the Science Based Targets initiative’s SME Target Setting guidance.
- They have been a Certified B Corporation since 2019, and is a Living Wage certified employer in both the United Kingdom and New Zealand, showing its commitment to social responsibility and fair wages.
Read: Patagonia: Earth is now our only shareholder
The National Crowdfunding & Fintech Association (NCFA Canada) is a financial innovation ecosystem that provides education, market intelligence, industry stewardship, networking and funding opportunities and services to thousands of community members and works closely with industry, government, partners and affiliates to create a vibrant and innovative fintech and funding industry in Canada. Decentralized and distributed, NCFA is engaged with global stakeholders and helps incubate projects and investment in fintech, alternative finance, crowdfunding, peer-to-peer finance, payments, digital assets and tokens, blockchain, cryptocurrency, regtech, and insurtech sectors. Join Canada's Fintech & Funding Community today FREE! Or become a contributing member and get perks. For more information, please visit: www.ncfacanada.org
| | |
|---|---|---|
| | |
FCA Speech: Adapting Culture to Meet Changing Societal Norms and Consumer Expectations
FCA | June 26, 2023
Speech by Emily Shepperd, Chief Operating Officer and Executive Director of Authorisations, delivered online at the Westminster Business Forum
- In Emily Shepperd's speech she emphasizes the importance of evolving organizational culture to address generational differences and societal norms.
- She stresses the importance of evolving organizational culture to meet changing societal norms and consumer expectations. This includes fostering an inclusive culture that values diversity of thought and experience, ensuring that regulations align with these changing demands, and moving away from outdated practices that are no longer socially acceptable.
- She believes that these changes can help to create more resilient, sustainable, and customer-focused organizations.
See: Culture: Why regulators should care about diversity and inclusion
- Select quotes and insights:
- Importance of listening, especially for leaders, to create an environment where people feel comfortable to speak up, share their experiences, and provide meaningful challenge. This fosters diversity of thought and helps to drive better outcomes for firms and their customers.
- Companies should ask tough questions when assessing the fitness and propriety of staff in financial services. The FCA views culture as crucial for confidence and can dictate bottom lines.
- As Warren Buffett said: 'It takes 20 years to build a reputation and five minutes to ruin it. If you think about that, you'll do things differently.'
- On Culture:
- Culture remains central to our supervisory model and underpins conduct and therefore business performance and confidence.
- Culture is not just the slogan on your website. It is the very essence of what your organisation stands for, embodied by how it conducts itself.
- Increasingly, investors are demanding that they put their money towards 'doing some good’ for people and our planet.
- On recruitment: A recent study by Workplace Intelligence found that 74 % of millennial and Gen Z employees would quit a job in a year if there were no opportunities for upskilling and development.
Read the full speech --> here
The National Crowdfunding & Fintech Association (NCFA Canada) is a financial innovation ecosystem that provides education, market intelligence, industry stewardship, networking and funding opportunities and services to thousands of community members and works closely with industry, government, partners and affiliates to create a vibrant and innovative fintech and funding industry in Canada. Decentralized and distributed, NCFA is engaged with global stakeholders and helps incubate projects and investment in fintech, alternative finance, crowdfunding, peer-to-peer finance, payments, digital assets and tokens, blockchain, cryptocurrency, regtech, and insurtech sectors. Join Canada's Fintech & Funding Community today FREE! Or become a contributing member and get perks. For more information, please visit: www.ncfacanada.org
| | |
|---|---|---|
| | |
Navigating the Information Ecosystem: The UN’s Code of Conduct for Digital Platforms (Policy 8)
IISD | Jun 22, 2023
The United Nations is developing a Code of Conduct for Information Integrity on Digital Platforms, aimed at creating a safer, more inclusive digital space.
- The Code of Conduct is intended to be a gold standard for information integrity.
- It defines information integrity as the accuracy, consistency, and reliability of information.
- The digital age has amplified the spread of misinformation, disinformation, and hate speech, polluting the information ecosystem and posing significant threats to democracy, human rights, and sustainable development.
See: Human Rights and Artificial Intelligence Governance
- This initiative proposes 8 principles to counteract these challenges:
- Commitment to information integrity
- Respect for human rights
- Support for independent media
- Increased transparency
- User empowerment
- Strengthened research and data access
- Scaled up responses
- Stronger disincentives
- Enhanced trust and safety
- The Code of Conduct will be developed through stakeholder consultations and could include the establishment of an independent observatory made up of recognized experts to assess the measures taken by the actors who commit to the Code of Conduct.
Continue to the full article --> here
Download the 29 page PDF report on Information Integrity on Digital Platforms --> here
The National Crowdfunding & Fintech Association (NCFA Canada) is a financial innovation ecosystem that provides education, market intelligence, industry stewardship, networking and funding opportunities and services to thousands of community members and works closely with industry, government, partners and affiliates to create a vibrant and innovative fintech and funding industry in Canada. Decentralized and distributed, NCFA is engaged with global stakeholders and helps incubate projects and investment in fintech, alternative finance, crowdfunding, peer-to-peer finance, payments, digital assets and tokens, blockchain, cryptocurrency, regtech, and insurtech sectors. Join Canada's Fintech & Funding Community today FREE! Or become a contributing member and get perks. For more information, please visit: www.ncfacanada.org
| | |
|---|---|---|
| | |
