23_8004_FR_COP_Venturing_for_climate_FINAL.pdf

VENTURING
FOR CLIMATE
Venture Capital’s response
to the climate emergency

With global greenhouse gas emissions up by almost half since 1990,
the world is headed towards climate disaster unless urgent action is taken.
Having become alert to the crisis, world leaders set a target in the shape of
the Paris Agreement to limit the increase in global temperatures to 1.5°C
above pre-industrial levels, Implying a reduction in emissions by 45%
by 2030 and achieving net zero emissions by 2050. These goals appear
increasingly difficult to achieve, as countries struggle to fulfill their
commitments, these goals appear increasingly difficult to attain.
To change that trajectory, authorities around the world are tightening
regulations. But this green transition, one of the most complex challenges
facing humanity, also requires substantial innovation and structural
investment. The European Union estimates that the investment required
in the EU by 2030 will be around EUR 8 trillion, not accounting for inflation
or growth.
Where will that money come from? Around one-quarter will be sourced
from the public sector. However, the vast majority of it will have to come
from private capital. Acting directly alongside the most innovative startups,
Venture Capital is at the forefront, and has a major role to play as a catalyst
for the green transformation: investing in innovative solutions, actively
transforming companies, and generating returns for limited partners,
all at once.
In this study, we look at the current climate momentum happening in the
tech ecosystem, as well as the way Venture Capital firms are integrating
climate concerns into their activities. We conclude by outlining the
challenges facing the ecosystem in the year to come.
INTRODUCTION
2 Venturing for climate

Photo
de
couverture
Flavio
Coelho
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Getty
Images
TABLE OF CONTENTS
29
CONCLUSION
30
METHODOLOGY
4
1. FOREWORD: BEYOND ESG
The rise of climate concerns in the tech
ecosystem
8
2. WHY DO VC FUNDS TAKE ACTION?
A historical momentum across
the tech ecosystem
9 1.1 Entrepreneurs innovating for climate
10 1.2 Regulation setting the ecosystem in motion
12 1.3 LPs increasing their concerns
14 1.4 VC funds stepping-up
24
4. WHAT’S NEXT?
Towards tomorrow’s
Venture Capital
25 3.1 Upskilling the ecosystem
26 3.2 Creating reporting standards
27 3.3 Inventing new funding models
16
3. HOW DO VC FUNDS TAKE ACTION?
An integration of climate throughout
investment lifecycles
17 2.1 Orientating capital through investment policies
19 2.2 Leveraging influence power for good
22 2.3 Leading by example
Venturing for climate 3

1
FOREWORD
BEYOND ESG
The rise of climate concerns in the tech ecosystem

Over the past decade, Venture Capital, similarly to other
investment spheres such as private equity and publicly
traded investments, has undergone a significant profes-
sionalization in ESG matters. This newfound awareness
has been fueled by several simultaneous factors, driving
the industry towards a more responsible and sustain-
able approach to investment.
First, public awareness and scrutiny regarding Corpo-
rate Social Responsibility (CSR) has significantly
increased, which has led to a demand for economic ac-
tors to integrate social, environmental and governance
concerns into their agendas with greater transparency.
This new concern has been accompanied and accelerat-
ed by a regulatory push: the ESG regulatory landscape
experienced an exponential growth over the past few
years on global, European and national levels, progres-
sively enforcing ESG reporting to smaller and less ma-
ture companies. →A
A | The ESG regulatory landscape experienced an exponential growth, intensifying over the last 2-3 years
and further accelerated by Covid-19
Evolution of regulatory landscape globally [# of policy interventions; 1970-2022]
Source: UNPRI, desk research, Roland Berger
Key development in ESG Events [non-exhaustive]
2025
2022 ...
2020
2015
2005
2000
1990
1985
1970
1985
Ozone
hole
detected
1987
Definition
of the term
“sustainability”
1990
Creation of the
first ESG Index
Fund
2000
Start of Global
Reporting
Initiative (GRI)
2006
Launch of UN
Principles for
Responsible
Investment (PRI)
2020
Launch of EU
taxonomy for
sustainable
activities
2021-2022
Launch of the EU
Sustainable Finance
Disclosure Regulation
(SFDR) and Corporate
Sustainability Reporting
Directive (CSDR)
<10 policy
interventions
~700 policy
interventions
2015
Launch of Sustainable
Dvlp. Goals, signature
of the Paris agreement
and launch of Task Force
on Climate Related
Financial Disclosures
(TCFD)
1989
Exxon
Valdez oil
spill
2019
Wildfires in
Australia
Floods
across the
globe (DE,
BE, CN)
2021
1996
Nike sweatshop
labor scandal
2010
Haiti earthquake
2020
Covid impact – acceleration
of policy interventions
(+120 policies from 2020
to 2021)

As a result, including ESG criteria in investment policies
and reporting on ESG criteria has become a baseline for
all VC players. → B
Within ESG concerns, one grabbed public attention in a
very particular manner in the past years: climate. Lately,
climate change has become a prominent topic in public
debates. Key milestones such as the 2015 Paris agree-
ment, successive reports from the IPCC, and extreme
weather events experienced in Europe during the
summer of 2022, have raised awareness of the urgency
of the situation, making it evident to most that immedi-
ate action is necessary. → C
For regulators, rating agencies, and limited partners, the
various aspects of the fight against climate change are
embedded in ESG frameworks. While this study focuses
specifically on the climate aspect within the “E” for Envi-
ronmental, it is important to note that ESG as a whole is
highly relevant and should not be underestimated.
B | Investors increasingly monitor the ESG performance of companies to assess their sustainability
prospects
Financial institutions – Assets managed by investment firms integrating ESG factors [USD tr]
Source: Sustainalytics, Roland Berger
2006
150
7
2010
800
21
2014
1,400
45
2008
500
14
2012
1,150
32
2016
1,600
62
2019
2,300
86
2007
250
10
2011
950
25
2015
1,500
59
2018
2,000
82
2009
650
18
2013
1,250
34
2017
1,750
68
2020
3,000
103
Assets under management integrating ESG factors
# of investment firms who signed to integrate ESG factors into their investment decisions

Source: Roland Berger
C | Climate action is part of ESG
The Roland Berger ESG framework
Natural resources
Energy
efficiency
Emissions
Pollution &
waste
Greentech
innovation
Focus due to high
importance for the
green transformation
Diversity, equity &
inclusion (DE & I)
Employee
wellbeing
Human rights
Society &
community
Product liability
Transparency &
reporting
Compliance &
business ethics
Supply chain governance
Compensation policy
Structure & oversight
OVERNANCE
OCIAL
NVIRONMENTAL
G
S
E

WHY DO
VC FUNDS
TAKE ACTION?
A historical momentum across the tech ecosystem
2

The tech ecosystem is undergoing a significant shift to-
wards sustainability. Startups, investors, regulators and
VC funds are all stepping up to tackle the urgent issue of
climate change. As Pierre-Yves Meerschman, co-founder
of Daphni once said, “from little streams, great rivers are
formed”. These small initiatives by stakeholders are
coming together and forming a river, leading to a wave
of change. The momentum towards a sustainable future
is gaining strength and VC funds are realizing that it is
time to act. Beyond marketing, a groundswell of com-
mitment and action is taking shape, and it has become
impossible to ignore.
2.1 ENTREPRENEURS
INNOVATING FOR CLIMATE
At the forefront of innovation, entrepreneurs are spear-
heading the changes in our society including digitaliza-
tion, new mobilities or new ways of consuming. They
are also at the forefront of the climate concern move-
ment. The emergence of startups committed to a more
sustainable future is accelerating the increase of climate
awareness in our society. Many of these startups, led by
younger entrepreneurs, aim to address the concerns of
the climate generation and popularize terms like
cleantech, greentech and climate tech. 2021 saw a re-
cord-breaking USD 111 bn investment in climate tech by
startups and scaleups worldwide1
.
“The most ambitious entrepreneurs aim at addressing the
problems in our societies, and the main issues today are re-
lated to climate” analyzes Thomas Poitrineau, Principal
at EQT Ventures.
The startup industry is experiencing a new generation
of companies with different business models. While
software and SaaS business models have driven and
1 TechNation, Climate Tech Report 2022
«The momentum in the deep tech industry is
undeniable. Europe boasts an excellent
scientific ecosystem, and the quality of
entrepreneurs is increasing, with the best
talent leaving traditional careers for
entrepreneurship. Large corporations have
realized that innovation comes from
startups, and authorities recognize that
Europe’s sovereignty will be enhanced by
funding startups in strategic industries. We
are also seeing a clear shift in VC funding
towards deep tech and climate tech, driven
by both ethical and opportunistic reasons.»
Michel de Lempdes, Managing Partner Venture Capital,
Omnes Capital
WITNESSING VC SHIFT
TOWARDS DEEPTECH
Omnes Capital
continue to fuel the growth of the industry, emerging
startups are more scientific, DeepTech oriented, and in-
dustrial. Consequently, addressing climate change re-
quires discussions on decarbonization, energy transi-
tion and scientific matters.
VC funds are starting to adapt to this new landscape,
shifting from their usual targets to new types of invest-
ments. While this approach requires extensive research
and development processes, hardware assets and differ-
ent risk-return trajectories, financing such assets is cru-
cial to effectively address the challenges of the future.

Today, founders have also become aware of the relevance
of environmental concerns. In order to stay competitive
and attract top talent, it is imperative to demonstrate a
commitment to sustainability.
2.2 REGULATION
SETTING THE ECOSYSTEM IN MOTION
Applicable to all financial market participants and fi-
nancial advisors in the European Union, including asset
managers and investment firms, the leading regulation
in this area is the European Sustainable Finance Disclo-
sure Regulation (SFDR).
Launched in March 2021, the SFDR provides asset EU
managers and funds with a clear framework for integrat-
ing environmental factors into their decision-making
processes, driving the industry towards new reporting
and transparency standards.
All fund partners interrogated agreed that this is a step
in the right direction. The regulation has several bene-
fits. Firstly, setting clear categories limits greenwashing
and prevents funds from advertising their “green”,
“ESG”, or “impact” characteristics without common cri-
teria. Secondly, it wields significant signaling power, es-
pecially towards LPs. All fund partners insist that rais-
ing an Article 6 fund has become almost impossible
today, making it imperative for VC funds to structure
and professionalize their approach to ESG reporting. In
the same logic, becoming Article 9 is seen by some as a
differentiating factor to raise funds, as “LPs have dedi-
cated pockets for these types of investments.” As a result,
the SFDR has boosted the integration of ESG criteria,
especially climate-related criteria in funds policies.
Although it is positively oriented, complying with the
SFDR remains burdensome for most funds. 51% of re-
spondents consider compliance with the regulatory
SFDR in a nutshell
The EU SFDR is designed to help investors navi-
gate the many sustainable investment funds/
strategies available in the EU, by providing trans-
parency on the degree to which financial products
consider environmental and/or social characteris-
tics, invest in sustainable investments or have
sustainable objectives.
The EU SFDR imposes asset managers and
investment companies to disclose their stance
regarding their treatment of Sustainability Risks
and Principal Adverse Impacts. The level of disclo-
sure varies depending on the degree to which
sustainability is a consideration. The SFDR results
in three different product categorizations:
• “Article 6” products either integrate financially
material environmental, social and governance
(ESG) risk considerations into the investment
decision-making process, or explain why
sustainability risk is not relevant, but do not
meet the additional criteria of Article 8 or
Article 9 products.
• “Article 8” products promote social and/or
environmental characteristics, and may invest
in sustainable investments, but do not have
sustainable investing as a core objective.
• “Article 9” products have a sustainable invest-
ment objective.
Source: JP Morgan, Roland Berger

framework rather highly constraining. Indeed, measur-
ing sustainability risks and PAI can be a complex en-
deavor, especially considering the low maturity of port-
folio companies. → D
In addition, the regulatory landscape remains in its ear-
ly stages and has been clarified through several comple-
mentary publications. The Regulatory Technical Stan-
dards (RTS) to be used when circulating sustainability-
related information were adopted by the European
Commission in April 2022 and came into force on Janu-
ary 1st, 2023. The Taxonomy Regulation, complement-
ing SFDR, was partially completed in July 2022 on the
environmental side and still lacks specific guidelines for
social and governance factors.
Faced with this changing regulatory framework, VC
funds are learning as they go. As Stéphanie Chrétien,
Partner at Demeter, confides, “The regulation is chang-
ing, with certain aspects still awaiting clear direction
from the regulator. The taxonomy for example remains
incomplete. We are all learning by doing, but overall,
the changes are heading in the right direction”. Several
funds displayed as Article 9 at first have since then de-
cided to downgrade to Article 8, faced with the difficulty
of complying with the requirements.
“The regulation is evolving, overall, in the right
direction. It is not yet stabilized, but we already
see many funds moving from Article 6 to
Article 8, including Partech. The level of
perceived constraint linked to regulation varies
greatly from one fund to another. Some funds
may view compliance as highly constraining,
while others believe that it is not stringent
enough. It depends on the ambition they set to
themselves, level of maturity on addressing
ESG topics of the funds, level of maturity of
their portfolio companies and ability they have
to influence their companies to take ESG
actions. For example, Article 9 funds must
display objectives in terms of alignment with
sustainability criteria but are free to set this
target themselves.”
Rémi Said, Co-founder & General Partner, Partech Impact
WELCOMING THE ONGOING
PROGRESS IN REGULATION
Partech Impact
D | Today, how constraining/complex is it for your
organization to comply with climate-related
regulations? (e.g. SFDR, EU taxonomy)
Source: STATION F & Roland Berger survey, 2023
Rather
constraining
38.2%
Highly
constraining
14.7%
Not so much
32.4%
Not at all
14.7%

Furthermore, the regulatory framework around sus-
tainable investment is likely to be strengthened in the
years to come, considering the urgency of climate is-
sues. 74% of all interrogated VC funds expect the regu-
latory framework to become more constraining in the
next 5 years. However, 40% consider that it will create
opportunities. → E
2.3 LPS INCREASING THEIR CONCERNS
LPs have substantial power in the tech ecosystem
through their funding requirements, but their levels of
awareness and demands regarding environmental is-
sues differ significantly.
“While the SFDR may not be flawless, it has
set a valuable framework and raised the
expectations of investors, thus successfully
pushing VC funds to consider environmental
issues in a more structured and committed
way. Fortunately, VC funds are very agile
organizations, and the ecosystem has a culture
of action. Collectively, we are able to react very
quickly to regulatory changes and adapt as the
framework evolves. Moreover, we can count on
dynamic industry players such as France
Digitale and FranceInvest to leading place-
based initiatives and foster discussions
among peers.”
Garin Pitzini, Chief Financial & Sustainability Officer, Newfund
LEVERAGING THE AGILITY
OF VC FUNDS
Newfund
VC fund partners describe LPs’ climate commitment as
a diverse group, with varying levels of awareness and en-
gagement, depending on their category. Institutional
investors (such as insurers, asset managers, state enti-
ties and corporates) face more rigorous reporting re-
quirements, which makes them more demanding. How-
ever, family offices and high net worth individuals, with
some exceptions, are generally less concerned. A new
generation of leaders with strong convictions could
shift the balance significantly in the coming years.
E | In the next 5 years, how do you expect the
integration of climate-related criteria in funds
investment choices to evolve?
(with multiple choice)
Become much more constraining 41.2%
Open up opportunities 38.2%
Become slightly more constraining 32.4%
Remain as constraining 0%

However, the current situation for cleantechs is much
more favorable than in the past. Firstly, there is an un-
precedented momentum for these types of technologies
as well as a strong market appetite for them. Secondly,
the business models for climate techs today significant-
ly differ from those of the previous wave. This mainly
generated revenue from incremental emissions reduc-
tion and limited their scaling potential. Lastly, the
track-record for these technologies is developing quick-
ly, with exits providing increased confidence in the sec-
tor. “Two years ago, the track-record was still in everybody’s
minds. Today, the situation is entirely different” confirms
Stéphanie Chrétien, partner at Demeter.
“We note a strong market traction on the
climate theme, with a real appetite from
investors, a growing depth of deal flow and
real interest internally. However, while ESG
criteria in the broadest sense have become a
baseline for all LPs, less than half of them
make climate issues a differentiating criterion
to date. Some public and private institutional
investors are strongly committed to these
issues, but this is not the case for the majority.”
Emanuele Levi, General Partner &
Alexandre Mordacq, General Partner, 360 Capital
WITNESSING LPS HETEROGENEITY
360 Capital
The climate awareness of investors also varies by geog-
raphy, with European investors leading the charge. In-
vestors in the US and Asia are curious about develop-
ments in this area but have yet to adopt the same level
of demands as their European counterparts.
Many VC funds remain cautious when it comes to in-
vesting in cleantech due to past track-record and fear of
negative impact on profitability. In the 2010s, the first
wave of cleantech investment did not deliver expected
returns, leaving traces in LPs and VCs memories. More
than half of respondents to the web survey still report
fear of negative impact on returns as a factor limiting
the integration of climate-related criteria in investment
activity. Several partners confirmed that some LPs still
need to be convinced of the business case of climate
investment.
“The VC industry experienced a wave of climate
funds in the 2010s, which did not meet with the
expected success (e.g. Kleiner Perkins in the
US). This history is still in LPs minds today.
Today, a new groundswell of interest is
emerging on climate change issues, and new
teams are forming around these topics, but it is
still necessary to convince LPs that climate
projects can bring the expected profitability.”
Guillaume Meule, Managing Partner, XAnge
RECONCILING CLIMATE
AND FINANCIAL PERFORMANCE
XAnge

G | How has the integration of climate-related
issues evolved in the past 5 years in the VC
community (i.e. integration in investment criteria,
adoption of internal policies, dedicated support to
portfolio companies)?
Significantly
increased
61.8%
Radically
increased
11.8%
Slightly
increased
26.5%
No change
0%
F | How is the VC industry as a whole reacting
to climate issues?
How has the awareness (i.e. knowledge and
concern) regarding climate-related issues evolved
in the past 5 years in the VC community?
Significantly
increased
70.6%
Slightly
increased
11.8%
Radically
increased
17.6%
No change
0%
Driven primarily by regulation and marketing, LPs are
now moving towards a more environmentally conscious
investment approach, sparking a wave of reporting and
professionalization in measuring environmental and
climate impact across the ecosystem.
This trend is primarily motivated by regulatory require-
ments and marketing considerations, and LPs are de-
manding more thorough and professionalized methods
for measuring the environmental and climate impact of
their investments. This is driving a way of reporting as
well as professionalization across the investment
ecosystem.
2.4 VC FUNDS STEPPING UP
Just like other players in the ecosystem, VC funds are
also grappling with the issue of climate change. While
all funds recognize the increasing importance of this
issue for themselves and their portfolio companies,
there are varying levels of maturing among them in ad-
dressing it. → F, G
Although some VC funds continue to consider climate
concerns primarily as a marketing issue, most have rec-
ognized the urgency to take action and professionalize
their approach. This shift is mainly motivated by a com-
bination of ethical considerations, financial imperatives
and regulatory compliance obligations. According to our
web survey, a large majority of respondents (88%) have
experienced a significant to radical increase in aware-
ness of environmental issues and 74% have observed a
significant to radical increase in the integration of sus-
tainability considerations into investment policies.

The wave of change towards climate-friendly invest-
ments is also being propelled by investment teams with-
in VC funds. In particular, the new generation of profes-
sionals who are more cognizant of the significance of
addressing climate change are leading the charge for
greater integration of sustainability considerations into
investment processes. 94% of respondents to the previ-
ously mentioned web survey noted that VC funds teams
are advocating for climate-friendly investments (either
slightly or significantly), vs. 85% for VC funds manage-
ment and startups, and 79% for limited partners. → H
H | Today, how constraining/complex is it for your
organization to comply with climate-related
regulations? (e.g. SFDR, EU taxonomy)
Limited
Partners
VC funds
management
VC funds
teams
Startup
ecosystem
14.7% 5.9% 14.7% 20.6%
32.4%
52.9%
55.9%
35.3%
52.9%
41.2%
29.4%
44.1%
Significantly Slightly Not so much
“Investment teams, particularly the younger
generation, are calling for more climate-
focused investment. We feel a strong internal
push from our teams, driven by a high
awareness on the topic and an appetite to be
part of the solution. The demand is very strong
for more responsible, sustainable, and
specifically climate-oriented investment.”
Benoist Grossman, Managing Partner Venture Capital, Eurazeo
WELCOMING AWARENESS
COMING FROM THE INSIDE
Eurazeo

3
HOW DO
VC FUNDS
TAKE ACTION?
An integration of climate throughout investment lifecycles

3.1 ORIENTATING CAPITAL
THROUGH INVESTMENT POLICIES
Through their investment policies, VC funds hold the
power to effectively orientate capital to particular types
of investments. With growing awareness among LPs
and a supportive regulatory framework, VC funds are
adapting their processes by incorporating sustainability
criteria into their investment strategies. Today, most
raised funds comply with the Article 8 standard at a
minimum. The integration of sustainability criteria var-
ies greatly across funds and encompasses a broad range
of mechanisms throughout the investment process,
from screening potential targets to closing deals. While
some mechanisms are becoming market practice, each
fund establishes its own investment process and inte-
grates climate-related criteria to a different level.
In the screening stage, it has become customary in the
market to adopt exclusion lists to preclude investment
consideration in particular industries, such as weapons
or fossil energies. However, this approach can be taken
one step further. At Revaia, in addition to the exclusion
list, a list of sectors with sustainability risks has been
established, including AI (Artificial Intelligence), block-
chain, and crypto. For companies operating in these sec-
tors, Revaia conducts a specific analysis of risks and po-
tential, supporting only those capable and willing to
transform the practices of their industry, and excluding
many high-potential companies in AI or blockchain
with excessive carbon footprints or insufficient sustain-
ability efforts.
There is a growing number of funds that are also specif-
ically seeking out industries or startups that demon-
strate a positive impact on the climate. The extent and
nature of this integration may vary. Some funds incor-
porate climate-related verticals in their investment strat-
egy (e.g., sustainable industry, energy transition, etc.),
and others even allocate a dedicated and fixed pocket of
investment (‘Article 8+’ funds). Going even further, some
funds are exclusively dedicated to impact-native compa-
nies, commonly referred to as impact funds. These
funds are defined by the Global Impact Investing Net-
work (GIIN) and adhere to specific criteria related to in-
tentionality, additionality, and measurability. → I
At the investment selection stage, most funds conduct
Due Diligence assessments on ESG matters, However,
only a fraction of them include climate-related consider-
ations. However, their practices vary, ranging from sim-
ple questionnaires to in-depth analyses that may require
third-party expertise. → J, K
One of the primary challenges faced by funds is the elab-
oration of the questionnaires, that need to be adapted to
very young companies, with highly variable business
models.TheKPIsandmetricstocollectvarygreatlyacross
industries and types of companies. It is therefore critical
to develop dedicated tools for growing companies.
I | Do you specifically consider companies climate
impact in your target screening process?
Yes
85.3%
No
14.7%
Doesn’t know
0%

J | Do you conduct ESG Due Diligence?
K | Do you conduct Due Diligence
on climate issues specifically?
On a regular
basis
67.6%
Rarely
8.8%
Sometimes
20.6%
Never
2.9%
On a regular
basis
47.1%
Never
14.7%
Sometimes
29.4%
Rarely
8.8%
“Environmental reporting cannot be the same
for early-stage startups as it is for growth
stage or larger companies. For this reason, we
have developed a specific ESG Due Diligence
with a third-party specialized in startup rating.
It is adapted to early-stage companies, with a
particular focus on intentionality.
When talking ESG Due Diligence, we believe it
is crucial to conduct it before the investment,
to anchor the ESG theme from negotiations
stage onwards, and to have it done through
a third-party, as to avoid potential bias.”
Louisa Mesnard, CMO, Elaia
DEVELOPING TOOLS
ADAPTED TO THE EARLY STAGE
Elaia
Finally, ESG issues at large, and particularly climate is-
sues, have begun to feature in legal documentation. In
the very definition of the VC-startup relationship, term
sheets and shareholder agreements are increasingly
incorporating environmental criteria and clauses.
These provisions may include requirements to priori-
tize such issues on the agenda, align with established
roadmaps, or take further steps, such as mandating
the measurement of carbon footprint. → L
3.2 LEVERAGING INFLUENCE POWER FOR GOOD
Besides having the power to allocate capital, VC funds
can act in the ecosystem by leveraging their unique influ-
ence power. As board members of portfolio companies,

VC funds have a real say in the development of their in-
vestments and can use their influence to infuse best
practices from an early stage.
Companies’ commitment to climate issues generally
starts from a rise of awareness, and VC funds have a role
to play in educating startups on such matters. An in-
creasing number of VC funds is offering training, webi-
nars, and workshops on related topics. At Revaia or Ser-
ena, part of the investment team is made of trainers of
the Climate Fresk, and train teams of portfolio compa-
nies. In addition to training, a key lever in the toolbox is
“measuring”. Awareness and action are ignited with un-
derstanding and thus measuring companies’ impact,
both positive and negative, on climate. Funds can infuse
change in their portfolio companies by simply asking
for data and thus initiating discussions, reflections and
L | Do you specifically include climate impact
criteria in your investment documentation
(term sheets, shareholder agreements)?
Yes
64.7%
No
32.4%
Doesn’t know
2.9%
“Impact goes far beyond SFDR nomenclature: it
is not the article that gives the mission. When
we invested in Back Market, the core of the
discussion was about the intention, the mission
of the company, rather than on operational
details related to reporting. It is very important
to maintain a sense of proportionality in
reporting: at its early stage, Back Market wasn’t
able to measure its carbon footprint, but the
business model was always inherently
sustainable. What matters at first is product
market fit, agility to sustain growth and
profitability perspective ; measuring should
come second, when company
size allows generation of relevant data.”
Pierre-Yves Meerschman, Co-founder & Partner, Daphni
MEASURING IMPACT
IN EARLY STAGE
Daphni
ultimately action. In many cases, simply asking the
question can set an ecosystem in motion. Funds can
also leverage the relationship and work done during
ESG Due Diligence phase to build or help build ESG and
Climate roadmaps, supporting startups in identifying
the most important actions to take and KPIs to follow.
However, reporting is a double-edged sword, and can re-
main a constraint for entrepreneurs if not kept propor-
tionate and followed-up on. Therefore, finding the right
level of reporting is key. “It has to go beyond simply collect-
ing data. It is important to show portfolio companies that
this topic is not incidental, but critical: all tenders they
might answer to in coming years will include climate criteria.

“VC funds have a real role to play in educating
and engaging the ecosystem. This starts simply
with reporting, measuring and continues by
addressing the topic at Board level and setting
ambitious targets and roadmaps. We observe,
in our portfolio, that companies that have
written targets are the ones that make the
most progress. The simple act of asking a
question increases awareness and can produce
a strong snowball effect. For example, when
companies assess the scope 3 of their carbon
footprint, they ask their clients and suppliers
about their own initiatives, and thus become
drivers of change in the industry.”
Bettina Denis, Head of Sustainability, Revaia
MEASURING TO SET
AN ECOSYSTEM IN MOTION
Revaia
“Venture capital funds have a unique potential
for impact due to their board seats and direct
contact with startups management teams.
They have a more direct influence on portfolio
companies compared with other asset classes
such as publicly traded investments.
This influence can be leveraged to infuse good
practices, notably regarding climate and ESG.”
Pierre-Emmanuel Struyven, Président, Supernova Invest
LEVERAGING VCs’ POWER
OF INFLUENCE
Supernova Invest
It also goes with showing that we care” says Bettina Denis,
head of Sustainability at Revaia. Certain funds choose to
focus on a few key KPIs for each portfolio company, to
focus the effort on what really matters.
To best leverage reporting, it is critical to ensure that
data is used. Many entrepreneurs report not knowing
how to leverage the required indicators, such as those
derived from carbon footprint assessments. To address
this issue, it is critical to offer guidance and support
companies in their transition towards sustainable prac-
tices. VC funds are playing a more active role in this re-
gard: almost 75% of respondents indicated providing
support to their portfolio companies in that field. → M
One of the key types of support offered is guidance in
creating climate roadmaps, which can be tailored based
on previously conducted Due Diligence. In many cases,
the first action is conducting a carbon footprint assess-
ment. It can also be used to infuse best practices, such
as defining an owner within the organization. Clearly
defining who is the owner is a crucial component to
structure the approach. → N
Some funds develop knowledgeable teams internally, or
recourse to operating partners, but for larger funds with
multiples portfolio companies, this model can show its
limits. Other funds develop a network of partner they
can leverage (carbon footprint measure companies, etc.)
and recommend to their participations. Some funds cre-
ate alternative models. At XAnge, a startup success team
has been set up, composed of 4 people in charge of
bringing assistance to portfolio companies and all and
any matter, including sustainability.

“Rather than committing to signing multiple
charters, it is important to focus efforts on
achieving a smaller number of goals with
greater impact. Alven has set targets in two
priority areas: gender diversity (increasing
investments with at least one woman among
the founders and increasing the number of
women on management committees) and
decarbonization (increasing the number of
portfolio companies with over 30 employees
measuring and offsetting their carbon
footprint).”
Guillaume Aubin, Co-founder & Managing Partner, Alven
SETTING
REALISTIC TARGETS
Alven
M | Do you provide support to portfolio companies
regarding their climate impact?
Yes
75.3%
No
26.5%
N | Of which kind?
Guidance/support in structuration
of climate-issues monitoring 80%
Financing of carbon footprint assessment 28%
Sourcing of ESG/Climate profile
Financing of climate transition plan
20%
8%
Other 0%
“Even at early stage, it is important to define an
owner (e.g. CFO, Chief of Staff) to champion
these ESG topics, and then appoint a designated
person (e.g. Chief Sustainability Officer) as soon
as the size of the team allows it.”
Xavier Lorphelin, Managing Partner, Serena
DEFINING AN OWNER
Serena

O | What measures has your organization taken
internally to tackle the issue of climate change?
Measure carbon footprint 76.5%
Adapt company policies to reduce carbon footprint
(transportation policy, office management, etc.) 79.4%
67.6%
Train employees on climate-related issues
(e.g. Climate Fresk, etc.)
Support climate-related association/NGO/organizations 52.9%
None 2.9%
Other 8.8%
3.3 LEADING BY EXAMPLE
Encouraging startups to consider the pressing issue of
climatechangeholdstruevalue,onlyifassetmanagement
firms themselves follow the same guidance they offer.
Measuring carbon footprint is typically the first step on
this journey. Expected to become a market standard, this
measurement helps identify practical steps to reduce
carbon emissions. 80% of respondents declare they
already completed this process. Undertaking this
measurement also allows for better support of portfolio
companies in their own measurement efforts. → O
“To make real progress on these issues, it’s
critical to seek guidance from experts. At AVP,
setting up an advisory committee to notably
help us on environmental and climate issues
was a real game-changer. This committee of
experts (among which Brune Poirson, former
French Secretary of State for Ecological and
Solidary Transition) has helped AVP prioritize
actions, get rid of self-doubt, and set
measurable goals. Their support is also
available to portfolio companies, allowing a
sharing of best practices. Every year, the AVP
Days gather with LPs, entrepreneurs, and
advisors for two days to exchange ideas on
these topics.”
Benoit Fosseprez, General Partner, Axa Ventures Partners
SURROUNDING YOURSELF
WITH EXPERTS
Axa Ventures Partners
As with portfolio companies, it is essential to designate
an owner or a responsible person within management
companies. Increasingly, funds are equipping and struc-
turing themselves. As the VC model is historically and
structurally based on lean teams, the movement to re-
cruit dedicated personnel is not negligible. “All Parisian
VCs are equipping themselves with dedicated teams, which
is quite innovative in a profession with historically strictly
monitored cost structures,” says G. Pontoizeau from
Korelya Capital. For many funds that do not have envi-
ronmental expertise, this also means recruiting or con-
sulting with experts. → P

Ultimately, to truly commit to the cause of climate, it is
essential to align retribution with environmental tar-
gets. Several funds already index part of their carried
interest to the reach of environmental targets. Up to
50% of carried interest for the most exemplary funds
can thus be linked to extra-financial reporting, demon-
strating real commitment from those VCs to making a
difference in the battle against climate change. → Q
“Ultimately, the only true referee against
greenwashing is to set clear and quantifiable
objectives, measure your impact and engage
your compensation. For example, we condition
50% of our carried interest to the reach of
impact business plan. This holds investment
teams accountable.”
Nicolas Celier, Managing Partner, Ring Capital
ALIGNING INTERESTS
TO PUT IMPACT AT THE CORE
Ring Capital
P | Do you have a person within your teams
dedicated to ESG/Climate-related issues
(Chief Sustainability Officer, etc.)?
Yes
58.8%
No
41.2%
Q | Do you have any mechanisms to align your
objectives with those of the executives of the
participation companies in the fight against
climate change?
Yes
67.6%
No
20.6%
Doesn’t know
11.8%

4
WHAT’S
NEXT?
Towards tomorrow’s Venture Capital

4.1 UPSKILLING THE ECOSYSTEM
So, what is required to take the tech ecosystem to the
next level? The first answer is education. Exchanges
with VC funds depict a lack of knowledge and under-
standing of climate-related issues among the tech eco-
system, notably in the startup sphere. → R
Indeed, effective action on climate change requires a sig-
nificant investment in learning. To take meaningful steps
towards mitigating the effects of climate change, it is im-
portant to have a deep understanding of the phenome-
non itself, as well as the intricacies of carbon accounting.
This knowledge is particularly crucial for companies, as
they have a substantial impact on environment.
R | What are the factors limiting the integration
of climate-related criteria in VCs investment
activity? (with multiple choice)
Lack of available frameworks/criteria to measure
climate-related impact 55.9%
Low maturity of target/portfolio companies 70.6%
52.9%
Fear of negative impact on returns
29.4%
Lack of awareness from VC fund managers
Lack of high potential climate-tech startups 38.2%
Difficulty to change investment processes 23.5%
Lack of pressure from LPs 35.3%
Other 11.8%
Lack of qualified staff 35.3%
Lack of understanding of some “impact business models”
(biotech, deep-tech, hardware...)
Comparative ease to frame the investment vs. traditional b2b SaaS
“At EQT Ventures, we are well organized
to conduct in-depth research on specific topics
and form opinions on the most promising
technologies in the area. We identify specific
issues that we believe will become critical in
the coming years, gather input from key
opinion leaders in the field, and increase our
knowledge base. For example, by conducting
research on the topic of battery shortage in
Europe, or battery recycling, we identified the
potential of EV batteries with Verkor
or the potential of hydrometallurgy.”
Rania Belkahia, Partner, EQT Ventures
DEEP-DIVING ON
TOMORROW’S KEY ISSUES
EQT Ventures

For VC funds, this means being able to understand in-
novative business models, linked to biotech or Deep-
Tech for example. To achieve this, all stakeholders have
the responsibility to increase their knowledge and edu-
cate others, from VC funds to startups and intermediary
bodies (FranceDigitale, Franceinvest).
4.2 CREATING REPORTING STANDARDS
One of the main pain points regarding climate commit-
ment for the tech ecosystem is the weight of reporting.
Reporting is one of the main steps regarding climate
commitment for the tech ecosystem. Startup reporting
requirements have caused some concern among VC
partners due to their excessive and somewhat dispro-
portionate nature. As VC generally take minority stakes,
“The investment in cleantech has significantly
increased in recent years. To accelerate this
trend, we need a shift in the general mindset,
which means investing time to increase
knowledge of the physical reality.
For instance, we need to collectively improve
our understanding of what a full CO2
cycle
emission reduction means. This will enable us
to invest in solutions that contribute to
drastically decrease our physical
environmental impact.”
Vincent Brillaut, Managing Director, ALIAD
FOSTERING ENVIRONMENTAL
UNDERSTANDING
ALIAD
“ESGReportingiscriticalbutiscurrentlycomplex
andtimeconsuming,especiallyforportfolio
companies.Mostquestionnairesarenotharmo-
nizedexceptforafewLPsalignedwithBpi-
france’sframeworksinFranceforexample.This
canbecounterproductive.Althoughregulationis
movingintherightdirection,definingbroader
marketstandardswouldhelpgaininefficiency
andmakereportingbecomeanactionabletool
thatcompaniesandinvestorscaneasilytranslate
intoconcretemeasures.Wealsolookforwardto
moreLPs/GPscollaborationregardingESG
actionplansandstrategies.That’sthenextarea
whereweshouldshareknowledgeandresources
tohavemoreimpact.”
Grégoire Pontoizeau, Principal, head of ESG, Korelya
TURNING REPORTING
INTO AN ACTIONABLE TOOL
Korelya
startups end up reporting to multiple investors, each
with their own templates. The multiplicity of question-
naires and KPIs can quickly create an administrative
burden, particularly for young companies.
This issue extends beyond the VC-startup relationship,
as VCs themselves report to their Limited Partners. The
result is a complex web of different reporting demands,
which can ultimately be counterproductive for all par-
ties involved.

ecosystem of companies is developing around non-fi-
nancial reporting, with the objective of assisting compa-
nies in this regard. The proliferation of offers does not
help with clarity but demonstrates the dynamism of the
ecosystem on these issues.
Despite the significant challenge, there are reasons to be
optimistic. We witness an increasing awareness of the
issue, and industry players have demonstrated a clear
willingness to work towards more common standards.
Furthermore, we are starting to see signs of convergence,
with some LPs and VCs choosing to adopt the frame-
works established by Bpifrance/Franceinvest. Addition-
ally, the French ecosystem is set to benefit from the ini-
tiatives of industry players such as France Digitale, which
recently established a taskforce made up of VCs and
startups, aimed at defining common standards.
In the era of digitization, the process of simplification
will also be facilitated by innovative tools. Funds are
calling for the development of digital platforms that
would enable entrepreneurs to submit their data and
allow their various stakeholders to access it. In fact, an
“The industry has room for progress, especially
when it comes to reporting tools. While there is
a plethora of digital solutions available, it can
be challenging for funds to select the right one.
The ecosystem is not yet fully developed, and
no provider has emerged as
a market leader.”
Raphael Didier, Director of Transformation & Strategy,
Bpifrance
DEVELOPING REFERENCE TOOLS
Bpifrance
“We have launched a task force aimed at
developing an extra-financial grid that is
tailored to the tech ecosystem. Our goal is to
establish market standards and unify
definitions, so that all players speak the same
language and share common criteria. We are
witnessing a growing momentum around this
issue, with strong interest from VCs and a high
level of expectation for this grid. It is eagerly
awaited!”
Maya Noel, Director, France Digitale
BUILDING INDUSTRY STANDARDS
France Digitale
Indeed, the ecosystem is witnessing the beginning of what
will likely become extra-financial reporting standards,
that will potentially be as structured as financial reporting.
Just as the IFRS standards took time to define and estab-
lish themselves, these extra-financial reporting standards
will take time to develop. Although extra-financial data is
not subject to auditing, it is imperative for companies to
prepare for its eventual auditability in the future.
4.3 INVENTING NEW FUNDING MODELS
Going further, the industry might come to see even
more structuring changes in order to face up to the chal-
lenge of climate change.

To counter these defects of the current VC model, some
funds have started to imagine new models, tailored to
address the new generation of tech, with larger invest-
ment required and longer R&D development phases.
Regarding timing, evergreen funds propose an alterna-
tive to close-end funds, setting no closing date and al-
lowing investors to come and go.
To deploy the large capital required by some R&D invest-
ments, interrogated VC funds offer a large set of answers.
For some, future financing will be distributing financ-
ing, involving multiple players. Others think that Corpo-
rate Venture Capital will be instrumental, backed by
large corporations used to heavy development cycles.
For a few, large international PE or infra players could
develop their Venture Capital activity and offer the re-
quired firepower.
Indeed, the VC mode, as we know it, has some con-
straints. Firstly, the 5-10 year closed-end fund model is
not suitable for longer-term investments strategies re-
quired to develop sustainable solutions. Breakthrough
innovations in fields such as clean energy, carbon neutral
materials require significant research and development
efforts, with extended proof of concept phases. Further-
more, the current system based on rounds can provoke a
lack of alignment among investors, with varying owner-
ship periods, leading to divergent goals and priorities.
Secondly, VC funds focus on the financial performance
of the fund, which is predominantly measured by finan-
cial criteria. Even if extra-financial criteria are set in the
investment process, the performance itself is almost
only considered from a financial point of view, based on
rates of return. Finally, VC funds minimize their risk by
replicating what has worked in the past. By design, they
are used to repeat past successes.
“Today, the industry is at the stage
of transparency. The next step is the auditing
of this data, which is the only real way to
avoid greenwashing. Just as the IFRS
accounting, standards for measuring and
reporting on climate and carbon are expected
to develop. This takes time, but like the audit
of financial data, environmental audits
are gaining momentum.”
Stéphanie Chrétien, Partner, Demeter
FROM TRANSPARENCY
TO AUDITABLE DATA
Demeter
“2050 wanted to cope with the sustainable
innovation cycle which is longer than the one
that traditional VC funds deal with. By being
evergreen, we offer no time limit on the life of
investments. We invest at various stages to
mitigate risks for our LPs and build a long
term relationship with the entrepreneurs we
back and help grow with a specific alignment
methodology.”
Guillaume Bregeras, Managing Director, 2050
REINVENTING VC TO MEET
THE CLIMATE CHALLENGE
2050

The tech ecosystem as a whole, from founders to investors, is increasingly
acknowledging the urgency of the climate crisis. The pace of change is
rapidly gaining traction, as companies of all sizes prioritize environmentally
responsible actions and reduce their impact on the planet. This seismic shift
is being driven not only by the growing sense of corporate accountability,
but also by regulatory pressure and the demands of a more environmentally
conscious consumer base. As a result, we are witnessing a growing
appetite from investors, a proliferation of sustainability-oriented startups,
and a multiplication of initiatives from VC funds to integrate climate into
their investment processes.
However, despite the considerable progress that has been made, a great
deal remains to be accomplished. The role of venture capital (VC) funds
in this context cannot be overstated. As the link between capital and
entrepreneurs, as well as the primary source of funding for many startups
and scale-ups, VC funds have a unique opportunity to foster change and
support the development of sustainable technologies and business models.
By focusing on startups that prioritize sustainability, supplying resources
and assistance to help them scale, and collaborating with other
stakeholders to advance sustainable innovation, VC funds can be powerful
drivers of change in the fight against climate change.
CONCLUSION

2. WEBSURVEY
Online survey conducted in March and April 2023 with a
representative database of French and European Venture
Capital and Corporate Venture Capital funds, representing a
total of EUR 92 bn assets under management and investing
from Seed to Growth assets.
RESPONDENTS PROFILE
METHODOLOGY
To obtain a comprehensive overview of VC funds’ response
to the climate crisis, this study relied on quantitative and
qualitative sources:
1. QUALITATIVE INTERVIEWS
24 Qualitative interviews with VC fund partners or industry
players
What would best describe your organization?
Globally
At what stages do you invest?
In France
VC pure
player
70.6%
Corporate
Venture
Capital
23.5%
PE/infra/generalist fund
with VC activity
5.9%
11-50
47.1%
1-10
26.5%
51-100
11.8%
100-500
8.8%
1000+
5.9%
1-10
50%
11-50
32.4%
0
5.9%
1000+
5.9%
100-500
2.9%
51-100
2.9%
Early stage (Series A-B) 79.4%
Seed 47.1%
Growth (Series C and beyond) 26.5%

Nicolas Teisseyre
Senior Partner
nicolas.teisseyre@rolandberger.com
Juliette Adant
Consultant
juliette.adant@rolandberger.com
Mathieu Michelin
Content Manager
mathieu.michelin@rolandberger.com
AUTHORS
ROLAND BERGER
Sébastien Murbach
Senior Partner
sebastien.murbach@rolandberger.com
Anne Corteggiano
Head of External Affairs and Engagement
anne.corteggiano@rolandberger.com
Claire Pernet
Partner
claire.pernet@rolandberger.com
Yaroslav Stetsenko
Partner
yaroslav.stetsenko@rolandberger.com
STATION F
Startups & Investment Team
investors@stationf.co
We welcome your questions, comments and suggestions
www.rolandberger.com
This publication has been prepared for general guidance only. The reader should not act according to any
information provided in this publication without receiving specific professional advice. Roland Berger GmbH
shall not be liable for any damages resulting from any use of the information contained in the publication.
© 2023 ROLAND BERGER GMBH. ALL RIGHTS RESERVED.
May 2023
PRESS CONTACT
Roland Berger Press Team
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