Anric Blatt Sustainability as an asset class

ANRIC BLATT

ChairmanGOBAL FUND EXCHANGE GROUP

PartnerTERRA PRIMA PARTNERS LLC

Sustainability as an Asset Class

FOOD, WATER & ENERGYAND WHY IT’S A MUST

“Treat the Earth well. It was not given to you by your parents.

It was loaned to you by your children.”

“Treat the Earth well. It was not given to you by your parents.

It was loaned to you by your children.”

7 BILLION AND CLIMBING

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30% of the world's arable land will be unusable by 2020

50% may be unusable by 2050

with dire consequences for investors, consumers and governments.

Namib Desert, Namibia 2007

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0

2

5

7

9

19501987

Today2040

Population in BillionsArable Land in hectares / person

Population growth & arable land

0

175

350

525

700

1970 1980 1990 2000 2010 2020 2030 2040 2050

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POPULATIONAVERAGE CALORIES PER PERSONFEED GRAIN NEEDED - All Indexed back to 100 in 1970

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0

175

350

525

700

1970 1980 1990 2000 2010 2020 2030 2040 2050

POPULATIONAVERAGE CALORIES PER PERSONFEED GRAIN NEEDED - All Indexed back to 100 in 1970

0

175

350

525

700

1970 1980 1990 2000 2010 2020 2030 2040 2050

POPULATIONAVERAGE CALORIES PER PERSONFEED GRAIN NEEDED - All Indexed back to 100 in 1970

“It takes 1,000 tons of water to make 1 ton of grain and 7 tons of grain to produce 1 ton of beef.

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“If we unbalance nature, mankind will suffer. We must consider future generations: a clean environment is a human right like any other. It is therefore part of our responsibility toward others to ensure that the world we pass on is as healthy as, if not healthier than, we found it.

“go long agriculture and water and go to the beach ......

... put those investments in the bottom drawer for 10 years.

Agriculture and water would even beat energy investments”

Invest in agriculture and water, says BlackRock CEO Larry Fink

we are extracting fresh water at

rates up 100 x the natural

replenishment rate.

To avoid political turmoil and regime changes, governments

have no choice but to continue investing in

food, water and energy infrastructure

THE CALM BEFORE THE STORM

Sir David King, Chief Scientific Adviser UK Government

“The global battle for natural resources – from food and water to energy and precious metals – is only beginning, and will intensify to proportions that could mean enormous upheavals for every country.”

If we unbalance nature mankind will suffer.

Today with over 2 Billion people who are malnourished, we must address a crisis unfolding.

The facts are undeniable and the outcome subject to the actions taken by you and me today.

100,000 people die every day of starvation.

The world's geopolitics will be shaped by the global race for four strategic resources: food, water, energy & metals

10,000 species have gone extinct in just the past 100 years

if bee populations fall too far, our food supplies will be seriously threatened . . .

Over 70% of our food is pollinated by bees . . . .

5.9 Million (1947)

2.62 Million (2012)

1.8 Million (2013)

4.5 Million (1980)

This crisis for mankind and our planet is simultaneously our greatest challenge, as well as a once in a lifetime investment opportunity for visionary investors.

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by 2025 the agricultural sector will experience serious water shortages. Crop losses due to water scarcity could be as high as 350 million metric tons per year, slightly more than the entire crop yield of the U.S.

International Food Policy Research Institute (IFPRI)

Leave a Legacy that you would like to inherit

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WHAT IF

WHAT IF WE, DO NOTHING ?

WHAT, IF ?

29WHAT IF WE CONTINUE DIGGING ?

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WHAT IF WE KEEP BURNING?

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Amazon Deforestation 2012. Since President Dilma Rousseff took office in Jan. 2011, she has reversed deforestation laws

WHAT IF WE KEEP CUTTING?

DOWN OUR FORESTS

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Amazon Deforestation 2012. Since President Dilma Rousseff took office in Jan. 2011, she has reversed deforestation laws

WHAT IF WE KEEP CUTTING?

WHEN WILL IT STOP ?

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KEEP DISCARDING ?

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WITHOUT CONSEQUENCES

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Wondering why our children are sick ?Kansas, July 2nd, 2007

WHAT IF WE, CONTINUE POLLUTING ?

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Fire at the Chevron oil refinery in Richmond, California, August 6, 2012

WHY DO WE KEEP BURNING?

enough solar energy hits the earth in one single hour

WHEN

to power the entire globe for a full year.

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A view of an illegal oil refinery is seen along a creek outside the oil hub city Port Harcourt in Nigeria's Delta region.

WHAT IF WE KEEP LOOKING THE OTHER WAY?

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In a world where, over 1.4 billion people – 20% of the

world’s population . . .

That’s 20% of the world’s population

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. . . live in areas where the limits of sustainable water use have already been

reached or breached.

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n o k i d h u n g r y . o r g

when already

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Deepwater Horizon, Gulf of Mexico

WHEN EVERY YEAR WE KILL MORE

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Yangtze River, Sept 2012

Dinner, Seriously ?

WHEN THIS SEEMS NORMAL ?

441 billion people lack enough water to simply meet their basic needs. World Health Organization

WHEN ALREADY 80 COUNTRIES HAVE

WATER SHORTAGES

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46

ARE WE GOING

TO

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WHEN

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DRINKING THE COOL AID

ARE WE GOING TO KEEP

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“Slow down”Panama, Sept 2012

WHAT IF WE HAVENT EVEN

SEEN THE EFFECTS OF CLIMATE CHANGE

51. . . . JUST THE BEGINNING

WHAT IF THIS IS ...

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what if these are your kids ?

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Rio de Janeiro

AND THIS IS . . . .

... THEIR DINNER TONIGHT

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Bangladesh Garbage dump or playground ?

AND THIS IS . . . .

... THEIR BIRTHDAY PARTY

55FOOD, WATER & ENERGY

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AND THIS IS . . . .

... OUR LEGACY ?

OR ARE YOU GOING TO TAKE ACTION ?

WATER OFF A DUCK’S BACK ?

OR ARE YOU GOING TO TAKE ACTION ?

WATER OFF A DUCK’S BACK ?

- amidst these challenges

WE MUST FIND THE PROFIT OPPORTUNITIES

OBSTACLE = OPPORTUNITY

OBSTACLE

OPPORTUNITY

PROFIT

GO

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IS THIS . . .

. . . OR THE BEGINNING

GLOBAL FUND EXCHANGE . COM

NEW YORK + 1 212 570 7970 HONG KONG +852 8174 6688

TERRA PRIMA PARTNERS . COM

AND NOW, BACK TO MAKING MONEY

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Global energy demand to increase 50% by 2030

Weather & climate anomalies

Population growth of80 million people/year

Significant infrastructure underinvestment since 2008

Significant stress on global food supply

Rapid industrialization & urbanization of emerging markets

Severe water stress & major increases in water demand

China, India & developing world natural resource consumption

Peak Oil vs. Peak Cheap Oil

China’s race to super power needs Energy, Water, Agri & Resources

WHY ? BECAUSE THEY ARE MUST OUTCOMESGlobal shift towards lower carbon

energy & CO2 use

Population and income growth – the two most powerful forces behind rising

global demand for energy, water and natural resources.

Weather & climate anomalies

Population growth of80 million people/year

Significant infrastructure underinvestment since 2008

Significant stress on global food supply

Rapid industrialization & urbanization of emerging markets

Severe water stress & major increases in water demand

China, India & developing world natural resource consumption

Global energy demand to increase 50% by 2030

Peak Oil vs. Peak Cheap Oil

Population and income growth – the two most powerful forces behind rising global demand for energy, water and natural resources.

China’s race to super power needs Energy, Water, Agri & Resources

WHY ? BECAUSE THEY ARE MUST OUTCOMES

Investments in Water

Investments in Energy

Investments in

Agriculture

Clean Energy Investments

Global shift towards lower carbon energy & CO2 use

Natural Resource &

Commodities

MARKET DRIVERS

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ENERGY SUPPLY SHIFT

ENERGY PRICE VOLATILITY

WATER SCARCITY

BUILDING / LIGHT EFFICIENCY

GRID UPGRADES

NEW TRANSPORT SOLUTIONS

DECLINING ARABLE LAND CONSUMER

Evolving economics driving a shift toward renewables, natural gas, nuclear, and away from coal and oil. Shale gas is changing the energy landscape.

Organic and efficient products experiencing secular growth. Consumer driven demand for smart technology taking off

Massive capital spending required to upgrade aging transmission and distribution infrastructure to a smart grid.

Energy cost volatility, regulatory changes and cost savings initiatives driving investment.

Electric and natural gas vehicles approaching mainstream adoption. THANK YOU ELON

As per capita incomes rise, expanding protein consumption puts the pressure on agriculture yield, this drives technology and investment.

Supply challenges complicated by accelerating water demand and increasing concerns with water quality. Climate change is hitting home

Security concerns and the recognition of a need for more diversified sourcing, as well as a perception of “peak oil” leads to supply constraints.

TERRA PRIMA PARTNERS . COM

WAYS TO INVEST WITH IMPACT

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EQUITY FUNDS

SECTOR FOCUSED FUNDS

REAL ASET FUNDS

COMMODITY FUNDS

OTHER

Public Long OnlyMutual FundsETF’sPublic HedgePrivate EquityVenture Capital

HybridsBondsCredit Funds

Ag LandTimberClean (er) EnergyWater rights & entitlementsNatural resourcesGreen infrastructureGreen Buildings Property REITS

AgricultureEnergyMLPGasClean (er) EnergySolarWindWaterNatural resourcesImpact Assets

TERRA PRIMA PARTNERS . COM

Systematic (CTA)Energy Relative ValueMetals

AGRICULTURE - THE VALUE CHAIN

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WATER

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THE SHALE GAS OPPORTUNITY

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CLEAN ENERGY OPPORTUNITY - SOLAR

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CLEAN ENERGY - WIND

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CLEAN ENERGY - EFFICIENCY - LED LIGHTING

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SUSTAINABILITY AS AN ASSET CLASS

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ENORMOUS UNIVERSE

RESEARCH - NOW MORE THAN EVER

PORTFOLIO CONSTRUCTION

CONSTANT INNOVATIONS

ECONOMIES OF SCALE

GEOPLITICAL FACTORS

RISK MANAGEMENT EXIT STRATEGY

25+ Different Asset ClassesHundreds of sub-sectorsGeographic variances

Knowing when to exit and reinvest is critical. Kick the buy high - sell low habit.

Diversification amongst multiple geographies, asset classes and managers takes deep pockets

New technology coming to market daily, need to remain flexible

Fed Monetary PolicyRegulation & PolicySubsidies

Full time attention to changing conditions, profit taking and portfolio rebalancing

Combining different asset classes to reduce risk, reduce volatility and improve returns

QualitativeQuantitativeForensic

OR JUST GIVE IT TO THIS GUY

74HE’LL DO SOMETHING GOOD WITH IT

THANK YOU TO PETER FUSARO

O P P O R T U N I T Y

ANRIC BLATT

+1 212 888 71 57AB @ TERRA PRIMA PARTNERS . COM

Do not follow where the path may leadgo instead where there is no pathAND CAREFULLY LEAVE A TRAIL