CIO, Where Have You Been?!(2)
[CIO on the Road] Kyungsun's Imagination
At Root Impact we have a CIO, different from a CEO, CFO or CMO. This instantaneously gets many wondering; what does that "I" in the middle stand for? Is it information? Investment? Innovation? Oops, out of guesses. The correct answer is IMAGINATION. The CIO of Root Impact is the Chief Imagination Officer, who ponders on ideas and issues that have not yet surfaced, which makes the CIO quite invisible to us maybe. The Root Impact family and friends must have been very curious about his past six months as we couldn’t catch much glimpse of him, so this article over two issues will cover what CIO Kyungsun Chung was up to in those months. Eager to learn how he traveled all across the globe to Bangkok, Singapore, the U.S. and other places with a core focus on expanding changemaker communities? Dive right in!
1. Time is Ticking – Prepare a Blueprint for the World in Crisis
Q. (Continued) So would it be correct to assume that you are traveling all across the globe to find a solution to tackle climate change? I also found it appalling how Korean news outlets covered so little on the Amazon wildfire crisis.
Let me refer to a report and two articles. According to a report by the Intergovernmental Panel on Climate Change, or the IPCC, ice loss from Antarctica's ice sheet tripled from 2007 to 2016, relative to 1997-2006. Furthermore, while I’m repeating myself, the earth's temperature rose 1 degree Celsius since industrialization due to human activities, and is expected to add on an extra 1.5 degrees from 2030 to 2052. Densely populated regions will see an even steeper rise in temperature; some regions will suffer from downpours, while others from droughts and deforestation. Declining biodiversity, extinction of species will be only some of the critical impacts on our ecosystem. Climate change therefore imposes an overall risk on healthcare, sustenance, food security and water supply, just to name a few.
Also, according to an article on New York Times, 150 million people around the globe will be living in regions that submerge at high tide by 2050. More specifically, most of Southern Vietnam is destined to be underwater, while 10% of the entire population of Thailand are currently residing in regions that are expected to drown in 2050. The number used to stand at 1%, but now has grown to a whopping 10%. Bangkok, especially, is a region of high risk.
How does it sound? Climate change is not just an environmental issue. It is a challenge to the entire human race, and is intricately linked to our safety and defense. What requires our immediate attention is that Southeast Asian countries, in particular, are not carrying out any concrete preparations. They are living in the most risky regions but are standing off guard as this greatest threat fast approaches them. Just 30 years! I think this was something we first had to raise awareness about.
Q. You mentioned that you're fundraising the Global Impact Fund. In an interview when we published the book <Are you a Changemaker?>, you shined a limelight on the role and mission of chaebols in your interview. Is the Global Impact Fund in line with what you said then?
Yes, while I am in many ways related to insurance company, players that cover most of the cost incurred from climate change, social unrest rising from inequality, aging society and rising healthcare costs are in fact the insurance companies and the governments. Insurers overseas have long been heavily investing in preventive healthcare. They are institutions most fit to engage in impact investing, but me on my own was not enough to pull together a fund of a size that could really tackle this immense threat. That is why I contacted governments carrying about similar projects and talked to many insurers in the Southeast Asian region into working together. As a result, we will be launching a large sized impact investment fund in Singapore within the first half of 2020. (clap clap clap!) The fund created is named The Sylvan Group. I hope you see this project as a way to diversify means of investment and to direct capital inflow into social impact (refer to Root Impact bi-weekly newsletter, Magazine Root Impact #59). With this I believe there could be more capital pulled into various different types of impact investment.
We will be launching a large sized impact investment fund in Singapore within the first half of 2020. The fund is named The Sylvan Group. I hope you see this project as a way to diversify means of investment and to direct capital inflow into social impact.
Let me give you an example. The Sylvan Group will invest in tech that are in their series B or C rounds of funding. On top of that, what if the Singaporean and Indonesian governments understand the magnitude of the issue of sea level rising in Southeast Asian waters and decide to issue social impact bonds to tackle climate change? As such, we will categorize different vehicles of investment as well as social issues to provide an array of options that provide tailored solutions. My blueprint is to incessantly provide these tailored impact capital for various stages of investment. I think it is my mission to keep knocking on the doors of governments and companies, or whoever we need, to pull together capital to this very end.
It's encouraging that Goldman Sachs has also pledged to invest $750 billion to environmental causes by 2030. This showcases that impact capital on various levels are being pulled together to tackle climate change, or the aftermaths of climate change. The Goldman Sachs CEO said that companies no longer have the “luxury” of treating climate-related initiatives as a “peripheral issue,” and that financial institutions must support those driving change. He is also in favor of carbon tax, and argues that combining public policy, technology and capital is a must, not a choice. This fund will make investments in nine core climate-change-themes as well as in finance that aims for inclusive growth (access to education and food production, etc.); and tighten standards on loans to oil-related industries. Also, the fund will invest to help companies in the mining industry to cut down on carbon emissions and to diversify their business portfolios. The CEO also pledged never to invest in projects that "directly support oil drilling or power generation in the Arctic."
2. Find the Impact Unicorn!
Q. So you shared with us the direness of the situation of climate change as well as issues deriving from it. It sounds like the global impact fund is an attempt to tackle these issues. If you're investing in series B or C rounds, investment must be sizeable; what are your investment strategies?
This fund will launch in Singapore in the first half of 2020. I became acutely aware of the direness of the climate change situation while studying at the Columbia Business School, and I needed to come up with a way in which I can bring about change ASAP. The Impact fund is going to be of considerable size and I am currently in the process of ironing out the details with major stakeholders.
This fund focuses its investment on five to six themes: Affordable Healthcare, which allows people access to healthcare at an affordable price; Smart/Green City for urban environment; Innovative Education that nurtures talent to create such changes; Inclusive Finance, which leaves no one marginalized from financial access; and Climate Resilience, where steps are taken to respond to climate change. I am also planning to add Diversity & Equality as another theme but not sure if we can find the right companies in Asia under the theme, relative to those in the U.S. or Europe, which remains a question and something we have to work on.
Location of the company is not an issue, but ultimately I would like to invest in companies that exist to bring about an impact in Asia. For instance, say we invest in an Innovative Education company located in Israel. Ultimately, I want this company to expand its business into Southeast Asia to bring about an impact eventually in Asia.
I am expecting most of the investment to be poured into tech-based impact companies, and looking forward to discovering a unicorn, an impact unicorn. That way we can tackle this imminent challenge ASAP.
3. Without the Changemaker Ecosystems in Hub Cities, There Exists No Blueprint
Q. Then how does this large sized investment in tech-based startups relate to the changemaker ecosystem created by Root Impact?
Well if the IPCC report or the NYT article didn't get to you, think of it this way. When a city is underwater for just two weeks in a year, it's not livable. Think of all the people in New York still suffering from the damages and trauma of Hurricane Sandy that hit back in 2012. Even when we cannot stop global warming from happening, the least we can do is to prepare for the sea level rise. The fact that Bangkok hasn't even attempted to compute the sea level rise despite it being the political and social capital of Thailand is depressing.
The changemaker ecosystem and the global impact fund are mutually complementary. Prior to investing ample resources, an ecosystem that could run those resources needs to be up and running. The correlation between capital (in my view) and an ecosystem may not be firm but the direction they both are headed is similar.
Changemakers are having a party at the HEYGROUND Seongsu (1st Heyground in Seoul, Korea)All these efforts are exerted by, and needs to be exerted by, companies and individuals that are within the changemaker ecosystem. That is why we need an even more vibrant changemaker ecosystem. It is a prerequisite. For this we will need ample resources, and prior to that we need an ecosystem up and running that could actually make use of those resources. We are using a two-pronged approach here since on one side we need investment from those that deeply identify with the challenge of our time, while on the other side we need people who can come up with solutions that fully utilize those resources.
Once again, the changemaker ecosystem and the global impact fund are mutually complementary. That's why we all need to put our heads together. Sometimes region A and B work on the same issue in silos, unaware of the redundancy. Only when there are actively knowledge sharing, can we remove such redundancies and speed up the process. The correlation between capital (in my view) and an ecosystem may not be firm but the direction they both are headed is similar. Focusing on making the ecosystem vibrant, for instance by creating more HEYGROUNDS in hub cities, also requires capital; and what we learned from HEYGROUND Seongsu (above photo) is that a physical hub serves as the centripetal force for the changemaker community.
4. Anywhere with HEYGROUND and I am Gilsoon*!
(*Gilsoon is the name of the homeless cat who found HEYGROUND as her first home and is loved by all the changemakers in the first HEYGROUND Seoul)
Q. After you got to meet former President Obama in Singapore, I heard that people from the Obama Foundation visited HEYGROUND on Dec. 20, 2019! Could you share with us what you discussed with them?
Definitely. The Manager of Asia-Pacific Programming at the Obama Foundation visited us, and we discussed the possibility of supporting one another’s work. I would love to work together to support changemakers, whether in New York, Seoul, Bangkok or Singapore. The Obama Foundation was established after President Obama's presidency commenced. Internationally, the Foundation currently runs the Obama Scholars program at Columbia University and the University of Chicago, the Obama Leaders program in the Asia Pacific and Africa, and the Obama Fellows program. Additionally, the Foundation has numerous US-based national programs that carry out an array of community-based activities as well. The Obama Presidential Center is currently under construction in the South Side of Chicago, where both President Obama and Michelle Obama spent a significant part of their lives.
I am hoping that the participants of the Obama Foundation’s programs become part of our changemaker ecosystem. The type of people they attract in their programs are changemakers that we, too, would love to be able to know and support -- emerging leaders who take on local social issues and find solutions!
One exciting thing that came out of our conversation was that I was asked to speak at a virtual speaker series the Obama Foundation Leaders: Asia-Pacific program will be hosting throughout 2020. But beyond speaking engagements, my hope is that we can someday host Foundation's events at HEYGROUND, maybe jointly with Root Impact. They were very interested in changemaker hubs that we're creating across the region, and we will continue to find ways in which we can work together.
One exciting thing was that ... I was asked to speak at a virtual speaker series the Obama Foundation Leaders: Asia-Pacific program will be hosting throughout 2020.
Q. Former President Obama… going global… I have a feeling you're becoming bigger and bigger and that we won't be able to catch you around much in Korea!
Looking at it from a global perspective, I think Korea is especially interesting when it comes to the impact ecosystem, as the small country presents various different groups in a nutshell. In one sense I think Korea is a futuristic country. Social issues and the process of tackling such issues can be seen clearly and quickly, whether the issue be positive or negative. Also since I was born and raised in Korea, so I have much resources at my disposal here in Korea. That is why I believe the changemaker and impact ecosystem created and led by Root Impact, Korea should serve as the test bed for the for the entire global community, and that the takeaways from Korea should be shared among other countries. Korea, I guess, is like the spine of the ecosystem.
In the front yard of HEYGROUND Seongsu, you can find the beloved cat Gilsoon. I hope I can be like her. I mean, there isn't a specifically designated space for Gilsoon at HEYGROUND, but everyone finds Gilsoon a legitimate member of the changemaker community. If the changemaker ecosystem like HEYGROUND expands to all corners of the globe, changemakers all over the world, including myself, can create local communities where people can work to make their beloved place a better one. I think such communities, regardless of the location, can become true "homes" where it's only natural for changemakers to seek solutions to challenges.
I might not be around much in Korea, but please think of it this way: "Oh, he must be somewhere in the world completing his blueprint for changemakers!"
Few Last Words
Did you know that bees flap their wings 200 times each second to collect honey? Having a talk with CIO Kyungsun Chung who flew 300 hours over the last six months reminded me of those hardworking bees. He used to bring honey to the honeycomb called Root Impact to spur growth of the social venture valley; now he's incessantly flapping his wings to launch the impact fund with a focus on global hub cities while expanding the changemaker ecosystem. Even at this very moment, changemakers across the globe are sparing no effort to tackle various social issues in their own innovative ways. I sweetly dream a day will come when Root Impact, Communitas America and HEYGROUND become home to those changemakers, providing a community and inspiration, a day where we proudly usher in a better future. <fin>
Recorded by Yoosun Keum
Summarized by Kyungsun Chung, Youngjin Ma, Sunmoon Jang
