Abu Dhabi The Capital of Green Capital

Good morning everyone. I'm very happy to see a full room um in our audience today. Um we don't have a lot of time so I'll keep my my question short. I'm very pleased to be accompanied by Mouadella and Alterero representatives today. Um they are two of the leading investors in sustainable finance in Abu Dhabi.

Uh Hanan, thank you for being here. We'll start with you first. What is responsible investing at Mubadala and where does it sit in the investment strategy? Mubadala's mandate is to deliver strong riskadjusted returns for our shareholder and provide for current and future generations. Being a responsible investing uh investor is at the heart of that mandate.

It's not a standalone strategy. It is a key enabler of that strategy. Being a responsible investor is not about ideologies. It's not about political positionings. H it's not about trends in the market.

Um it's about providing additional information for better decision making. We see responsible investing as an enabler for value creation and preservation. It provides us with access to capital, opens up new markets. It's about operational efficiencies. Um in short it's really about um if when you look at sustainability in a very pragmatic business focused lens uh you get the financial returns that you want and therefore it's part and part of our strategy.

Thank you very much Karim. Over the past uh year, we have seen Alterara uh shift from a funds of funds approach to a more co-investments direct investment approach. Has the strategy really changed? What's triggered this? Uh

Sure. First of all, thank you for having me and uh it's uh it's great to be here. Um so, as a matter of fact, our strategy did not change. So, Altera was built as a fund of fund with a co-investment model and naturally we started with the fund investment first to kind of you know get the wheels starting and we get more co-investments right and then we can kind of shift gears into u uh deploying capital into these co-investment and this is what basically happens on from the announcement at the cup 28 when Altera was born this is where We uh committed uh uh some capital to uh our main partners which was uh Brookfield, TPG and Black Rockck. And then like maybe 9 months in or or so when all of these funds were um u fully committed and started to deploy we started to to co-invest and on top of that in order to accelerate the uh deployment and impact we started h doing co-investment with other partners because in our network obviously you have 100 plus you know relationship ationship uh we have across geographies and industries and we leverage this to uh accelerate our co-investment program.

Thank you very much Hannah and back to you. How does Mubadala integrate sustainability and climate considerations in the investment approach in a way to keep this balance of reducing emission and pollution but also ensuring returns and ultimately creating long-term value? As I mentioned, the way we look at sustainability is from a value lens. So when we talk about integrating sustainability considerations, we look at it with a view of driving performance um and pro and providing the the financial performance that we're looking for. So if I give you two examples, one of them would be EGA.

So Emirates global aluminum their celestial which is a product aluminum product powered by solar energy um is really an example of how sustainability can open up new markets premium customers in a way that was not there before. Another more detailed example would be our partnership with solutions plus on a project DCRB. This was an initiative uh that we started in 2024 across um 16 of our different portfolio companies to look at decarbonization uh ef efforts and we were able to identify 160 uh energy efficiency measures um that provided us with savings up to 18 million dirhams. And in phase two, we are projecting that we will be getting uh an additional 6.4 four millions of dirhams of annual savings and about eliminating about 100,000 tons of CO2 which really shows that decarbonization efforts especially in built environment is real and it is uh driving uh real value for companies.

Thank you very much Karen. Back to you. Looking ahead, where does C alter the you know the most compelling pipeline for next one or two years? Do you explore sectors, geographies, investment themes? What what looks exciting looking ahead?

So as you know Altera has a quite a diverse uh mandate. So we we have a global mandate across asset classes that's been infrastructure, private equity and credit. So, so we have pipeline across all of these assets, asset classes and geographies. So, it's quite different, you know, where the deal flow in uh uh in each country and so forth. But to give you an example to see again how how you know climate sits in the heart of all the uh events, current events and the AI boom for example.

So all the you know the increase in all these uh u data centers right all of these are you know big part of these that want need to come online very quickly are powered by renewables right so that's and that's across all geographies so that's obviously big theme across u the globe and you have between that on the supply chain right so that's a lot of components a lot of you know between actual components, software, all of the so so our scope is quite wide because we invest AC uh between uh decarbonization, energy transition, sustainable living uh and climate tech. So it's quite wide and we have a very diverse pipeline and very excited on what's uh to come especially in 2026.

Thank you so much Han. You mentioned earlier 160 measures. I want to ask you a bit what tools and metrics does Mubadala use to you know to go through all the due diligence you need to go accountability performance I understand there's a lot of work in the backstage to actually keep all these tools and metrics um to give you all the information in your decision- making what's key here is to speak the business language this is what I talked about earlier um and I want to reemphasize that Um what we have done is we've taken a datadriven pragmatic market benchmarked approach in developing our own tools tools that are resonate with our audience with our investment uh professionals um to ensure that we are providing them with the additional set of information that they need for better decision making. So we have three proprietary tools. Each of them targets a different asset class.

It has a different sustainability targets. Uh first one is our sustainable returns model. A tool that was developed to measure the performance of our direct investments across 19 sustainability factors. It provides with risks and opportunity associated with that particular investment. And that's a model that we use across the investment life cycle whether it's at the beginning part of the due diligence or during the hold period.

And this provides our investment professionals colleagues with the information that they need to drive the operational efficiencies and risks of those uh investments. The other tool that we have is our general partners model which is a model that we use for our uh PE and VC partners and that purpose is to help them not only understand how they are performing but also how can they integrate sustainability into their portfolio companies. Um and finally we have our climate uh integration framework which is a framework that we use um to help our portfolio companies with their decarbonization targets and uh meeting their net zero commitments. And the key to all of these tools, as I said, is pragmatic, datadriven, and really looking at sustainability from a value lens as opposed to any other ideologies.

Thank you very much. Uh Karim, we were uh talking earlier in the speaker's lounge that money matters. Um, Alterero was created with a specific and different mandates to mobilize capture for sustainable investment for um, climate. Yeah. Please tell us more about the approach to mobilize capital at Altera.

Sure. So, so Altera has a dual mandate, right? We want to demonstrate that you can invest across climate strategies without compromising on return, right? you need to make successful investments and you need to make money in order to achieve the impact right so so that's number one and by doing this you can mobilize more capital into climate deals right so again you got more institutional capital into into that and this is and that's the approach where we anchor you know climate funds we um uh seeded two uh funds in emerging market which you know it's obviously challenging. So the way we did this to to um um catalyze and to mobilize capital is that we provided that capital with a cap return on the level of the fund and that to basically incentivize institution investors to come in because we're providing them then with that cushion that basically for um that perceived risk in emerging market right and we're doing it with GPS that have the track record you know in delivering returns and mobilizing capital that was so we launched the um uh Brookfield catalytic transition fund so that's up to5 billion dollar fund and with the TPG uh the global south initiative that's around 2 and a half billion fund and they basically managed to attract new pots of capital as well not just their own you know LP existing LPS new LPs coming into this and we're very proud of you know how things are so far Thank you very much.

Uh we are being notified that this is coming to a closure in a few seconds and I don't want to cut the next speakers. Uh thank you so much Hanan. Thank you so much Karim. Thank you all for your time today. I hope you found it interesting.

Thank you so much.

Thank you.