Nili Gilbert ’03
THE REIMAGINER
AFTER LEADING IN the sustainability field for over 15 years, Nili Gilbert is now embracing the opportunity to influence change in the global economy on a larger scale as vice chairwoman of Carbon Direct.
Carbon Direct, founded in 2019 by Jonathan Goldberg (who sits on the advisory board at Columbia’s Center on Global Energy Policy), is a carbon management company dedicated to making climate science actionable through two separate businesses: The first assists clients (mainly companies and municipalities) with their decarbonization goals, and the second invests to build up the industry of companies that can help them do so. Both businesses are supported by a team of over 30 carbon scientists.
Before joining Carbon Direct, Gilbert spent 10 years as co-founder and portfolio manager of Matarin Capital, an investment firm that became one of the larger women-owned asset management firms in the US.
During her time at Matarin and long before it, Gilbert had been a proponent and a practitioner of ESG investing, which takes into account environmental, social, and governance factors. By 2020, however, she was harboring persistent doubts that even the explosive popularity of ESG would be sufficient to push the changes necessary to limit global warming to 1.5 degrees Celsius, the goal of the Paris Agreement.
“What we really need to do is reimagine and rebuild the whole global economy in a way that pushes toward net zero emissions, while also addressing the longstanding social inequities that our high-emitting economy is built on top of,” Gilbert says. “And this is not a work of tweaking around the edges; we’re talking about a deep redesign and deep rebalance from something old into something new.”
She’d noticed that even investors excited about adopting an ESG lens were still sensitive about their portfolios’ performance against the most common market benchmarks — “but the benchmark itself is dirty,” Gilbert says. She discovered that if she were to take a snapshot of the broad market indexes as a proxy for the global economy, the world would be set to warm by around 4 degrees Celsius, significantly above the 1.5 degree goal. “We need to do something completely different to get to where we need to go,” Gilbert says.
For a year before joining Carbon Direct, she worked within the UN system, and still serves as chair for US policy of the UN-convened NetZero Asset Owner Alliance and as chair of the Advisory Panel of technical experts for the Glasgow Financial Alliance for Net Zero, crafting the standards for financial institutions that have pledged to decarbonize.
Even as she did this work, a question still nagged at her: As the economy transitions away from fossil fuel dependency, what is it transitioning toward?
“A lot of time and energy goes into managing the old economy out of its current state,” Gilbert says. “I saw the need for much louder, bigger conversations around how we’re going to build the new economy that’s going to replace it.” In other words, to quickly transition away from an economy that relies on carbon-emitting fossil fuels, an array of clean-energy solutions will need to scale up quickly to lay the foundation for a new green economy.
Seeking out and investing in such solutions is exactly what Gilbert now does on the team at the independent investment firm Carbon Direct Capital, by scaling “negative emissions” and other carbon management tools and companies.
“We have all these corporations that have pledged net zero that now need to buy products to support those pledges,” Gilbert explains. Such products include carbon capture and removal technologies for heavy industry, like carbon recycling through utilization, as well as green fuels like green hydrogen or sustainable aviation fuels.
Carbon Direct Capital makes growth equity investments in such technologies. Gilbert says that in deciding whether to take a stake in a given technology or company, Carbon Direct Capital begins by screening for investments that address 100 million tonne annual emissions challenges. From there, investment candidates are subject to rigorous technical, scientific, commercial, and financial scrutiny. “We think it’s important to demonstrate investment success in this field, because of the amount of capital that needs to come into it,” Gilbert says. “With this diligent approach, we believe we can mitigate risk while optimizing both return outcomes and climate outcomes.”
She notes that estimates suggest the capital required to achieve net zero will reach between $5 trillion to $6 trillion annually, through 2050. Government grants and philanthropic funding will be important to get companies ready, but she says Carbon Direct Capital aims to play a part in establishing the traditional private investment flows that are also crucial.