Drake and other celebrities support finance firm’s efforts to offset their carbon footprint

Grammy-winning rapper Drake is the latest in a group of celebrities – including actors Robert Downey Jr., Leonardo DiCaprio and Orlando Bloom – is teaming up with California-based company Aspiration to find ways to cut back on significant carbon footprint linked to being an international superstar. .

The eco-friendly financial services company will check Drake’s schedule, events and trips to calculate his carbon footprint. Part of Aspiration’s approach includes a reforestation program that plants millions of trees across the country to offset carbon overload.

For Drake, who had 31 concert dates in 2019 spanning Los Angeles to Rio de Janeiro and London to Paris, his private jet – dubbed “Air Drake” – the impact of his carbon footprint requires some calculation.

“Drake’s carbon footprint is bigger than yours or mine,” said Andrei Cherny, CEO of Aspiration. “If Aspiration is able to help [him] cut its negative impact on the planet, we can help everyone.

He praises Drake for leading what he describes as “a cultural movement to inspire people to take simple, automated and personalized action to tackle the climate crisis.”

Data on Drake’s actual carbon footprint calculation was not available, but a proprietary algorithm makes it easy to establish carbon neutrality, according to Aspiration. The company will also engage a third party auditor to validate Drake’s business as carbon neutral.

“We have software that takes the contribution of an individual or business in all parts of their business: transportation, production of products and the carbon footprint of consumers who consume those products,” said the co-founder of Aspiration, Joe Sanberg. “Based on the data that we get from our customers, including Drake, we are able to calculate the carbon emissions from all of these activities, and then we are able to calculate how many trees we need to plant under. our reforestation program and for what period of time. “

A reforestation program is one of the ways the financial services company helps offset customers’ carbon footprints. (Brian Garrity / Unsplash)

It takes just over 1,000 trees planted to offset the emissions of an average person, each absorbing about 31 pounds of carbon dioxide, according to the nonprofit conservation group Saving Nature.

“It’s exciting to partner with a company that has found a simple way to provide everyone with the opportunity to reduce their carbon footprint,” Drake said in a statement. “Aspiration’s innovative approach to tackling climate change is truly inspiring, and I hope that together we can help motivate and raise awareness. “

Integrated sustainability

Cherny, an economic policy expert and former speechwriter for President Bill Clinton, and Sanberg, a progressive entrepreneur and investor, co-founded Aspiration in 2013 and opened in 2015. Since its launch, the company has gained 4 million customers and $ 250 million. with the support of investors including Downey Jr., DiCaprio and Bloom.

Although the company provides everyday banking products, Sanberg describes Aspiration as a “sustainability service provider”, rather than a conventional bank.

“We offer financial products such as bank accounts, investment products and a credit card,” he said. “All of these products are made special by the automated sustainability features they have associated with them. So you can turn those everyday financial products into more than where you deposit your paycheck or what to use for shopping.

Over the past year, the company’s home and business customers have funded the planting of more than 15 million trees in the United States, Sanberg said, adding that more than 5 billion trees were planned to be planted. ‘trees over the next 20 years.

Aspiration’s efforts include the “Plant Your Change” program, which allows customers to round up any transaction to the nearest dollar to plant a tree as part of the company’s reforestation program. The Aspiration Redwood Fund is a sustainable mutual fund that invests only in environmentally friendly companies. The planet protection program accounts for the carbon production of drivers, then purchases carbon offsets to counter the climate impact.

The company also offers a mobile application – Aspiration Impact Measurement, or AIM – which uses more than 75,000 data points to assess a company’s sustainability.

“It’s like a FitBit for Your Sustainability that shows how the places where you use your Aspiration card are treating their workers and the environment,” Sanberg said.

AIM’s “human” scores reflect company metrics such as employee compensation, access to healthcare and workforce diversity. The “Planet” scores measure greenhouse gas emissions, energy efficiency and the use of renewable energies.

“The harsh truth is that most people deposit their money in large financial institutions, which use that money to fund loans to oil, gas, coal, guns and private prison companies,” Sanberg said. . “When they find out that their money is being used to violate their values, they want to change and they know that at Aspiration, their money is never loaned for these kinds of activities.

“When you deposit your money with Aspiration, we deposit it with one of the commercial banks in our network of commercial banks which provides loans to individuals who buy homes or start small businesses. “

Future product offerings, Sanberg said, will include carbon neutral insurance and “green” mortgages.

Sustainable development on the rise in the banking sector

Aspiration executives believe the market for sustainability services will grow dramatically over time.

“There is not a year in the foreseeable future when fewer people will want to take personal action to tackle the climate crisis,” Cherny said. “The aspiration is unique because what we deliver is sustainability itself, helping people and businesses to easily and automatically integrate sustainable actions into their daily lives. “

“Businesses go from not paying for sustainability services to paying them in a short time,” Sanberg said. “I think of it like adopting websites 25 years ago. In no time, every business has gone from no website to no website.

Zilvinas Bareisis, head of retail banking at Celent, a Boston-based consulting firm, says in a research paper that the banking industry is taking important steps to reverse the effects of climate change.

“As the Paris Agreement to limit global warming entered into force in 2016, banks were increasingly aware of the risks climate change posed to their business,” Bareisis said. “While risk management still matters, banks are now focusing on proactive efforts and what they can do to positively influence change. “

The Bareisis article also highlights a set of guidelines being developed by the industry for the future.

The Principles for Responsible Banking (PRB), announced at the United Nations General Assembly in September 2019, “provide a framework for a sustainable banking system and help the industry demonstrate how it makes a positive contribution to society”.

The Principles for Responsible Banking, announced in 2019 by the United Nations General Assembly, are designed to provide the framework for a sustainable banking system. (Source: United Nations Environment Program Financial Initiative)

The 235 PRB signatory banks – with total assets of over $ 60 trillion and from 69 countries – typically engage in loans to green initiatives, financing energy-efficient properties and issuing green bonds linked to sustainability goals, just like Aspiration.

As a financial company and not a chartered bank, Aspiration is not a signatory institution of the PRB. But its leaders consider the company to be uniquely positioned to meet the challenge of climate change through its traditional banking products.

“One of our opportunities is that we are creating a whole new category; there really isn’t a set of competitors out there, ”Sanberg said. “We are one of the only sustainability service providers that are branded and technology-driven. There is only one Aspiration brand, and that puts us in an interesting and privileged position, but also one where we have a lot of responsibilities on our shoulders.

(Edited by Judith Isacoff and Matthew B. Hall)

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