2024 Grunin Prize for Law and Social Entrepreneurship
The Grunin Center administers the Grunin Prize for Law and Social Entrepreneurship to celebrate the contributions of lawyers who purposefully engage in advancing the fields of social entrepreneurship, impact investing, and sustainable development.
The Grunin Center for Law and Social Entrepreneurship is made possible through a generous endowment from NYU School of Law graduates Jay Grunin ’67 and Linda Kalmanowitz Grunin ’67, and the Grunin Foundation. Jay and Linda have dedicated their philanthropic endeavors to investing in innovative projects that have measurable impacts creating meaningful, transformative change.
Grunin Prize Winner
Calvert Impact and Morgan Lewis Cut Carbon Notes
Nominated Legal Team:
Two legal teams are being nominated – Charles A. Sweet and Jeremiah C. Parker, partner and of counsel, respectively, at Morgan Lewis, and Calvert Impact’s in-house legal department, particularly Emmeline Liu and associate general counsel Alyse Young.
Emmeline Liu, General Counsel at Calvert Impact. Joe Meginnes, Director of Strategy, New Product Legal and Operations, at Calvert Impact. Alyse Young, Associate General Counsel of Calvert Impact Capital. Charles A. Sweet, Partner at Morgan Lewis, Jeremiah C. Parker, Of Counsel at Morgan Lewis, Deborah A. Stern, Structured Transactions Associate at Morgan Lewis, Fiona E. Murphy, Structured Transactions Associate at Morgan Lewis, Sarah A. Nelson, Partner at Morgan Lewis, Ester Lee, Tax Associate at Morgan Lewis, Tomer J. Inbar, Tax Partner at Morgan Lewis, Chelsea R. Rubin, Tax Associate at Morgan Lewis, Kevin J. Biron, Litigation Partner at Morgan Lewis.
The Project:
Calvert Impact, a global nonprofit investment firm and pioneer in impact investing, has provided and facilitated financing to CPACE lenders for multiple years, from the days these instruments became available to commercial building owners and managers to fund green improvements to commercial properties across the United States. As the climate crisis worsened and the limitations of traditional financing options became increasingly clear, Calvert Impact began to focus on securitization as a possible efficient solution, specifically an asset-backed, investment grade rated, fixed-income product backed by the cash flows on CPACE assets and publicly available to retail investors. The lofty goal of this new investment product would be to both drive sustainable building activity and reduce carbon emissions from commercial buildings in the United States.
Working closely over the course of multiple years, the Calvert Impact and Morgan Lewis teams devised a novel securitization structure using a 501(c)(3) nonprofit issuing entity to bring that vision to life in the Cut Carbon Notes. The Cut Carbon Note is a secured, investment-grade rated, fixed-income product that finances sustainability upgrades for commercial buildings, with the objective of reducing carbon emissions. By removing financing obstacles to constructing greener buildings, and pricing to encourage greener buildings (stricter emissions standards are tied to lower cost financing) Cut Carbon Notes make it economically attractive and provide economic incentives to put sustainability at the forefront of building decisions in the commercial real estate market in the United States. While there are many products available to accredited investors, the Cut Carbon Notes are unique in that they are available to retail investors as well. This aligns with Calvert Impact’s dedication to democratizing access to impact investing. The initial issuance of the Cut Carbon Notes placed $29,700,000 in securities with 70+ investors, among them millennials investing through their retirement accounts, individual clients at 16 financial advisory firms, and institutional green bond buyers. Calvert Impact intends to issue a total of $400 million of Cut Carbon Notes, and the securitization structure the legal teams devised is easily replicable and could be duplicated and scaled by other market participants, potentially driving an exponential impact beyond the initial issuance. It is also a model which could be leveraged to provide a new source of financing for impact products beyond just CPACE assets. We believe that the innovative structure and broad scalability of the Cut Carbon Notes fulfills the mission of the Grunin Award.
Grunin Prize Finalists
Learn more about the finalists below:
- TR Argentina S.A. (TRASA) in the issuance of the first social bond issued by a B Corp in the Argentine market
Nominated Legal Team:
Beccar Varela acted as legal counsel to TR Argentina S.A. (TRASA) in the issuance of the first social bond issued by a B Corp in the Argentine market. The transaction was led by partners Luciana Denegri and María Fernanda Mierez with the participation of associates Julián Alejandro Ojeda and María Belén Tschudy. Luciana Denegri advised on the Capital Markets aspects of the transaction, while María Fernanda Mierez advised on the ESG aspects.
The Project:
TRASA is a corporation that seeks to bring financial inclusion solutions to vulnerable neighborhoods. One of its signature projects is the installation of ATMs and Modular Financial Inclusion Units (UMIFs) in low-income neighborhoods in Argentina (the “Project”) that do not have access points to the financial system. Due to its financial inclusion projects, TRASA was certified as a B Corp in 2021. For the refinancing of The Project, TRASA issued a Social Bond for a nominal value of up to A$ 30,000,000. As a result of this issuance, the proceeds were used to refinance investments already made for the construction, installation and operation of ATMs and Modular Financial Inclusion Units (UMIF) in vulnerable neighborhoods of the Autonomous City of Buenos Aires, and the Provinces of Buenos Aires and in the northern part of the Country (Chaco, Entre Ríos, Misiones and Salta,) benefiting 45,133 families in vulnerable situations.
The bond issue was carried out following the guidelines of the Voluntary Guidelines for the issuance of Social Bonds published by ICMA, which are included in the Guidelines for the issuance of social, green and sustainable (SGS) marketable securities (and the Guide for the issuance of SGS bonds, both of the National Securities Commission and the Guide for Social, Green and Sustainable Bonds in the BYMA – Bolsas y Mercados de Argentina - Panel and its regulations for the issuance of social, green and/or sustainable bonds). The importance of this issuance lies in the fact that financing through the capital market has been directed to financial inclusion projects with a high social impact. The increase in this type of issuance represents for Argentina the possibility of allowing new market players to become debt issuers and that the funds obtained through the capital market reach the sectors of society that need it most -entrepreneurs, small organizations- who often would not otherwise have access to financing, with the consequent impact that this generates.
- Southeast Asia Clean Energy Fund II, L.P. (SEACEF II) to accelerate the energy transition
Nominated Legal Team:
The nominated legal team from IFC is Turgut Cankorel, Sonia Dhawan Madan and Ngozi Helen Agboti. From BII, Ming Da Wang; from FMO, Erik Nieuwland; from Norfund, Tord Pedersen; and from Swedfund, Adam Rångemyr.
Supporting Legal Teams:
The supporting legal team from Dechert: LeeLee Seah, Colin Barraclough, and Dean Collins; from Clifford Chance: Tjerk de Jonge, Alexander Chester, and Esmée Oldenkamp; and from Morgan Lewis: Divya Thakur, Sophia Goh, and Tomer Inbar.
The Project:
Clean energy developers and company owners in the early stages of their development suffer from a shortage of capital, largely due to their high business and regulatory risk profiles, and the need for deep technical expertise. This market gap for early-stage infrastructure projects is especially pronounced for non-sponsored, independent, climate transition projects. Given this market gap, private equity funds can play an important role by providing much needed equity capital while fund managers provide management expertise to accelerate the growth and development of early-stage climate change and renewable energy projects.
Southeast Asia Clean Energy Fund II, L.P. (SEACEF II or the Fund) was set up with a dual-tranche investor structure to address this early stage “funding gap”, by catalyzing capital from commercial investors, development finance institutions, blended finance donors and philanthropic organizations for climate transition and decarbonization projects, and thereby increasing the number of bankable, climate-related projects (in the riskier early phase of development) in emerging markets. The Fund targets investments across South East Asia, with a focus on Indonesia, Viet Nam and the Philippines. The Fund will target two types of businesses: (i) utility-scale solar, wind, and energy storage and (ii) scalable, energy-related businesses such as rooftop solar, energy efficiency, electric mobility, and demand-side and grid management.
The Fund’s selection criteria for investments would include (i) climate impact (potential to generate large scale climate mitigation, creating a precedent for innovation that can transform a market), (ii) additionality (targeted outcome not expected to happen without the Fund’s “intervention” at early entry point, unlocking significant follow-on capital), (iii) potential viability (appropriateness of business model, depth of target market), (iv) E&S impact (level of E&S risk exposure, leverage as an investor and the investee team’s appreciation for the value of ESG performance), (v) team (maturity, dedication, quality of founder team), and (vi) financial return (clear path to exit, potential to place larger rounds of follow-on capital).
- Keidos, The International Program on Impact Law
Nominated Legal Team:
Constanza Connolly, Partner and Director at Keidos, Agostina Coniglio, Partner at Keidos.
Supporting Legal Team:
Roberto Randazzo, Partner and Head of ESG and Impact at Legance, Fabio Gallo Perozzi, Lawyer at Legance, Juan Diego Mujica Filippi, Advisor at Nativa, José Miguel Alfaro, Partner at iitos, Juan Carlos Corvalan, Sustainability and Compliance Manager at Sodimac, María Laura Tinelli, Partner and Director at Acrux Partners, Gabriela Marsiglia, Executive Director of the Alumni Department of Austral University, María Paula Rennella, Executive Director of the Alumni Department of Austral University, and the Austral University Faculty of Law and the Alumni Department.
The Project:
The International Program on Impact Law is the first executive training program on the impact economy, impact investing and purpose-driven companies, aimed at lawyers or advanced law students in Latin America who are developing professionally in different areas and fields of law (companies, law firms, social organisations or the public sector).
The program is dictated at the Universidad Austral of Buenos Aires, Argentina since 2022 addressing different contents from a theoretical-practical point of view with the following scope: 1) Introduction to the impact economy. The role of lawyers in its development and promotion; 2) Purpose driven companies; 3) ESG factors and corporate governance; 4) Impact investing and new financial instruments; 5) Stakeholders: Value and supply chains; and 6) Practical workshop.
Its main purpose is based on highlighting the new and broader role of lawyers empowering legal leaders to become strategic actors that can guide people and organisations to sustainable development by contemplating both the new risks and opportunities that arise. To this end, this program not only allows lawyers to develop new skills or capacities within the fields covered, but also provides them with practical tools and guidance on how these new approaches can be implemented in their professional work fields. The Program's faculty includes lawyers and other professionals on the premise that all of the fields covered by the impact economy require the adoption of a holistic vision that includes a multiplicity of disciplines to facilitate an appropriate approach. All of them are internationally and regionally recognized for their experience and expertise in their respective fields. The recognition of the program would provide greater visibility and emphasise the fundamental role of lawyers, strengthening the importance of their work as well as the imperative need for their participation so that the design of solutions that seek to generate positive impact have the desired effect. Particularly highlighting that legal professionals are agents of change who hold a key role to unlock the full potential of those solutions which are specially needed in a region such as Latin America. Sustainable development requires joint efforts and collaboration to adopt an integral vision. For that the course stresses that the lawyers must team up and work with their colleagues and other professionals to promote a just and sustainable transition for more inclusive economies. The acknowledgment of this program can help catalyse this key position of lawyers helping empower them and the future generations to become leaders that lead the transformations needed.
- FlexCo, the “Flexible Company,” a new corporate form in Austria
Nominated Legal Team:
Keyvan Rastegar, Co-Founder of RPCK | Rastegar Panchal.
Supporting Legal Team:
The initial working group was assembled by Dr. Alma Zadić, LLM, Austria’s Federal Minister of Justice. It consisted of 30 experts from government, academia, private practice, and industry groups. Keyvan was one of three attorneys elected to the working group alongside: Johannes Reich-Rohrwig, Founding Partner at CMS Reich-Rohrwig Hainz; Philipp Kinsky, Founding Partner at Herbst Kinsky Rechtsanwälte. Keyvan was selected as an independent expert known not to be affiliated with any political party or industry group.
The Project:
This reform makes it easier to start a business, raise capital, incentivize employees and stakeholders, and overall grow a company, especially by targeting young, female, and innovative entrepreneurs and investors. The new law was negotiated over three years and highly anticipated in the CEE region.
After over a century of increasing bureaucracy and special interests slowing down businesses and innovation (Austria ranks 127th/190 in “starting a business” in the World Bank rankings), this reform is a telling example of democratic processes working to effect change. Entrepreneurs, investors, experts, and government came together in advocating for and ultimately negotiating legislation and finding common ground to cut red tape and make progress toward international standards.
The FlexCo introduces a number of these overdue features to Austrian law, including: - Being the first federal law written in the generic female form, to increase visibility and awareness for female founders and investors (German distinguishes three genders: male, female and neutral; statutes are traditionally written in the generic male form). - Allowing employees and stakeholders to obtain real equity ownership without being unfairly taxed by creating a special class of shares and new tax rules. - Reducing minimum share capital (from EUR 35.000 to EUR 10.000). - Reducing notarial deed requirements for share transfers and capital raises. - Introducing treasury shares, authorized capital and convertible instruments (convertible notes, SAFEs) into law. - Allowing virtual shareholder meetings and simplifying circular resolutions. - Increasing freedom of contract, including for environmental and social ventures.
Judging Panel
- Deborah K. Burand
- Jay Grunin
- Helen Scott
- Rachel Robbins
- Amélie Baudot