It’s an exciting time for the environmental, social, and governance (ESG) investing landscape. Many industries worldwide are embracing initiatives focused on reducing carbon emissions, including developing new clean technologies. For instance, chemical industry leaders are uniting to drive innovation in the sector as part of the newly relaunched Global Impact Coalition (GIC).
Amid the surge of ESG investments, Vancouver-based venture capitalist Yazan Al Homsi says now is the perfect time for climate tech companies to thrive. Here, he delves into the case study of one such company: Aduro Clean Technologies (or Aduro). He also breaks down the wider ESG investment implications of the GIC’s relaunch and explains why ESG investors should keep an eye on the Middle East and Canada.
Aduro Clean Technologies: A Case Study in Steady Growth
Al Homsi is a proud investor in Aduro. The company’s innovative Hydrochemolytic™ Technology (HCT) is a water-based chemical process that recycles plastic waste.
HCT can turn all plastics into high-value feedstock for new plastics and other chemicals. The process also involves minimal sorting and cleaning. As a result, it significantly cuts down on emissions during production compared to making new, or “virgin,” plastic. HCT also produces fewer emissions than current recycling methods.
Based in Canada, Aduro has a global outlook. The company has expanded its presence in Europe by collaborating with the Brightlands Chemelot Campus in the Netherlands.
Brightlands serves as a hub for more than 100 companies. These companies seek to improve the sustainability of the chemical industry’s operations and products through new technologies and processes.
Eric Appelman, Brightlands’ business development director and chief technology officer, recently became Aduro’s chief revenue officer. Appelman will help the company commercialize HCT worldwide.
Tech Talks and Pilot Plans
Aduro is in talks with leading global petrochemical firms, validating its technology through its Customer Engagement Program. The program’s demonstration unit can process diverse feedstocks to produce the desired output for each potential client.
In its next phase, Aduro will construct a small commercial pilot plant to showcase capabilities on a larger scale.
The Shell GameChanger Program
Oil industry giant Shell chose Aduro as one of the companies to benefit from its GameChanger program. The program accelerates commercialization by sharing expert insights and providing non-dilutive funding.
Aduro’s GameChanger experience is drawing to a close. However, the insights and data the company has obtained from the program will enable it to refine the construction of its upcoming pilot plant.
Licensing Scalable Technology
In contrast to other companies at a similar development stage, Aduro doesn’t plan to build its own plastic recycling facilities. Instead, the company will license its scalable technology to end users.
HCT’s flexibility makes it suitable for small community-scale projects and recycling centers for large populations. The tech could also enhance existing facilities, enabling them to process forms of plastic they don’t currently recycle.
Yazan Al Homsi’s Perspective on Aduro’s Potential
It’s taken years for Aduro to develop its recycling tech. The company carried out its research discreetly, proving the technology works before introducing its capabilities to the market.
Now, Shell and other global conglomerates are expressing interest in, helping with, and testing Aduro’s technology. The company’s pilot plant is also imminent. With its commercialization process taking off, Al Homsi believes the conditions are ripe for Aduro to experience a breakthrough.
On top of this, Aduro’s valuation lags behind its peers’. Al Homsi explains that this could be due to the company’s prolonged low-profile approach.
“With investments in the space increasing and political pressure creating real-world action, companies like Aduro Clean Technologies may be developing at just the right time,” Al Homsi says.
Yazan Al Homsi on Investment Opportunities in the Middle East and Canada
This heightened interest in Aduro and HCT coincides with a global increase in funding for similar efficient and sustainable technologies.
For years, there’s been discussion about the green revolution, carbon emission reduction, and environmental cleanup. Now, many major industry stakeholders are collaborating to drive initiatives for tangible change. Here are the sectors and markets Al Homsi suggests ESG investors monitor for opportunities.
The GIC’s Net-Zero Emissions Focus
The Low-Carbon Emitting Technologies (LCET) initiative recently relaunched as the independent Global Impact Coalition.Led by the CEOs of seven of the world’s chemical industry leaders, the GIC plans to help the sector achieve net-zero emissions by 2050. The Coalition aims to reach this goal by supporting new low-carbon-emission technologies.
The GIC will nurture innovative projects using the LCET’s proven incubation approach. Its first initiative is a Research and Development (R&D) Hub for Plastic Waste Processing.
The R&D Hub will develop waste processing technologies that improve plastic recycling efficiency and produce less carbon. The GIC aims for the initiative to create practical solutions that enable increased use of circular plastics with reduced environmental impact.
Al Homsi recommends that investors keeping an eye on sustainable and low-carbon technologies worldwide find opportunities through the GIC’s projects.
COP28 And the Middle East
Given its abundant fossil fuel resources, the Middle East plays a major role in the worldwide petrochemical industry. One of the GIC’s founding member companies is Saudi-based SABIC. Saudi Aramco, the largest oil producer globally, owns 70% of SABIC’s shares.
Al Homsi says the GIC’s initiatives could have broader implications for the region’s chemical industry. Over the last few years, the Middle East has introduced several initiatives targeted at reducing carbon emissions and fighting climate change.
In 2023, Dubai hosted the United Nations Climate Change Conference (COP28). Stakeholders across several industries committed more than $85 billion toward initiatives that could significantly reduce emissions and carbon footprint, including recycling.
With an established presence in Canada and Europe, Aduro has ambitions to enter the Middle East with partners in the next few years. Al Homsi says expanding climate tech companies like Aduro offer “a unique opportunity for investors that are looking to do well both socially and financially.”
The Net-Zero Emissions Landscape in Canada
Canada represents another market with great potential for chemical industry investment opportunities. Al Homsi suggests ESG-tech investors watch the country’s chemical sector as it innovates toward its 2050 net-zero emissions goal. The Canadian government enacted the Net-Zero Emissions Accountability Act in 2020.
Organizations like the Chemical Industry Association of Canada (CIAC), which represents the nation’s chemistry and plastics sector leaders, are taking action to meet net-zero emissions targets. There are likely to be other ESG investment opportunities in Canada with a similar story to Aduro’s.
About Yazan Al Homsi
Yazan Al Homsi is a Saudi Arabian entrepreneur, technology investor, and venture capital managing partner. With experience in sales and notable financial advisory roles in the Middle East and Canada, he currently manages Founders Round Capital in Vancouver and Catalystwire Communications DMCC in Dubai. He previously spent over 10 years as a PricewaterhouseCoopers (PwC) director and senior manager, specializing in financial due diligence and valuation.
Al Homsi frequently shares insights into topics like start-ups, investments, and ESG funds on his LinkedIn profile.