ADMP Final

 Clark Hansen

Anima Mundi Development Partners (AMDP)

March 5th 2024 

Investment Proposal


Allbirds


Dear Clark,


In line with the AMDP ESG investment strategy, I highly recommend considering an investment in the environmentally friendly footwear and apparel brand Allbirds. My confidence stems from the brand's commitment to environmental responsibility and its innovative approach to creating products that align with eco-conscious values. Allbirds has positioned itself as a leader in the market, emphasizing not only style and comfort but also a dedication to minimizing its ecological footprint. The brand's emphasis on using eco-friendly materials,such as merino wool, eucalyptus tree fibers, and recycled materials, reducing carbon emissions, and promoting ethical manufacturing practices makes it well-positioned for long-term success in an increasingly conscious consumer market.


Fundamental Concepts


Triple Bottom Line is represented by the three P's—profit, people, and the planet, is a  concept that urges businesses to measure and consider their social and environmental impact alongside financial performance, moving beyond the sole emphasis on profit, or the standard "bottom line. (Harvard Business School)


Corporate Social Responsibility (CSR) is a strategic management concept involving companies integrating social and environmental concerns into their operations, achieving a balance of economic, environmental, and social imperatives through the Triple-Bottom-Line Approach. It differentiates from charity and philanthropy by addressing shareholder and stakeholder expectations and emphasizes a comprehensive alignment of business goals with sustainable development, going beyond traditional philanthropic practices. (United Nations Industrial Development Organization)


Social Enterprise is a participant in the social economy with a primary focus on generating social impact rather than profits for owners or shareholders. It engages in entrepreneurial and innovative market activities, utilizing its profits predominantly for social goals. The management approach is open and responsible, actively involving employees, consumers, and stakeholders impacted by its commercial endeavors. (European Commission)


Corporate Carbon Footprint (CCF), or a company's carbon footprint, represents the overall greenhouse gas (GHG) emissions directly or indirectly attributed to its activities. Calculating the CCF serves as the initial phase toward achieving carbon neutrality, offering insight into emissions hotspots. Identifying and understanding these hotspots is crucial for establishing achievable climate goals and implementing effective reduction strategies


Company Overview:


Sustainability Report Analysis:

As a publicly traded company committed to Environmental, Social, and Governance (ESG) efforts, Allbirds releases its comprehensive Flight Report quarterly and annually, providing a detailed breakdown of their ESG goals, achievements, and strategies. I have thoroughly analyzed the most complete report (Q3 2022),  and have provided a detailed summary of their ongoing sustainability initiatives below. Their primary focus is to decrease their carbon footprint. 

  1. Strategies:

    • Increasing the use of renewable materials in their products.

    • Updating footwear packaging to be more sustainable.

    • Adopting renewable energy sources.

    • Increasing ocean shipping for lower carbon emissions.

    • Decreasing production of high-carbon footprint footwear styles.

  2. Goals:

    • Cut per product carbon footprint in half by the end of 2025.

    • Reduce per product carbon footprint to near zero by 2030.

  3. Achievements:

    • Achieved a 19% reduction in carbon footprint in 2022, exceeding their own predictions.

    • Progressed more than halfway towards their 2025 goals after just two years.

    • Completed 27 different initiatives in 2022 to achieve the reduction.

    • Ahead of schedule in meeting their sustainability targets 5.

  4. Highlights:

    • Allbirds' commitment to consistent, tangible carbon reduction efforts, even if considered "boring," showcases their dedication to their sustainability goals.

    • The focus on science-based progress and the completion of multiple initiatives demonstrate their commitment to making a significant impact through incremental changes.

    • The report emphasizes that sustainability goes beyond carbon reduction, with additional commitments in Fair Labor, Water, Chemistry, Animal Welfare, and Traceability & Transparency 21.

Overall, Allbirds has made significant strides in reducing their carbon footprint and is on track to achieve their ambitious sustainability goals. Their transparent reporting and focus on continuous improvement highlight their commitment to environmental responsibility and sustainable business practices.


Proposal Gameplan

Allbirds combines style with commitment to environmental responsibility and has emerged as a market leader, distinguishing itself through a dedication to sustainable practices and innovation in eco-friendly materials. Not only does the company prioritize comfort and style, but it also actively works towards minimizing its ecological footprint.


Despite recent fluctuations in the market, Allbirds has displayed resilience and maintained a strong position. Zacks.com, a well trusted financial advisor, released proprietary data that assigns Allbirds a Zacks Rank 3, indicating an expected inline return from BIRD shares relative to the market in the coming months. While valuation metrics suggest a possible overvaluation, it's crucial to recognize the company's long-term potential and its positive impact on the environment. (Zacks.com)


A Yahoo Finance article highlights that over the past year, multiple insiders, including Independent Director Daniel Levitan, demonstrated confidence in the company's future by purchasing a significant number of shares. Notably, Levitan made the largest insider purchase, acquiring US$82k worth of shares at a price of US$1.08 each, even when the share price was higher than the recent valuation of US$0.93. (Yahoo Finance).


It is also important to note that Allbirds aligns with the Triple Bottom Line concept, emphasizing profit, people, and the planet. The company's commitment to the Corporate Social Responsibility (CSR) and its status as a Social Enterprise make it an ideal candidate for an investment strategy that considers both financial returns and positive societal impact. Allbirds actively addresses environmental concerns, particularly through its Corporate Carbon Footprint (CCF) reduction initiatives.


Allbirds also provides transparent sustainability reporting, as seen by its comprehensive Flight Reports. Analyzing the Q3 2022 report, I found that Allbirds is making substantial progress towards its sustainability goals. The company aims to halve its per-product carbon footprint by 2025 and reach near-zero carbon emissions by 2030. Remarkably, Allbirds achieved a 19% reduction in its carbon footprint in 2022, surpassing its own predictions. The commitment to tangible carbon reduction, focus on science-based progress, and diverse sustainability initiatives demonstrate Allbirds' dedication to making a positive impact on the environment.


In conclusion, Allbirds is not just a footwear company, it's a force for positive change in the industry. Its transparent reporting, ambitious sustainability goals, and continual progress make it a compelling investment opportunity. Considering its commitment to environmental responsibility and societal well-being, investing in Allbirds aligns seamlessly with our ESG investment strategy.


Best regards,

Jack



Works Cited:

ESG Overview. Allbirds, Inc. (2023, April). https://ir.allbirds.com/esg-overview

Issel, M. (2022, August 25). The corporate carbon footprint: A quick guide. One Trust. https://www.onetrust.com/blog/corporate-carbon-footprint-guide/#:~:text=A%20company%27s%20carbon%20footprint%2C%20also,clarity%20on%20your%20emissions%20hotspots

Miller, K. (2020, December 8). The triple bottom line: What it is & why it’s important. Business Insights Blog. https://online.hbs.edu/blog/post/what-is-the-triple-bottom-line

Social Enterprises. Internal Market, Industry, Entrepreneurship and SMEs. (n.d.). https://single-market-economy.ec.europa.eu/sectors/proximity-and-social-economy/social-economy-eu/social-enterprises_en

What is CSR?. UNIDO. (2023). https://www.unido.org/our-focus/advancing-economic-competitiveness/competitive-trade-capacities-and-corporate-responsibility/corporate-social-responsibility-market-integration/what-csr

Yahoo! (2024, February 8). Favourable signals for Allbirds: Numerous insiders acquired stock. Yahoo! Finance. https://finance.yahoo.com/news/favourable-signals-allbirds-numerous-insiders-120510230.html

Zacks Investment Research. (2024, March 9). AllBirds, Inc. https://www.zacks.com/stock/research/BIRD/stock-style-scores 

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