Investment Proposal Draft

To: Professor Clark Hansen, CEO, AMDP

From: Alexis Santos, Research and Development Analyst, AMDP

Date: March 5th, 2024

Subject: Proposal to consider investment in Veja

Dear Mr. Hansen,

In line with Anima Mundi Development Partners' values of social responsibility, environmental sustainability, and profitability, I propose that AMDP invest in Veja. Veja is a company that focuses on having "one foot in design and the other in social responsibility". Before diving into what this means for Veja, I want to set a foundation on which we shape our investment criteria.

Fundamental Concepts


  • Triple Bottom Line - A business concept that states firms should not solely focus on generating profit, but also be conscious of their social and environmental impact (Harvard Business School).


  • Corporate Social Responsibility - An idea that a "business has a responsibility to the society that exists around it". This responsibility can be present in forms such as: Environmental Responsibility, Ethical Responsibility, Philanthropic Responsibility, or Economic Responsibility (Harvard Business School).


  • Social Enterprise - A business with "certain social objectives" as the main function while utilizing a "commercial structure to run the organization". Typically, social enterprises focus on "making a strong societal impact while maximizing profits" in which the funds are recycled into their social programs (Corporate Finance Institute).


  • Corporate Carbon Footprint (CFF) - This is the “total amount of GHG emissions that are directly or indirectly caused by a company’s activities”.Measuring a company’s CCF relies on the standards by which the company follows and “the data on [the] business activities”, since “almost every action and decision made by a company can contribute to carbon emissions, so the more comprehensive and exact this data is, the more accurate [the] CCF will be” (OneTrust). 


Company Description


Veja is a certified B corporation that creates footwear with an emphasis on their sustainability and social responsibility. Veja is based in Paris, France and was founded in 2004.Veja’s mission is to create long-lasting sneakers that have positive social and environmental impacts.


  • Transparency - Veja is committed to giving consumer’s complete transparency into the production process of their shoes. Veja provides full pricing information on how much they pay for their materials from producers and also releases the contracts offered to producers.In terms of product quality all of their cotton is certified organic and they release chemical test results on the sneakers they create (Veja). 


  • Carbon Emissions -  Veja is adamant in being conscious of the effects of Carbon Emissions stating “we believe the only way to defeat [carbon emission] blind spots is to calculate everything and release everything”(Veja).Veja descriptively lays out their production process and the amount of carbon emissions released at each point. Veja goes even further to release the breakdown of how much carbon each type of shoe model produces. Lastly, Veja continues to seek ways to reduce carbon emissions such as completely banning the use of Airfreight to transport their products allowing them to reduce transportation carbon emissions by 92%.


  • Fair Trade - Veja gives back to its produces by “increasing producer income”. Veja works directly with producers and guarantees the purchase of their products while paying a price that “makes sure producers can live decently and reinvest in their farm”. Veja pays producers prices decorrelated from the market to provide greater financial stability (Veja).


Veja is quite a large private corporation, but it continues to show tremendous growth in the last few years and as the awareness for sustainability increases I believe they will grow as well.Veja has over 500 employees and recorded a revenue of $283 million in 2022, a 44% increase from 2021 (Bloomberg).


Opinions

Case for Consideration


WORKS CITED

https://project.veja-store.com/en/single/sneakers

https://online.hbs.edu/blog/post/what-is-the-triple-bottom-line

https://online.hbs.edu/blog/post/types-of-corporate-social-responsibility 

https://corporatefinanceinstitute.com/resources/esg/social-enterprise/\

https://www.onetrust.com/blog/corporate-carbon-footprint-guide/#:~:text=A%20company's%20carbon%20footprint%2C%20also,clarity%20on%20your%20emissions%20hotspots.

https://project.veja-store.com/en/single/fairtrade





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