Nicholas Cocks
Nicholas Cocks is managing partner and co-founder of Velocity Ventures, a
Singapore-based venture capital firm with a unique focus on the Travel
and Hospitality industry in South-east Asia.
During COP27 held in Egypt last month, the United Nations World
Tourism Organisation (UNWTO) urged the tourism industry to take urgent
action to reach net zero, and discussed the pathways to achieve
measurement and decarbonisation, as well as regeneration and finance.
According to the latest “United in Science” Report, CO2 emissions are
on the rise with atmospheric greenhouse gas (GHG) concentrations
reaching record levels driving rapid climate change which in turn
threatens our way of life on earth. There is an urgent need to for
every individual or corporate to take action.
In 2022, climate change resulted in extreme heat and floods, and CO2 emissions were higher than 2019 levels. Photo Credit: United in Science
Nobody can afford to be complacent as climate change intensifies and takes a toll on socio-economic development.
Common challenges across our industry to reach our net zero targets
range from accurate emission measurement and reporting, to a fragmented
regulatory landscape, insufficient budgets or hard to replace
infrastructure.
There are subsectors where costs for transformation can be
prohibitive, resulting in a long-transition to net zero. Such is the
case for asset-heavy sectors in the travel and tourism industry:
aviation, cruise or hotels where it will take time to implement
infrastructure improvements, or switch to hydrogen or electric powered
solutions to reduce absolute carbon emissions.
As global leaders shift their attention to climate finance, COP27 saw
US$4 to $6 trillion a year committed for investments in technology and
infrastructure. Therein lies an opportunity to simultaneously tackle
climate change and drive digitalisation in Southeast Asia where 4 out of
11 unicorns come from Travel & Hospitality.
The biggest contributor of greenhouse gases surrounding travel is aviation. Photo Credit: WTTC Net Zero Roadmap
Concurrently, consumer sentiments are changing – often ahead of
regulatory changes. Travellers are becoming more conscious of their
environmental footprint and are looking for more sustainable travel
options.
These factors together means industries should take the lead, and act ahead of government policy.
To play our part and drive the future resilience of tourism, our fund
invests in high growth startups, from Seed to Series A. We take a
sector-strategic expertise approach and employ institutional financial
discipline to seek out new projects for economic diversification and
market-creation.
We hope to galvanise more organisations within our industry to invest
in our future collectively, and place future considerations about how
business can reduce greenhouse gas emissions and achieve carbon
neutrality with investments in long-term and systemic change.
For example, hoteliers can invest in technology and transform their
properties to be less reliant on fossil fuels. Contributing to
regenerative projects that protect forests and coastal ecosystems can
also help companies reduce their carbon footprint.
The emission profiles are estimates based on a sample of business emission analysed for this report. Photo Credit: WTTC Net Zero Roadmap
Velocity Ventures has recently invested in New Zealand enviro-tech
company CarbonClick that offers corporates and consumers options to
off-set the carbon foot print associated with their travel. They offer
high-quality carbon offset programmes by showing where and how their
contributions have been used with a “track and trace” feature providing
full details of the offset.
While voluntary offsets provides a proactive solution for corporates
and consumers to stay ahead of slower moving industry schemes or
government regulation, it is also important for tourism businesses to
shift investment and financing towards decarbonising our planet’s future.
Entrepreneurs will play a key role in achieving our industry’s
transformation to Net-Zero, bringing to market the technologies that are
needed to drive this change. Velocity Ventures is committed to
supporting their ambitions, taking pro-active steps to invest and help
grow their companies and the technologies that will allow us to achieve a
low carbon world.
To find out more about what other tourism organisations are doing to reach their Net-Zero goals, download our report here.