UNC Kenan-Flagler Business School
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Interviewed March 2007

Bruno Erbisti is an Associate with BDF Management and a 2002 alumnus of UNC Kenan-Flagler Business School. In his current position, Bruno manages the Bioenergy Development Fund (BDF), a private equity fund that invests in the sugar, ethanol, and biodiesel industries in Latin America. Since he joined BDF in 2006, Bruno has developed the fund's own environmental, social, and corporate governance (ESG) risk management system as well as analyzed the financial and ESG performance of target companies to make cases for investment. Before working with BDF, Bruno was an SRI Analyst for ABN AMRO in Brazil.

Bruno was born and raised in Brazil. He earned a BS in Economics from Pontificia Universidade Catolica in Rio de Janeiro and stayed in Brazil after graduation to work for five years in various finance and consulting positions. To take his career to the next level, Bruno determined that he needed stronger general management skills, so he sought an MBA. He chose to attend UNC Kenan-Flagler for the strength of its program in teaching these skills.

Along with the traditional MBA skills he sought, Kenan-Flagler also gave Bruno his first exposure to sustainability. During his MBA, Bruno worked with classmates and one of the school's professors to establish the Finance Institute for Global Sustainability, an NGO assisting organizations understand the positive relationship between sustainable business and financial performance. Bruno earned his MBA with a concentration in sustainable enterprise and stayed in Chapel Hill for a year after graduation working with a local consulting group, Environment & Finance Enterprise. In this position, Bruno realized that the finance industry had great power to promote sustainable development through its broad reach and leveraging power, aligning incentives and requiring companies to implement sustainable practices as a condition of funding. This convinced Bruno that the best opportunities for him to affect change were in the finance sector.

In 2003, Bruno decided to return to Brazil, where more businesses were focused on sustainable initiatives. Finding sustainable ways for business to improve the social situation is a much more critical task in Brazil due largely to the serious social problems (extreme wealth gap, poverty, etc.) that plague the country. Bruno chose to work as an Analyst and Portfolio Manager for ABN AMRO Asset Management on their Socially Responsible Investment (SRI) team.

Among other things, Bruno managed the SRI fund at ABN AMRO in Brazil (incidentally, the first SRI fund to operate in an emerging market). In analyzing companies to recommend for the fund, Bruno considered both the companies' financial health and how they addressed ESG issues. Only those who led their industry in both were considered as investments. According to ABN AMRO, this resulted in the $100 million SRI fund outperforming the benchmark by more than 25% from May 2003-November 2006, the period when Bruno worked at the firm.

By identifying the companies doing the best job in addressing their ESG issues, Bruno was identifying the companies with the best management teams, a critical element in considering investment. As Bruno said, "the best managers were those with a long-term view who foster long-term value." The environmental and social impacts of your business are long-term considerations that can translate into financial value and competitive advantage. According to Bruno, "if you don't learn to incorporate social and environmental impact management into your general business practice, then you risk not being in business in ten years. The world is changing and companies need to change to compete." The goal should be to integrate sustainability into the core of business strategies, which will lead to profitability.

When asked what the main challenge to incorporating sustainable business practice is, Bruno cited the pressure on managers to focus on short-term profits over long-term value, where they operate to maximize their bonuses in the next year, as opposed to shareholder value in the long run. He also thinks that, as long as people lack a macro-view of the world and think that their actions are not connected to other people or to the future, they will not be motivated to make their operations more sustainable.

Bruno credits his MBA education at UNC Kenan-Flagler for broadening his view of business which has contributed to his own success. It helped him develop the macro-view he sees as so vital to success in leading to competitive advantage, more cross-sector partnering, long-term value creation, and better managers. He uses that perspective to his advantage as he works to promote the growth of the biofuels industry through BDF.

At a time when developing alternative energy sources is at the top of political and business agendas worldwide, Bruno says he is excited to be working in biofuels in Brazil, the largest exporter of ethanol fuel for cars. As the oil crisis continues, Bruno sees the biofuels industry expanding and that, "to be in Brazil working in biofuels is to be at the forefront on change." With BDF, he is in a position to make a real contribution in mainstreaming biofuels and changing the world for the better.

Bruno's Picks

Sustainability Reading Recommendation:

The Corporation By: Joel Bakan

Usually, we don't spend much time thinking about the mechanics of our economic system, what are the incentives in place for the different actors, what drives corporate behavior, etc. Although we are all part of the system, we are too busy rushing from meeting to meeting and focused on the micro level to think about these issues. This book puts all these things into perspective. It provides a macro view of the system, inviting the reader to question how sustainable it really is, to contemplate the role each of us is playing, and to wonder how we are going to be perceived by future generations - as successful business leaders or as plunderers of the planet.

Nominee for Sustainability Superstar:

Al Gore. By compiling all the research and data on climate change produced over decades of scientific work and presenting it on a clear, concise, and compelling way, Al Gore was able to raise awareness on climate change in an unprecedented way, convincing even the most skeptical about the need to address the issue with urgency. As a result of his crusade, global warming is now on the top of the agenda of society as a whole, putting pressure on businesses and governments to work together towards a solution. Believing we contribute to part of the solution, we at BDF are grateful to him.



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