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Taming the tiger economy

Date: 07 Dec 2009

Citywealth

With only one hundred South China tigers (panthera tigris amoyensis) left in the world, Stuart Bray knows that time is running out for this subspecies that has become endangered due to loss of habitat. The international financier is currently putting together a deal with the Beijing government not only to establish China’s first wildlife reserves for these rare and beautiful animals, but seeking to help save the planet with sustainable development as well.

But, unusually, this isn’t just the philanthrophy of a wealthy man. “These projects must be economically as well as environmentally sustainable,” he says, sitting in his London office.

American-born Bray, 48, runs Conservation Finance International, an FSA-regulated business established to develop market-based solutions for the financing needs of conservation projects and the South China tiger in particular.

The work of CFI has a rarity value in the financial world, aiming to provide profitable, structured deals which focus on forestry conservation, clean energy, water and waste management, and biodiversity projects which first and foremost are designed to make money for investors. For his new series of securities, he is seeking investors primarily in European and Asian markets.

As a youngster Bray aspired to be a maths professor – and he was very good at the subject, obtaining a scholarship to The Colorado College. But, rather than spend his career in the classroom, he chose a life on Wall Street where he put his numerical skills to great advantage – firstly at Credit Suisse First Boston and latterly at Bankers Trust and Deutsche Bank.
“I was reading the newspaper one day and saw an article about how Wall Street banks were hiring mathematicians and scientists for what seemed to me like astronomical amounts of money,” Bray recalls. “I figured this might be a more practical way of applying my maths and one that would help me support a family.”
He never looked back. After moving to London 20 years ago, and marrying former fashion executive Li Quan (who runs the tiger project, Save China’s Tigers), he now heads up one of the UK’s premier conservation finance houses.

The company believes its financial products should be as competitive in the international market as any other. While there is a philanthropic element in the company’s profit margins, that is not the primary goal of CFI’s products. “The SouthChina tiger is a flagship around which we are trying to build a viable commercial model for improving the environment” says Bray. “Philanthropy alone will never be sufficient to address the environmental issues facing the world today.”

His wife runs a 33,000 hectare wildlife reserve in South Africa where the South China tiger cubs are raised in a free-ranging environment and trained to hunt wild prey with the aim of eventually transferring them back to the wild in their country of origin. (Sadly virtually all of the remaining South China tigers reside in Chinese zoos rather than the wild)).
The reintroduction of wild South China tigers presents an important opportunity to raise awareness of the importance of the environment and sustainable development in China. The idea, not dissimilar to the famous Kruger National Park, will meaningfully improve biodiversity in China and provide investors with the opportunity to participate in sustainable development based on eco-tourism in partnership with the Chinese government.

But eco-tourism in China is just a small part of the business. The real profits are to be made from rights CFI has negotiated with the Chinese government on sustainable forestry and carbon credits, and soon, hopefully, clean energy, water and waste-management as well. Bray is working on structured financial packages which will make excellent returns for investors as well as helping the environment.

“The Chinese are much more environmentally aware than they are given credit for,” says Bray. “They realise it is in their interests to look after the planet and that environmental damage hits their GDP.”

Bray argues passionately in favour of governments signing international environmental accords like Kyoto and the forthcoming Copenhagen summit in December. “It makes clear economic sense to have legislation and environmental auditing on a national and international scale, otherwise we are shielding and underestimating the economic costs of growth. In effect, for every two steps taken forward, there is a hidden one step back.”

Bray literally is seeking to tame the tiger economy.

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