Regulation
Narina Mnatsakanian, executive director – sustainability centre at Van Lanschot Kempen, says processes are evolving in line with the regulatory frameworks, and that the way one can influence the regulatory outlook is by being part of industry committees.
Sandra Crowl, head of stewardship at Carmignac, provides a practical example of this. She says regulators have begun to focus more on biodiversity issues in recent years, and this is feeding through to the products coming to market.
An example of these processes is the recent announcement from JO Hambro Capital Management that it is linking with the University of Exeter to create a partnership to collaborate in research and executive education around sustainability issues.
Outlining the aims of the partnership, Andrew Parry, head of investments at Regnan, which is the sustainable investing arm of JOHCM, says: “We’re delighted to agree this partnership with University of Exeter.
"They are at the forefront of research into climate change and other issues around sustainable systems, supporting this research and ensuring our investment teams remain at the cutting edge of sustainability is crucial to our clients.”
Elliot says she also builds links with charitable organisations as many of those have insights into issues that “may not be investible today, or for 10 years, but we are gaining insights from them now which could be valuable in the future.
"By looking at these issues at quite an early stage, we are also better able to understand who will be the leaders in those fields in the future, when perhaps they are at the stage where we can invest in them.”
Tom Sparke, investment director at GDIM, a discretionary fund house that works with advisers to construct ESG portfolios, says advisers do ask him questions around how his processes keep up with the latest client concerns in the ESG space.
He says: “We use a ‘best endeavours approach’, which means we will use funds with the most impactful positive factors wherever possible.”
Minesh Patel runs EA Financial Solutions, an advice firm in London. He says the start of the process with any client who has ESG as a priority is to use the fact-find to understand which areas of ESG is a focus for them.
He says: “ESG is a very general term, and it does not always help when a fund is just labelled ESG as that can lead to a lot of greenwashing. But where the labelling is more clear, for example, if it has sustainability in the name of the fund, that is telling us where the fund is focused.
