Marina Severinovsky: The Real Reason Your Portfolio Needs a Climate Plan

Sustainable investing has gone from niche to necessary. But where is it headed next? In this episode, Ignacio sits down with Marina Severinovsky, Head of Sustainability for North America at Schroders, to unpack the shifting ESG landscape. 

Marina draws from two decades of experience in finance and sustainability to explain how investors can navigate today’s volatile mix of climate risk, political backlash, and growing demand for impact.

Topics we cover:

🌍 Why sustainable investing isn’t just about values—it’s about identifying long-term risk and opportunity

💼 How institutional investors are redefining ESG integration across asset classes

💣 The rise (and fallout) of ESG backlash—and why Marina sees it as a “necessary reset”

📊 The trouble with ESG ratings and how Schroders builds proprietary sustainability models

👩‍💼 Women in sustainable finance, and Marina’s unfiltered advice for building a career in ESG

If you’re into impact investing, long-term market trends, and no-BS insights into how sustainability really works in finance, this one’s for you.

Oh, and if you haven't already... subscribe to The Blunt Dollar for more raw and honest finance conversations.

New episodes drop every other week! Available on Spotify, Apple Podcasts, and wherever you get your podcasts.

And last, but not least, don't forget to follow me on LinkedIn: https://www.linkedin.com/in/ignacio-ramirez-moreno-cfa/

Enjoy the episode!

Disclaimer: This podcast is for informational and educational purposes only. It does not constitute financial, investment, or legal advice. Listeners should consult a qualified financial professional before making any financial decisions.

Episode Transcript

Speaker 1 (00:00):
No matter how skeptical somebody might be
overall about sustainability,they have to admit that some of
those changes are environmentaland social in nature.
People misunderstand that allof sustainability is impact, and
it's not.

Speaker 2 (00:11):
Welcome everyone to a new episode of the Blonde
Dollar.
Today we're joined by MarinaSeverinovsky, head of
Sustainability North America atSchroeders.
Marina is a leading expert insustainable investing, helping
some of the largestinstitutional investors navigate
the evolving ESG landscape,integrate sustainability into
their strategies and unlockopportunities in transition

(00:34):
investing.

Speaker 1 (00:35):
Impact has to happen at the company level, but also
at the investor level.
So what you have to be able tosay is I've invested in this
bank that is making these smallloans.
You have to be able to say isI've invested in this bank that
is making these small loans, andif I hadn't given money, if I
hadn't made that investment,they wouldn't be able to do as
much as they're doing now withmy capital.

Speaker 2 (00:50):
What do you think is the biggest misconception about
ESG investing today?

Speaker 1 (00:54):
We left a gap.
We left ourselves vulnerable tosomebody criticizing this,
especially when underperformancebegan, and saying when
underperformance, began andsaying this is the Blonde Dollar

(01:19):
with Ignacio Ramirez.

Speaker 2 (01:22):
Quick disclaimer the views and opinions expressed in
this podcast are those of thespeakers and do not constitute
financial, investment or legaladvice.
This content is forinformational and educational
purposes only and should not berelied upon as a substitute for
professional advice.
Always do your own research andconsult a qualified advisor
before making any financialdecisions.
All investments involve risk,including the potential loss of
capital.
And now let's get started withthe episode.
Welcome everyone to a newepisode of the Blonde Dollar.

(01:46):
Today we're joined by MarinaSeverinovsky, head of
Sustainability North America atSchroeders.
Marina is a leading expert insustainable investing, helping
some of the largestinstitutional investors navigate
the evolving ESG landscape,integrate sustainability into
their strategies and unlockopportunities in transition

(02:06):
investing.
With a background spanninginvestment strategy,
quantitative equities andalternatives, marina brings over
20 years of experience infinance, economics and
consulting.
She has seen firsthand howsustainability has evolved from
a niche focus to a mainstreaminvestment consideration, and
today we'll tap into herinsights on where the industry

(02:27):
is headed.
We'll discuss how institutionalinvestors are adapting to
shifting ESG dynamics and whyclimate and nature risk are
becoming central to portfolioconstruction.
Plus, we'll also explore thepolitical and regulatory forces
impacting sustainable investing,and what investors need to know
as they position themselves forthe future.
If you're an asset manager, aninvestor looking for long-term

(02:50):
trends, or just someone curiousabout the intersection of
finance and sustainability, thisepisode is packed with insights
you won't want to miss.
Marina, it's fantastic to haveyou here.
Welcome to the show.

Speaker 1 (03:04):
Thank you so much for having me.

Speaker 2 (03:06):
So, before we dig into all of that, can you tell
us in a couple of words what isit that you're doing exactly at
Schroeders?

Speaker 1 (03:14):
Yeah, absolutely so.
As you said, I'm the head ofsustainability for the Americas
region at Schroeders.
We are a firm that is based inthe UK.
We have about a trillion dollarsunder management across 60
different asset classes, bothpublic markets and private
markets, and one baseline thatwe have for all of our

(03:36):
investment teams is that theyintegrate considerations of
sustainability, risk and return,including climate risk, into
their work.
Now, they can do it alldifferent ways, right?
So somebody working in realestate versus private equity,
versus public markets, may do itdifferently, but we do want
them to consider these things aspart of their work, and so my
team and I in the Americas arekind of the conduit right, the

(03:58):
support system for the investorsdoing that, and then, at the
same time, we're trying tocommunicate out to our clients,
who are looking for perhapsintegrated strategies or even
strategies that are sustainablein nature.
We have about $120 billion ofstrategies that have a
sustainability objective, andthen we have about $5 billion of
impact strategies as well.
So another part of my job iskind of communicating with our

(04:20):
investors and understanding whatthe market's interested in and
really being kind of aspokesperson for our
capabilities.

Speaker 2 (04:28):
And what led you to specialize in sustainable
investing.
Did you know?
I mean, did you wake up one daywhen you were like five years
old and you said, oh, I want todo this?
Or is it something thathappened gradually over the
years?

Speaker 1 (04:41):
It definitely is something that I came to
gradually over the years,although I will tell this story
now.
I have a daughter who's 10years old, but a couple of years
ago, when she was a little bityounger, she was dressing up as
like for school.
Dress as your hero, and shedressed up as me.
She put on a little suit or likeone of my outfits, and she had
like a Schroeder's branded, likebag and, like you know, mug and

(05:03):
notebook.
And she said I'm, you know, I'mgoing to work.
And she said because my mom ishelping to save climate, save
the world, right, which is verysweet.
And then the year after she wasgoing to do it again and she
said have you resolved climatechange?
Or like, have you fixed climatechange?
And I said no and she said well, if you don't do it by the next
year, I'm going to dress as apolice officer.
You know Pressure, yeah,pressure.

(05:23):
So my point is that it hasmeaning.
It's really important, right,as a human being, as a parent,
right, you think about the worldyou want to leave for your kids
.
But the way that I came to it,I think, is not.
I didn't go to school studyingit.
I think there's a lot of youngpeople now who even my old
university has, you know tons ofprograms now around this, but
20 years ago it didn't.

(05:45):
And I think I came in as aninvestor.
I was an investment banker.
I went into asset management.
I worked in commodities whichis not a particularly friendly
kind of sustainability friendly,although now that same team
does focus on sustainability aswell Commodities, emerging
market bonds, quantitativeequities.
I was a market strategist, andall at the same firm.

(06:05):
So I kind of moved from placeto place, and so part of it was,
I think, Schroeder's evolutionover time over the last 15 years
, the development of thesustainability kind of
investment capability internally, and then part of it was my own
interest, and so it was just agreat opportunity to move into a
place that I think needsinvestment voices.
There has to be a mix of sortof folks who you know come from

(06:29):
kind of a policy background,right, but then there has to be,
you have to mix in people whohave a real kind of investment
background as well, and that'sbeen particularly helpful in the
last couple of years to sort ofcome to these things through
really an investment lens.

Speaker 2 (06:42):
Yeah, and do you think there was a turning point
that made ESG a mainstreaminvestment focus this past
decade?
Like what is it that?
Was there a pivotal momentwhere everyone was like okay,
this is big, this is happeningand this is here to stay?

Speaker 1 (06:58):
It's interesting for you and me and I guess people
listening to kind of think aboutthis history, right, because my
position is that what we do insustainability we have always
done so, schroeder is.
One thing I'll note is we'reall active management, right.
We are literally fundamentalinvestors.
We are looking at the universeI mean, let's say, on the equity
side, looking at stocks, tryingto select the ones that we want
to invest in for the longer run.

(07:20):
We want them to be successful.
There is not a single goodportfolio manager.
If you even went back 40 years,before anybody was saying the
word sustainability, and youwould ask that person look, do
you think about managementquality?
Do you think about howmanagement is compensated in
alignment with theirshareholders?
Do you think about how they'reprioritizing the right things

(07:41):
for the business?
Do you think about how they'reusing their capital if they're
investing in things that aregonna be productive in the long
run, kind of durable for thebusiness?
How do they treat theiremployees?
Do they have heightenedturnover because they're
mistreating employees,underpaying them, losing them to
competitors?
How are they dealing with theirregulators, with their
community?
Are there any kind of risksbuilding up right, let's say,

(08:02):
around regulation?
You know things that they'renot doing.
Well, nobody would say no tothose things.
All of these things are againpart and parcel to how we
consider investment.
I think there was some clevermarketing right A number of
years ago to say, like you know,you put some of those things
together and you know ESGappears.
I think there was a confluenceright, confluence of a situation

(08:25):
where energy markets wereunderperforming and large cap
growth type stocks, especiallyin the US, were outperforming.
We're talking aboutdiscretionary and comms and
technology and stocks thatgenerally have a lower carbon
footprint and they're going toperform different.
It's a new economy versus sortof the old economy.
You know energy, materials,industrials, and so you have

(08:48):
this kind of, again confluenceof really good performance for
large cap growth and new economytype names that correlated in a
way with kind of being moreenvironmentally friendly in
their business model and alsokind of, you know, having a very
highly compensated, diverseworkforce and also having, you
know, pretty good governanceright and a lot of staff on hand

(09:10):
to write policies and respondto questionnaires and get really
good ESG ratings, and so that'skind of I think how it got very
big is, you know, whensomething performs very well.
You know people look for areason and this was kind of you
know it was like asustainability.
But I think again, it wasprobably much more of kind of
market drivers that were doingthat, and if you look at market

(09:30):
factors like growth, for example, I think there's a lot of
explanatory value there.
And I think what people reallyweren't prepared for is the
other side of that coin, right,and that started obviously in
2022 when Russia invaded theUkraine and oil prices spiked
and all of a sudden, what seemedto be like just forever better
performance wasn't, and thenpeople started to sort of have

(09:52):
these reservations or ask thesequestions.
I think now that we're here,we've been through that kind of
both parts of that experience.
It's important, moving forward,to sort of redefine what it is
that we mean by sustainability.
I certainly have some thoughtson that so we can talk about it.
But you know, you redefine thatand you sort of say what is it
that we're really investing inagain, from an investment

(10:13):
discipline standpoint, and whydo I think it's going to work
and over what time horizon, andreally make sure that investors
understand what they're buying.
I think, like anything else,when there's a bit of a bubble
and there's a lot of excitementand enthusiasm, and everybody
seems to be doing it.
you sometimes sort of lose alittle bit of the detail you
know, or you lose the you know,the kind of what you really

(10:34):
needed to understand at the coreof it, and so this gives us a
good opportunity, I think,moving forward to do that.

Speaker 2 (10:40):
So a couple of things that come to mind.
First of all, like I like whatyou said, that these things have
always been there.
It's just that maybe in thepast few years we got better at
putting names and words andreally explaining what it is,
but a lot of sustainabilityconsiderations were already in
place by investors, despitemaybe not having formal

(11:03):
frameworks and so on.
And I guess also you touchedupon the point of marketing.
I think we need to talk aboutthis at some point, because some
people have argued that there'sa lot of marketing involved
when it comes to sustainabilityvalue propositions.
And of course, the famous wordsof greenwashing and things like

(11:24):
that come to mind.
Can you share your view of?
Yeah.
For those that are a little bitskeptical about sustainable
investments and that believeit's pure marketing, what would
you tell them?
What would you tell them?
Is greenwashing a real thing ornot, and is there real value in

(11:46):
sustainability-awareinvestments?
Let's put it that way yeah.

Speaker 1 (11:54):
I mean there's definitely greenwashing, there's
impact washing, there's allmanner of washing.
That's kind of how human beingsoperate, right, when they see
opportunity sometimes.
But what I would go back to,right, if somebody is asking the
question about the kind ofveracity of sustainability,
investing, right, the validityof it over time is, I would just
again kind of go through somedefinitions.
You had mentioned that you know, in the last decade, right,

(12:16):
this has become a really bigtalking point, but obviously
there was always not always, butmany years ago there have been
investors who have investedalongside their own values.
Right, so they were investors,I mean kind of in the old days.
Right, it's sort of SRI, sosocially responsible investing.
For example, you'd haveinvestors who might be religious

(12:38):
institutions or kind of otherethics-based investors, right,
who would say there are certainthings I can't have in a
portfolio, so the exclusionarymindset around saying you know,
I don't want to have tobacco oralcohol or other kind of sin
stocks, for example.
You know I have a fundamentalproblem with these and you know,
I know that I may lose out onsome performance.
You know tobacco stocks didn'thave a very good yield, for

(12:58):
example.
You know I may lose out on someperformance.
But that's okay for me, becausemy objectives here are not just
performance but also, again,reflecting my values and what I
do.
Those investors still exist.
Right, we have those types ofyou know again, mission-driven
investors or ethics-driveninvestors.
You know we have endowments andfoundations and some family
wealth right, and now you knowyou've had something of an

(13:19):
evolution into impact investingright In that area where there's
a range anything fromphilanthropy, which is sort of
fully right, kind of not returnsfocused, to a more sort of
alpha-driven impact investingthat combines, right, we're
trying to do well, we're tryingto have good alpha by sort of
investing in companies that areproviding solutions to large

(13:39):
social and economic problems.

Speaker 2 (13:41):
Just one comment there, like for those not
familiar with impact investingwhat is it exactly?

Speaker 1 (13:46):
Yeah.
So I will define impact versussustainability as what a company
does versus how a company doesit.
So how a company does things issustainably right or
non-sustainably.
So you say, how do they?
Again, what is their governancelike?
How do they think aboutenvironmental you know, physical
and transition risks andclimate?

(14:07):
Again, how are they doing humancapital management within their
organization?
How will they do what they do?
But what a company does for aliving can be impact.
And so if a company, forexample, is building affordable
housing right for, you know, forfolks who have lower income, so
it's creating, you know, somesort of housing, right for, you
know, for folks who have lowerincome, so it's creating, you
know, some sort of impact,education, financial inclusion,

(14:31):
let's say, a company thatprovides a bank, that provides
small loans to femaleentrepreneurs in emerging
markets right, allowing them tosort of get their families onto,
you know, kind of into, kind ofa better financial situation,
so that's what a company does.
And impact has to happen at thecompany level, but also at the
investor level.
So what you have to be able tosay is I've invested in this

(14:52):
bank that is making these smallloans, and if I hadn't given
money, if I hadn't made thatinvestment, they wouldn't be
able to do as much as they'redoing now with my capital.
So they're having an impact on,let's say, these women or
minorities.
Right, you know who are gettingthese small loans, and it's
because I funded this investmentthat more of these people.
And then you have a KPI aroundhow many people have been

(15:14):
impacted, right, how manychildren have been educated, how
many homes have been built, howmany people have received loans
for small businesses.
So it's really measurable.
And again, the argument can bethat that bank that makes these
small loans can actually bereally profitable, because these
women do really well andthey're very rigorous about
repaying their loans, and so itisn't charity Impact.

(15:35):
Investing can very much bemaking money, profiting and
having alpha from something thatis improving both either
environment or society.

Speaker 2 (15:44):
So that's impact.
I have a question about that,sorry, because that's a super
interesting point.
I'm curious to hear your answerwhen people ask you when you
make sustainable investments,are you delivering higher
returns, or is it similarreturns, but which are also good
for the planet?
What's the pitch?

Speaker 1 (16:04):
Yeah, on the impact side, we try to deliver
market-like returns, right, soyou're not necessarily kind of
leaning into like much morealpha, but let's think about it
this way this is kind of myfavorite, like recent way to
talk about this, and this is nowon impact, so we'll go back to
sustainability in a moment,right.

Speaker 2 (16:20):
We want the juicy details.
Marina, Bring it on.

Speaker 1 (16:25):
The juicy details on the impact side.
Right, what I think you'resaying for impact, if you're
going to sort of make alpha outof impact and we actually have a
paper coming out just thiscoming Monday, like right after
this recording is being donewith the Saeed School of
Business at Oxford UniversityWe've written a joint paper on
kind of impact and alpha to youknow that can be delivered from

(16:47):
public markets.
So it's because you'reidentifying companies that not
only are thriving in a future ofchange but they're actually
creating goods and services thathelp others thrive.
And so, intuitively right,those companies should have a
tailwind over time, rightthey're, you know, because

(17:07):
they're providing solutionseffectively to, kind of again,
social and economic problemsthat you know society is trying
to advance, trying to, you know,resolve.
So, again, I think we don't wantto overpromise.
You know our impact portfoliosdo focus on choosing great
companies that are going to bereally successful with the
business model that they haveand that business model is
driven by this.

(17:28):
Need you know, again, whetherit's financial inclusion,
education, you know, medicine,whatever it is right, that needs
to be provided that again isgoing to have a positive impact.
But we tend to sort of say it'sa combination of the return and
the impact and you're trying todeliver at least a market-like
return and not give anything upand at the same time be

(17:49):
providing that impact.
So, going back.
Oh sorry, Go ahead.

Speaker 2 (17:53):
Go ahead?
No, I was going to say if itprovides returns similar to the
rest of the market, but with apositive impact, why is not
everyone doing this?
Hey there, quick favor to askIf you enjoy the blunt dollar,
the unfiltered takes, thestories and the laughs.
The easiest way to support theshow is by tapping that

(18:13):
subscribe button right now,while you're listening.
And here's my promise If you do, I'll keep bringing you honest
conversations, freshperspectives and the kind of
finance talk that's engaging,insightful and worth your time.
Thanks so much for being hereand let's keep these great
finance conversations going.

Speaker 1 (18:34):
Yeah, well, I mean, I think that it's still a fairly
nascent space on the sort ofpublic market side, right.
So listed markets equity isstill quite nascent we're only
just building a capabilityaround it, and so are others
have been less than marketreturn driven.
They've been like blendedfinance, where you have, you

(19:02):
know, partly is that money'scoming from the public sector,
right, and then you have kind ofprivate investors coming in as
well.
So I think it's just thedevelopment of that market.
And the other thing is youcan't guarantee like you can't
with any active investing rightthat you're always going to
outperform.
And you also have to thinkabout time horizons.
A lot of times investors arefairly short-sighted not all of
them, but they're kind oflooking for, you know,
outperformance every quarter,every year, and that's not
something that's sort offeasible to always deliver.

(19:22):
So you have to have a sense ofwhat that your sort of theory of
change right is what drivesimpact investing, where you say
that over time, this is the kindof change that we're going to
see, and it may be a multi-yearsort of horizon right over which
somebody has to have a bit ofpatience to see that value

(19:42):
delivered.
So I think that's the kind ofthe broad answer.
But, as I said, we've beentalking a lot about impact,
which is exciting to talk about,but it's very small kind of
niche still in the area ofsustainability and actually a
lot of times it's good thatwe're having this conversation
because people misunderstandthat all of sustainability is
impact and it's not right.
If you think about co-centriccircles, the biggest of the
circles is sort of ESGintegration or sustainability

(20:04):
integration, which is justconsidering the risks and
opportunities and engagingactively with companies.
If you think about the nextsmaller circle within that big
co-centric circle, it's actuallysaying I have some sort of
sustainability objective.
I would like my portfolio overthe next X number of years to
begin to decarbonize, to have alower carbon footprint, for

(20:25):
example.
That's my objective and that'sadditional to just returns and
risk.
And then the smallest of theco-centric circles, in the very,
very center, is the one we justtalked about, which is impact.
So not only do I want aportfolio to have a specific
objective, but I need it to bereally measurable so that I can
actually identify again whereI've had an impact, where the

(20:46):
companies I'm invested in andwhere I have had an impact as an
investor.
So that's a very rigorous sortof thing.
That impact piece, the biggestof the co-centric circles, I
would suggest, should be thesame size as the broader market.
That you know.
Anybody who's investing rightshould be thinking about how the

(21:06):
world is changing.
That's the first thinginvestors think about, right?
What does the future look like?
So what are the changes thatare coming?
I mean, some of those changesare, of course, political right,
geopolitical right Look, we'vejust had the tariffs put in
place, right?
Things change every day and soinvestors are always trying to
be prepared for that change inportfolios.
But some of those changes, nomatter how skeptical somebody

(21:28):
might be overall aboutsustainability, they have to
admit that some of those changesare environmental and social in
nature.
We are seeing, you know,climate disasters on a you know,
more frequently and at largerscale than ever before.
We are seeing, obviously, animpact to insurance coverage
around that.
There's obviously some regionswhere there is very little

(21:49):
insurance covered to begin with,but in developed markets,
insurers sort of processingright, what does it mean to have
this heightened risk?
So, you know, companies are atrisk from these environmental
disasters.
They're also at risk fromtransition risk, the potential
that traditional energy is goingto be more expensive going
forward.
And then they're also at riskfrom all the regulation right
from different regions that istrying to shift us right over

(22:13):
time from molecules to electrons.
And then, of course, you know,clean energy is also, just from
an economic standpoint, becomingsort of more, more again
economic for for buyers.
So that's, those changes areenvironmental.
And then there's social change,right Again, no matter how
skeptical you are, you can seethat there is demographic shifts
.
There are migrations, right,migration is taking place, some

(22:33):
of it related actually toclimate, you know.
You see aging populations.
You see aging populations.
You see more kind of urbanizingpopulations, wealthier
populations, you know.
You see the labor marketsshifting, right.
So there's definitely kind ofdemographic social change and,
again, regulation around that.
What we as a society findacceptable, let's say in terms
of labor right Considerations,you know, human rights, right In

(22:58):
supply chains or kind of humanrights generally, globally,
right.
So, like as a company, you'redealing with those changes in
the future.
So that's what I thinksustainability is.
I'm going to pause just for asecond.
So it's really really likeclear Sustainability is
investing in assets that aregoing to be able to thrive in

(23:19):
the future change that happens,instead of being at risk from
change or hurt by change.
So when I ask a company, do youhave a transition plan in terms
of your energy use, right Fromtraditional to renewable, I'm
not asking it, like you know,because I, like I believe in
renewables, right Like.
That's not the point, it's notlike a value system.

(23:41):
I'm asking the company do youhave a transition plan?
Because if a company doesn'thave a transition plan, that
presents a risk to them becauseof cost right, those costs are
going to go up.
It presents a risk to them froma regulatory standpoint and it
presents a risk to them from theperspective of kind of a
network effect, because they areno doubt a component of a

(24:02):
supply chain for another biggercompany that is transitioning
and so if they don't transitionover time, the bigger company is
going to see that problem intheir supply chain and probably
replace them with a competitor,right?
So I'm asking that questionbecause I'm saying this is the
kind of change that's coming.
Are you going to thrive in thischange or is this change going

(24:22):
to hurt you, disrupt yourbusiness?
Are you at risk from thischange?
And I ask the same question,let's say on human capital right
, are you paying your employeesa fair wage?
Are you retaining your staff?
I'm not asking just because Icare about labor.
I care, but the reason I'masking is if the company is in a
competitive space where theycan't retain talent, then over
time that is really going to bea risk to the business.

(24:43):
That's why I'm asking there'schange in, let's say, the kind
of labor space in your space.
Are you prepared for thatchange or preparing for that
change?
Are you going to thrive in thatenvironment and beat out your
competitors, or are you going tobe at risk from that change?
Are you going to thrive in thatenvironment and beat out your
competitors, or are you going tobe at risk from that change?
Are you going to be hurt bythat change?
So that's it.
It's basically investing incompanies that are going to be
able to tolerate or do well inchange, and some of that change,

(25:07):
a lot of that change isenvironmental and social.
So all of a sudden it looksdifferent.
That sustainability ininvesting is just the ability to
ensure that you are includingall of those considerations as
an investor alongside the otherconsiderations that you include,
which could be, again, you knowaround.
You know market movements andmarket drivers, geopolitics, all

(25:29):
these sorts of things, right.
So, it's part and parcel, and atsome point you were talking

(25:56):
about timeframes.
So I'm curious to hear can youinvest sustainability over the
short term or is this inherentlya long term kind of investment?
That's the other word,integration of sustainability,
risks and opportunities in theshort run.
Let's say that one of thethings that you're doing is
you're looking for potentialcontroversies and you're trying
to avoid controversies.
Right, that could be ashort-term thing.
Controversies can come up on ashort run and somebody could be

(26:17):
at risk from those.
So I think, again, it's aquestion of how we frame it.
If you're running a let's sayit's an emerging markets equity
portfolio, and you're running avery diversified emerging market
equities portfolio and you'rean active manager, so you've
obviously built a concentratedinvestment portfolio of stocks
in emerging markets and you'vedone rigorous analysis of both

(26:38):
the you know, regular kind offinancial and then these
additional right kind oflong-term investment
considerations, some of whichare environmental and social in
nature.
So you're fully, sustainablyintegrated analysis.
Then you invest in thosecompanies and you engage with
them, right, so you meet withthe companies.
You say look, I've got a60-stock portfolio're one of

(26:58):
those stocks.
Here's some concerns that Ihave.
Let's talk about how you'repreparing for the future, all
those things right.
I think in the short run thatportfolio can outperform the
market.
There's no reason for it not to.
I think what happens if you havea portfolio again that isn't
just sustainably integrated buthas some other objectives.

(27:21):
So, let's say, you're doingemerging markets investing, but
you want it to be low carbon,right.
So you're looking for companiesin emerging markets that are
either are already kind of lowcarbon or they are, let's say,
providing climate solutions,right, maybe companies that are
actually developing, you know,clean technology in emerging
markets.
There is going to be a chancethat that portfolio
underperforms the broaderemerging market because there
may be, obviously, you know,like sort of cycles where you

(27:45):
know, like energy markets areoutperforming and so you
underperform.
And I think that you just haveto make sure that your investors
understand that you'veintroduced a certain kind of
bias into the portfolio, thatsometimes you know it may not
work, but that you've introduceda certain kind of bias into the
portfolio, that sometimes youknow it may not work, but that
you believe in the long run,given the long-term trend of
decarbonization, is going towork right.

(28:05):
So those are two reallydifferent things, kind of
delivering a kind of regularemerging market equity exposure
where you feel like you'vereally done very good
fundamental analysis thatincludes sustainability versus
you are delivering a certainkind of exposure in emerging
markets that is thematic innature and that theme, even

(28:26):
though you believe in it longterm, may have peaks and valleys
.

Speaker 2 (28:32):
Okay, that's interesting.
So, yeah, clearly a type ofinvestment strategy that really
is applicable or at least opento any single investor in some
shape or form.
I want to come back tosomething you said before about
impact investing, when you saidthat a lot of people confuse

(28:55):
impact investing withsustainability overall.
What do you think is thebiggest misconception about ESG
investing today?
Would that be it, or do youthink there are others?

Speaker 1 (29:07):
I think that's it.
I think that what happened isthat we as an industry, as
investors, we're notsufficiently clear and distinct
about these categories.
Right, you know we'reintegrating sustainability
considerations.
And then you know you obviouslyhave two sides to this sort of
story.
Right, you have a backlash thatwe're aware of in sort of
different markets that'spolitical in nature in some

(29:30):
cases, and you know it's easy tosort of say that somebody is
just taking their values andimposing them on a portfolio.
I talked about way back, thekind of exclusionary approach
where you remove certain thingsfrom a portfolio because you
don't want to be invested inthem on, let's say, ethical
grounds.
That isn't what we are doing,kind of in the modern, you know,

(29:53):
understanding, right, sosustainability integration, but
because we didn't draw thesedistinctions and it was much
easier to say, don't worry, it'ssustainable, you know, and then
maybe charge a bit more for it,which again is like, definitely
not what's going on goingforward, but charge a bit more
for it and have like some snazzyand kind of slick marketing, I

(30:13):
think that we left a gap or weleft.
Basically we left ourselvesvulnerable to somebody
criticizing this, especiallywhen underperformance began, and
saying you see, like they'vesold you a bill of goods, right,
they said this was always goingto work and it's not working.
And they've been againpromulgating their value system

(30:35):
instead of just managing yourmoney and trying to deliver you
the best alpha.
And so it's really important todecouple.
That's why I said atSchroeder's that all of our AUM,
literally all of our AUM itlooks at the risks and
opportunities.
That's it.
That's all it does.
It doesn't mean that they're thedrivers of the portfolio.
It just means that if a PM iswalking away like he's finished

(30:56):
for the day, right, he's turningoff his computer and you say
have you considered all of thepotential risks and
opportunities?
Right, here you're invested ina company that has facilities
that are located in coastalareas.
Have you thought about, youknow, like, you know the
environmental risks?
Right, to flooding, let's sayno, I haven't, I haven't thought

(31:17):
about that.
Why not?
Right, like well.
Because to flooding, let's sayno, I haven't, I haven't thought
about that.
Why not?
Right, like well.
Because you know some peopledon't like that E thing?
Right, well, that's ridiculous.
Right, it's a fundamental risk,so you should be thinking about
it.
So that part, I think, is thatwe consider that to be across
our entire business, a trilliondollars in assets that there
isn't any asset class thatshould be sort of exempt from
considering all the risks andopportunities, but only $120

(31:40):
billion of a trillion so alittle bit over a tenth right
has a sustainable objective andthe investors who are coming
into those funds understand thatthat's the objective that they
have, that they're trying toachieve something specific and
then about $5 billion we hopeit'll grow, but it's about $5
billion of investment that isimpact-oriented, where investors

(32:02):
not only have a certainobjective they're trying to
achieve with that money butthey're willing to put a lot of
structure around that.
As I said, where you're lookingfor companies that have
measurable change intentionalityaround that, like it's I intend
this, my investments are makingthis additional.
It's additionality, additionalimpact and these companies are

(32:25):
measurably providing whateverthese services are to this many
people in this community, etcetera.
Again, that is not foreverybody.
It's out of a trillion dollars,it's 5 billion.
We hope it grows.
But it's a very differentapproach than this kind of
regular PM on any investmentdesk who just needs to walk away
saying I have done a full job,a thorough job, of understanding

(32:47):
the governance right, how thecompany is run how the company
deals with again sort of thehuman element of its business
and how the company isaddressing the future transition
and physical risks of climatefor its business.
Those two things are reallydifferent.

Speaker 2 (33:04):
You briefly touched upon the backlash and I think we
should dig a little bit deeperthere.
So we saw a few years of superrapid growth on the ESG space,
of super rapid growth on the ESGspace, and now, more recently,
we've seen increased skepticism,to put it some way.
So two questions One, what isbehind all this backlash in your

(33:29):
opinion?
And two, do you think this is anecessary reset after some
crazy year where everyone andtheir grandma were talking about
ESG all the time?
Or is this really a risk forsustainability over the long
term and things are about tochange and maybe become less
popular as an investment?

Speaker 1 (33:50):
theme.
So I think it is a necessaryreset.
I think, for example, we'reseeing today in Europe, right,
where there's been a lot ofregulation that's been proposed
and now there's a bit of areassessment of the cost of some
of that regulation to sort ofcompetitiveness in the market.

(34:12):
That's a conversation thatalways has to take place between
the public sector, the kind ofregulatory and policy framework
and the markets.
Right To say, the burden ofregulation has to be
proportionate and has to sort ofcreate good right.
So you know, we I mean you knowhave regulated things like not
allowing, you know, child labor.
Now there's regulation rightaround kind of deforestation,

(34:34):
for example.
You know, certainly someprofits are lost because of it,
but clearly society says thatthese are profits that in the
long run would have hurt, right,you know, globally would have
hurt us, and so regulation isappropriate there.
And so that dynamic, thatdiscussion, right, I think that
there was just again years ofenthusiasm, even on the
regulatory front, and nowthere's kind of a bit of a

(34:56):
consolidation or a pause takingplace where we're sort of
reassessing what isproportionate, what is
appropriate From an investmentperspective.
On the backlash, so we didn'tsay it, but I came into the role
in 2022.
The first thing that I did whenI sort of came into my current
role is I wrote a paper that'scalled ESG Through a US Lens.

(35:17):
Current role is I wrote a paperthat's called ESG Through a US
Lens and I talked about some ofwhat I saw as concerns and this
is before Russia invaded theUkraine, so they hadn't
manifested yet.
You didn't have the backlashyet.
Politically, it was kind of thevery beginning of the year 2022.
And one of the concerns that Isaw was that we needed to
address folks who were hesitant,to address folks who were

(35:42):
hesitant.
Right, about transitions, aboutchange, with more respect and
empathy.
So change is very difficult.
When you say it's inevitablethat we're decarbonizing our
economies, that is true, butthat hurts someone, right,
there's going to be somebody whoworks in the fossil fuel
industry.
There are communities relianton coal, reliant on oil.
You know state like taxrevenues, right, they're reliant
on those industries.

(36:02):
You just have to be empathetic.
You have to be respectful ofthe fact that change, even if
you're right, you're pointingout the change is going to
happen and you have to beprepared for it, that that
change is difficult and it canbe financially difficult in the
short run for folks, and youknow like not everybody is

(36:22):
comfortable with change, and soif you sort of don't account for
that, if you don't acknowledgethat, then you build up.
For you know people around youwho may be quite resentful.
And you've been successful,right.
What you're doing, theinvestment side, is performing
really well, and so you keepsaying this and they can't
really touch you because theperformance is so good.

(36:43):
But when the performance turns,as inevitably it does and it
did right, because of marketcycles, then the people who were
resentful have everyopportunity to point out that
you were wrong the whole timeand that the whole time you were
really kind of disrespectfuland not empathetic to kind of
their concerns.
That's, I think, where we are,and I think we'd be smart to

(37:03):
avoid that, going forward and tohave conversations.
We talk now about justtransition.
You know how can we affect atransition that does take into
consideration the folks who losefrom that transition?
You're talking about reskilling, training, you know, finding
kind of new avenues for work, Imean all those sorts of things
for people, employees, community, right.
So I think, just a differentapproach to it's maybe, yes,

(37:26):
maybe these environmental andsocial changes are inevitable,
but that doesn't mean thatthey're painless and it doesn't
mean that we should discountagain that kind of respected
empathy.
And I said a number of otherthings in that paper too, but
that was the big one and I thinkthat that, ultimately, is what
has fed a lot of the certainlypolitical backlash, right.
I think that we also need tosort of again understand as

(37:48):
investors, we need to sort ofarticulate over and over again
that we want companies to besuccessful, we want them to
successfully transition.
We're investing in companiesbecause we want them to succeed,
right.
And so when we engage withcompanies and we ask them
sometimes the tough questions,right, about their climate
transition or about their again,their human capital practices,
the reason we're askingsometimes it's like a little bit

(38:09):
of tough love You're a criticalfriend, but you're a friend
still.
You're asking because you wantthem to be thinking about these
things and to succeed in thefuture.
And so some of the backlash hasbeen on the kind of basis of,
like, the politicians sayingwe're going to defend the
company from its ownshareholders, right, that
dynamic that is kind ofincumbent on the shareholders

(38:36):
and the company, you know tohave a better way to come
together but to articulate thatwe have the interests of the
company at heart, right, that asa shareholder, you want it to
be successful, and so Shreddershas done a lot, I would say, on
the active ownership front it'salso called stewardship or
engagement to really kind ofsend that message.
Right that we come to the tablewith this sort of spirit of we

(38:56):
want to see you succeed.
Right, that we come to thetable with this sort of spirit
of we want to see you succeed.
And when we're engaging, forexample, with large fossil fuel
companies, right, companies thatcurrently, you know, produce
oil and gas, we are veryconscious that many of these
companies are going to be thesource of success for
decarbonization.
Many of them are investingheavily their future capex right

(39:18):
into hydrogen you know, greenhydrogen into battery storage,
right into renewables.
They have the money, they havethe resources, they have the
technical know-how.
They're absolutely part of aglobal solution and not, like
you know, a problem that youhave to set aside or sort of
right.
So that I think these kinds ofmessages are really important to

(39:41):
ensure that you don't have thisvacuum that you create right,
where a political message canthen develop that either, you
know, companies need to beprotected from their own
shareholders, or that moneymanagers are sort of taking, you
know, the beneficiary right,the kind of money of the
investee, the end investor, andusing it for some goal other

(40:06):
than what is best for thatinvestor, right?
We don't want those narrativesto have sort of fuel and that's
why we have to explain ourselvesbetter that ultimately what
we're doing is what's best forthe client.
That's our objective, and so formost of our clients we're
delivering again, sort of we'relooking to deliver I have to be
careful great long-term returns,and that includes assessing

(40:28):
risk and opportunity aroundsustainability as well.
There's a subset of our clients,as I said, who have come to us
specifically for sustainableobjectives, impact objectives.
We are delivering to thoseclients what they have asked for
right as well as we possiblycan.
But what we're not doing rightis we're not sort of using
someone else's capital topromulgate our value system or

(40:50):
kind of what we believe in.
And I think that that, like Isaid, that narrative in the
market, it doesn't come fromnowhere.
It comes from that sort ofresentful place right when there
were years where the you knowasset management community, I
think, was not sufficientlyempathetic to the fact that
change is difficult, that it's,you know, like push and pull,
that it's like stop and startright, two steps forward, one

(41:13):
step back, those sorts of thingsand that you have to account
for people who are damaged bychange and you have to think
about them too.

Speaker 2 (41:21):
I want to take a step back now and look at ESG, but
from the data point of view.
So there's something called theratings, the ESG ratings, and
there's been, of course, hugeproviders that have emerged over
the past few years and on whichinvestors have relied to make

(41:43):
their investment decisions.
But the problem is that theseratings diverge sometimes from
one provider to another.
So why do you think theseratings are so inconsistent
between one provider to another?
What's the issue here?
Hey there, quick ad break.
Do you work in the financeindustry and have a genuinely

(42:06):
interesting story to share?
I'm always on the hunt forgreat guests who bring raw,
unfiltered insights to the table.
Or maybe you know someone witha story worth telling?
Please put us in touch.
You can reach out to medirectly via LinkedIn.
I'd love to hear from you.
And now back to the show.

Speaker 1 (42:28):
Yeah, I think and I want to be careful because I
have friends, you know, at MSCIand Bloomberg and all these
places, right.
So but, I think that to the endof the day, they are measuring
sometimes different things right.
A lot of it is a bit black boxbecause you don't know exactly
what the model is underneath andhow things are weighted, the
correlations between sort ofdifferent you know companies and

(42:51):
their ratings are fairly low,like something you wouldn't
tolerate, let's say, in creditratings, right here.
You see that and it's been afairly unregulated space that is
changing, I would say theregulators are looking at the
rating agencies and trying tosort of come to some more
formality right about what it isthat they're doing and
providing, especially since theybecome so important to so many

(43:12):
investors' perception of themarket right, where they're
looking for that sort of score,the number of globes right, the
number of stars.
I think that we have, as aninvestor, just approached it
from proprietary analysisperspective.
We do look at ratings becausewe want to know, kind of, how
our clients might perceive afund and just to compare a
little bit.
But at the end of the day, weare doing our own analysis.

(43:33):
We have proprietary models thatare measuring the things that
we think are material, thethings that we think we can put
a price on.
So we do one model where wehave kind of externalities that
are created by businesses.
So there might be environmentalor kind of social externalities
.
So you can think about tobaccoas an easy one.

(43:53):
You know produces disease,right, Disease is costly.
Who's paying for that disease?
Right, who's paying for thoseillnesses?
And you know, does society sayto the tobacco company?
And of course society has saidto the tobacco company you're
going to pay for these diseases,right, we're going to sue you
or we're going to regulate you,there's going to be new
legislation and you're going tobe responsible.
And you can think aboutsomething similar for an alcohol

(44:15):
company, for a sugar company.
You know, food and beverage,obesity, what's the cost of
obesity to society?
And should the companies thatare basically driving, you know,
through sugar, more obesity andmore heart disease and all
those things, be responsible forthat?
So that's one way that wemeasure kind of risk to
companies is, you know, arethere negative externalities?
And of course some of them areenvironmental, right, so carbon,

(44:37):
and what would the cost of thatexternality be to a company?
Then we look at stakeholdermapping, we look at thematic
alignment.
You know we have lots ofdifferent ways to sort of
measure risk in a portfolio andopportunity in a portfolio, an
opportunity in a portfolio, andwe do it ourselves.
We have over a dozen differenttools that we've spent over a
decade building.
Because of this reason, kind ofwhat you're saying, right, is

(44:59):
that if you're just looking atthe rating, you have to do quite
a lot of work under the hood,which is usually not available
to you, right, in terms of kindof the data underneath, to
understand what it is that'sbeing rated.
Ratings are also very backwardlooking and the thing about I
think I keep saying the wordchange change is the most
important thing for investors,right.
So the thing about sort of acompany that, let's say, may

(45:19):
have had a controversy or mayhave, you know, had some
negatives, right, is it may bechanging and improving right on
that front.
So we look at sort of thetrajectory of improvement and a
lot of times the ratings aregoing to be backward looking and
they're not going to beadjusted sort of in real time,
and so you may have some poorratings for companies that
actually are some of the lessrisky ones because they've gone

(45:42):
through a bad period and theyhave made changes that are going
to make them sort of moredurable.
So I think there's, yeah, andit's the lack of transparency
and the kind of backward lookingnature of it, and you know, the
fact that everybody has aslightly different model because
that's what they've decided iskind of the appropriate thing,
but that's what they've decided,right.
And so, as active managers, asfundamental investors, we've

(46:04):
taken the approach of sayingwe'll take raw data.
We love to have raw data fromcompanies themselves, but
sometimes you need to have sortof estimated data and you can
get that from some of the bigproviders.
So we'll take the data.
But then ultimately, we want todecide how we assess, you know,
risk and opportunity.
And, by the way, we show thatto our clients.
We have papers around our ownmethodology.
We actually open the black box.

(46:24):
We say this is exactly how wedo it, because we want our
clients to be comfortable, thatthey agree, and if they don't
agree, that we can have a debatearound it.
But this is how.
And even then we don't use asingle score.
We think of it as an input intoa broader analysis.
Right, it's just a way tounderstand what risk you may
have and also to engage withcompanies around it.
That's the other thing I wouldsay is I think you know if

(46:46):
somebody is using the rating,but they're kind of taking it
with a bit of a grain of salt,it's a directional indicator,
let's say.
And then it's a way to sort ofsay, okay, maybe there's
something that I should red flagor maybe there's something that
I should discuss with thecompany, that's, I think, fine.
I think it's just when you takeany one number, whether it's
the third party number from oneof the rating agencies or
whether it's our sort of number,if you take a single number

(47:08):
without a grain of salt and it'sgospel.
That's when, I think, you get introuble.

Speaker 2 (47:12):
Yeah, 100% no, and I think maybe it's not necessarily
a bad thing right to have thesedifferent ratings, because they
may put the spotlight ondifferent things and by
combining them you get a morecomprehensive picture.
Another question that looks atESG top-down.
On related topic so I thinkit's undeniable that the finance

(47:38):
industry has been prettymale-dominated for centuries,
unfortunately.
But sustainable finance I thinkit's my impression is one of
the few areas in the financeindustry today where women hold
a significant amount ofleadership positions and it's

(47:59):
less male dominated, to put itsome way the case.
Do you think women are reallyat the forefront of ESG,
investing more in other parts ofthe finance industry, or not at
all?

Speaker 1 (48:21):
It's kind of a dangerous question.
I think I don't mean to benegative, but it's an
interesting one.
There's been, I mean I guessI'll say it right.
Sometimes people talk aboutlike a pink ghetto, the pink
ghetto right, where you sort ofhave women and kind of more
senior leadership, but they'renot like you know, they're not
in roles that are asdecision-making roles or they're

(48:44):
not as like influential rolesright, where you sort of the CEO
will be male and the like CIOwill be male and the COO will be
all the kind of like you know,like those drivers.
And then you'll have, like youknow, somebody in a role like
the head of sustainability right, which doesn't have as much,
doesn't report to the board, forexample, doesn't have as much
sort of influence, and it'salmost like he or his kind of

(49:05):
like a little treat right, andthen you have that kind of
tokenization.
I think there's some element ofthat.
What I don't like, honestly, is,if we still look at the numbers
on the investment side, thenumber of female portfolio
managers driving investmentdecisions, you're still lacking
those numbers of women right.
Again, it's hard to just likefocus specifically on gender,

(49:26):
but there are definitely a lotmore women in corporate
sustainability, right.
So like the corporatesthemselves, decarbonization and
kind of other goals that theyhave.
And again, I think what'sreally important is to look at
how those roles are integratedwithin their organizations.
Again, is it a board levelreporting?
Do they have, you know, thereal kind of budgetary decision

(49:48):
making, like you know what isthe kind of influence of that
role?
Or is it just sort of, you know, virtue signaling or kind of
you know like a figurehead typerole On the financial side?
I mean, I think you're right, Ithink women have gravitated
towards sustainability, part ofthat because it does align with
women's values.
I mean, I don't know.

(50:08):
Again, men are parents too, but,like you know, parents, for
example, will think about theworld they're leaving their
children in the future, like youknow.
I think we're human beings,we're driven by some of our sort
of own you know, like valuesystems and you want to find
meaning in the work that you do.
So that's how I feel and othersfeel, I'm sure, and you know so
you do see a lot of women, Ithink, also in engagement and
stewardship type roles, right,that engagement with companies.

(50:32):
And again, you have to thinkabout whether that is sort of
happening over here in a corneror if it's happening in a real
way, like from an investmentengagement standpoint.
So at Schroeder we're verylucky.
We've built the system in avery investor-focused way.
So almost all of ourengagements take place with the
investment team included and themajority of them actually are

(50:54):
led by the investment team.
They're driven by the investorsand that's what companies
prefer too.
They want to be at the tablewith the portfolio managers who
actually own their assets rightand understand their business
really well.
So I think it's a mixed bag.
I think for every role you kindof have to ask you know what is
the like?
Is it an influential role or isit sort of a performative, you

(51:16):
know situation for a company toput a kind of a you know a
female, you know person in thatspace and kind of say look at
this, right, it goes back to thekind of greenwashing or kind of
slick marketing sort ofquestion too.
It's like there's somediversity, washing, I would say,
in all industries, and this iskind of no exception.
So again, maybe it's not thekind of answer that you want,

(51:39):
you know, but that's kind of myperception of it.
I think that, again, what youwant is really embedding these
decisions in a real way in theinvestment decisions and have
them be influential decisionsand respected types of decisions
, and that's where, okay, youhave more women in those roles
and I'm hugely celebrating thatyou know.

Speaker 2 (51:57):
And how can we do just that?
How can we bring more diversityinto finance?
In your opinion, what's the key?

Speaker 1 (52:05):
Goodness, I mean, that's a really big one, right.
I mean I think that you know,educational achievement, right
for women is certainly on therise, you know, women are
gaining the degrees, they'recoming into the entry-level
roles in finance, as everywhereelse, I think finance from kind
of a we have to market ourselvesa little bit better sometimes,
you know, women can be young,women can be put off, you know,

(52:27):
from finance because they don'tunderstand that there's many
different roles available, sometechnical, some less technical
right.
I think that obviously,education system for kind of
STEM right or STEAM, but morescience and math and technical
education, you know, kind ofgeared at women, has been
succeeding and so you want tosend that message right, there's
these opportunities availableto women.

(52:47):
I think that, like I said atthe starting place, right early
in the career, you do have a lotmore gender parity and then
over time you lose women fromthe industry because you're not
sort of creating, like as theirlife cycle continues, I think,
enough flexibility for them tobe able to build their lives,
their families and also to kindof, you know, build their

(53:08):
careers.
Unfortunately, I think it'sstill the case.
So Schroeder's is actually, as ahouse, is incredibly focused on
, you know, inclusiveness.
It's been focused onflexibility.
We have a flexible workingcharter and you know we've, you
know, increased, you know, bothmaternal and paternal leave and
you know, family leave ingeneral and have, you know,

(53:30):
tried to work really hard toagain retain those talented
women that we have from thebeginning to kind of, you know,
give them role models andmentors and sort of, you know,
make sure they're growingthrough the organization.
And it's hard work.
I mean we're definitely at over40% I think now in terms of
women in fairly senior roles andthen kind of well over 30% in

(53:50):
some of the kind of key rolesacross the organization being
women.
We actually just published ourlast sort of diversity, you know
, annual reporting in the UK,but it's, yeah, it's no small
thing, you know, to be able tokind of evolve the industry to
support women over time and thatgoes, I think, for all
diversity.
Again, we focus on diversity ofthought, diversity of

(54:11):
background.
You know having really kind ofteams at the table that kind of
look different, think differentfrom one another, are kind of
going to make better broaddecisions, because they're not
all sort of thinking in one wayand gender is just one, you know
, kind of one part of that orsort of one of the dynamics
within that.
But, yeah, I think it's seeingrole models, right.

(54:31):
It's seeing other women whohave kind of made it through to
senior roles.
How did they achieve that?
And then having organizationsthat provide that kind of
flexibility and support to dothat.
So I think it's easy to do therecruiting right, but it's much
harder to do this sort oflong-term work of retention.
And, by the way, look, if I canbring it back to sustainability
, when we're looking atcompanies, our investee
companies, these are the kindsof questions that you would ask

(54:54):
them too and you would tie itback to financial materiality.
Right, the companies who can dothis successfully and retain
these talented people are goingto succeed better over time.
So, as an investor, you have aninterest in that.

Speaker 2 (55:08):
And going back to woman.
So you clearly made it to theeyes of many of us.
You know heading thesustainability offering of a
huge asset manager.

Speaker 1 (55:30):
If you could give one piece of advice, particularly
to woman entering the financeindustry today to go as far as
you did, what would it be?
Yeah, I think you have to buildlike an incredible sort of
support system around you.
I mean, I think that that'swhen I was in business school
and I was doing my MBA.
I heard this from a CEO.
A female CEO came to speak tous and she said, you know, like
the most important decisionyou're going to make probably is
the partner that you choose inyour life, right, your spouse,

(55:51):
your partner.
You know, making sure that youguys are sort of, you know,
sharing the burden of the sortof domestic work it's also a joy
, domestic work, but it'sobviously also the
responsibility.
So, building, I think, thatsupport system right for
yourself and thinking in thatkind of long term way like how
am I going to go through thecycles of my life?
You know, sheryl Sandberg,years ago, talked about the kind

(56:13):
of lean-in concept.
Right, when you start early inyour career, like hit hard, you
know, because at that point youdon't have a lot of the
additional responsibilities, andso this is your moment.
I mean, I was an investmentbanker.
I worked ridiculous hours and,like you know, you put in a lot
of work to kind of build yourfoundation, and then you hope

(56:36):
that you built yourself the kindof foundation that when you're
kind of in that middle phase ofyour career where you need some
more flexibility and moresupport around you from both
your organization and yourfamily again your kind of
village right that you can leanon that.
And then as your kids get olderI think not everybody has kids,
you know some people have otherobligations to take care of
their parents or kind ofwhatever it is they need to do
in their life.
Right, as your kids get older,for example, you obviously have
less of that responsibility andso you can lean back in again so

(56:57):
you can have a second or thirdsort of life to your career.
And that's, I think.
Another really good piece ofadvice that I've heard is that
you have much more time than youfeel you do.
You know, I think when you'rein your early 20s, everything
seems like it's like.
You know, it's very likethere's not that long a runway,
right, it's like everything hasto happen right now.
But the reality is the careersare long and they spend decades,
they spend all these sort ofdifferent life, you know, like

(57:20):
sort of stages.
And so just to kind of thinklong term, it's a marathon.
Right To think about it thatway.
But again, to choose the rightteam for your marathon to
support you, because thereinevitably will be very tough
times on the marathon.
I think you know finance, as Isaid.
I mean to me it's a reallyexciting sort of industry to
work in for women, you know it'sobviously lucrative.

(57:42):
It's, you know, can be highprofile.
It's, you know, great sort ofproblem solving and challenges
and intellectually rigorous, allthose things.
If you're a commercial personwho enjoys kind of being with
clients, there's roles for that.
If you're a very technical,quantitative person who enjoys
the analytical side, there'sroles for that.
I mean it's a really broadindustry that allows for many
different skill sets.

(58:02):
And then one thing that peoplequite love about it is it's like
the way that it's judged.
If you're a portfolio manager,you're judged on your
performance, not on what youlook like or your gender or
anything else.
It's like very black and white.
It's like what do you deliver,deliver, and that's actually
great, I think, for women.
So I think it's that initialhurdle of sort of demystifying
the industry and kind of makingwomen feel more welcome into it

(58:24):
and then again supporting themas you go.
But again, for me I would saythat advice is to hit hard in
the beginning, really, reallywork hard, and then think about
that kind of long-term journeyand who's there to support you
on your long-term journey,because you won't be able to do
it alone.

Speaker 2 (58:39):
And maybe for professionals looking to build a
career in ESG, investing beyondjust women, but anyone thinking
about entering the industry.
Apart from that support systemyou were alluding to, and
working hard, what skills do youthink they should be focusing
on in order to be successful inthe field in the next 5, 10, 20

(59:00):
years down the road?

Speaker 1 (59:03):
So, again, sustainability is such a broad
brush right that we have to kindof remind ourselves you're
talking about finance, you'retalking about sustainability in
financial services, becausethere's also kind of, again,
corporate sustainability.
That's the operational side,like you know, if you're working
for one of the corporations andyou're you know like sort of
working on their sustainabilityobjectives, but if you're doing

(59:23):
finance, I think the number onething is to be at heart of a
person who understands themarkets.
I think we have had some ofthose challenges in recent years
where the industry grew soquickly that we didn't have
enough people who sort of knewthe markets and were kind of
investment-oriented, and soother people entered the
industry too from kind of morenon-financial backgrounds, which

(59:46):
is fine and people can learn,and that's what I would
encourage you do if you comeinto that role.
But if you are coming in newinto banking or asset management
or wealth management orwhatever, I would think about
those fundamentals first, thefundamentals of the market right
, and understanding theinvestment sort of discipline,

(01:00:07):
the investment rigor right, theinvestment theses.
At the end of the day, it is notour job in the financial sector
to solve climate change as achallenge, or natural capital,
biodiversity degradation orhuman rights violations.
That is not our remit.
We're not there to solve thoseproblems unless we're working in

(01:00:28):
impact investing, right.
And then you know you'reinvesting companies that are
working on solving thoseproblems, but in general in
finance, it know you'reinvesting companies that are
working on solving thoseproblems, but in general in
finance, it is not your job tosolve that problem.
What your job is is tounderstand the risks that those
challenges present to yourclients' portfolios and those
risks manifest, right, theycrystallize through financial
channels, right.

(01:00:49):
So it's like what is going tobe the financial impact to the
portfolio.
Again, that comes from aregulatory.
You know changes or demand,right, changing demand for goods
and services, right.
So it's always that kind oftranslation right into, again,
those kind of thatcrystallization of those costs
or opportunities.
So I think, starting with theinvestment predicate, right,

(01:01:11):
being an investor first orsomeone who understands the
investment side first is reallyimportant, regardless of the
kind of investing you end upworking in.
Right, so you may end upworking in value or growth, or
you know different asset classes, right, and sustainability,
right, different.
Different, as we said, forms ofsustainability and impact.
Different, as we said, forms ofsustainability and impact.

(01:01:34):
But the fundamental underneathhas to be, I think,
understanding capital markets,understanding the investment
side, and then you build ontothat, whatever your specialty is
.

Speaker 2 (01:01:44):
Yeah, I like that, building some solid fundamentals
and, in order to do that,something that comes to mind, of
course, is certificates and andstudying things like the, the
cfa um oh, which I had to I hadto bring up at some point, uh,
because, uh, the reason whymarina and I are talking today
is because the cfa institutekindly made the introduction.

(01:02:06):
We're both, uh, gonna beassisting the cfa institute
Institute live in Chicago fromthe 4th to the 7th of May.
Marina is going to be one ofthe panelists in one of the
panels that is going to focus onsustainability.
I will 100% make sure to attendthat one because I think it's
going to be a really, reallygood one 1,200 finance

(01:02:29):
professionals and we're going tobe talking about some of the
major topics shaping the financeindustry today.
So if you're curious aboutfinancial markets and enjoy
meeting other people andnetworking, make sure you come
to this event, because it'sgoing to be absolutely fantastic
.
Marina, it's been alsoabsolutely fantastic to have you

(01:02:50):
on the show.
For those of us that want tolearn more about you and your
work and maybe the latest ESGtrends.
Where's the best place we canfollow you?

Speaker 1 (01:03:06):
Oh, ok, I mean, I have a pretty live sort of feed
on LinkedIn where I sort of talkabout all the places where I'll
be.
I do present quite a lot aroundthe country.
The CFA, then, to your point,ignacio, what's really great is
the panel that I'm moderatinghas three CIOs on it, like, not
like sustainability folks, butCIOs, the chief investment
officers of their organizations,and so we're going to be

(01:03:27):
talking about integration ofsustainability from the
perspective of that person,right, who's, again, not a
sustainability specialist, butan investment specialist.
And then I'm also teaching a90-minute workshop on
biodiversity and natural capitaland how to sort of measure risk
around that to portfolios.
So kind of two very differentthings.
So, yeah, so LinkedIn is aplace where I sort of share
where I'm going to be.

(01:03:47):
I also, as I mentioned, therewas the initial paper that I
wrote that was called ESG,through a US lens, you know
which.
For those of us sitting in theUS, I think that's a good place
to revisit, right.
Like what are we kind of?
How are we rebuilding, you know, sort of sustainability,
investing here in this market,going forward, no-transcript,

(01:04:34):
investing as an opportunityrather than sort of a cost, so a
lot of those sort of trendsthat I really see as nascent,
thematic investing, sort ofchoosing sustainable themes that
are really lucrative.
So I have eight good sort ofthemes for 2025 that I think I
hope are going to play out.

Speaker 2 (01:04:51):
Yeah, I think a lot of the things we talked about
today are definitely in thatoutlook, so make sure you check
it out.
It's available on the website.
If you Google it out, you'llfind it very, very easily.
And, marina, it's been anincredibly insightful
conversation.
Thank you so much for sharingyour expertise, your unique
takes on ESG and sustainabilityin general.

(01:05:11):
I am very much looking forwardto meeting you soon in Chicago,
and I hope 2025 is the yearwhere sustainability keeps
growing and becomes top of mindfor most, if not all, of the
investors out there.

Speaker 1 (01:05:30):
Thank you so much.

Speaker 2 (01:05:32):
The Blunt Dollar is written, produced, hosted and
edited by me, ignacio Ramirez.
Everything you hear concept,script, sound design and
production comes straight frommy desk and, occasionally, my
kitchen table.
Thank you so much for listeningand join me in the next episode
of the Blunt Dollar for moreraw, honest finance
conversations.