That is not to say ESG is not fit for purpose from an investment perspective – rather from a marketing one.  

The reason for this is actually quite simple – ‘ESG’ as an acronym, as a concept, is too abstract.  

Last year, White Marble undertook a research project for a global asset manager, with one very simple and seemingly obvious point emerging – people, investors, don’t really care about ‘ESG’. They don’t really know what it means or how to apply it to their investment decisions. At worst they think of it as just another jargony term thrown around by asset managers to justify increasing fees.  

What they do care about, deeply and passionately, are issues. They care about the increasing rate of drought, and associated flood risks. They care about pollution, especially in the areas where their children play. They care about the spate of wildfires we have witnessed across the globe in the last few years. They care about these issues, at both a global and local level. To me, this is the antidote to the growing concern that ‘ESG’ is not fit for purpose. 

As my co-panelist Graham Precey (Instinctif Partners) rightly pointed out, marketing is responsible for making the intangible, tangible. And ESG is a textbook example of intangible. We need to talk to investors, our end clients, about the things they care about. Our goal as marketers is to bring that concept to life and move it closer to the investor. 

Yes, in these uncertain times investors are often preoccupied by issues such as the increased cost of food and energy, but they also care about broader, longer term ecological and social issues. There is a growing understanding that short-term pain points are linked to long-term challenges.  

Asset managers need to get in front of this audience and understand what they care about in order to deliver solutions. This means doing proprietary research and good old-fashioned market research. Businesses cannot rely on third-party surveys; as they can be manipulated to produce the results favored by the commissioner.  

Focus groups and interviews allow for genuine, unbiased insights that can be really meaningful. And we can be sure that these conversations will also provide fertile ground for marketing to tell authentic stories and paint engaging pictures for our audience. What better starting point than to begin with the very issues we know they care about? 

Early in the day, Richard Benton (Personal Group) made the excellent point that sustainability is often too abstract for many people to understand how they can take meaningful action in their everyday lives. He advocated that asset and wealth managers need to dive deeper into the constituent parts, surface specific stories and opportunities, and show investors tangible examples of what is needed to, for example, facilitate the transition to a more sustainable economy. There are hundreds, if not thousands, of investment analysts in London alone who could likely reel off a list of such examples at the drop of a hat. But as an industry we are not always very good at surfacing those stories from a marketing perspective.  

Marketing is distinct in that it straddles most, if not all, business functions, and we can certainly do more to encourage cooperation and help teams engage with the wealth of knowledge and insight that exists at the heart of every asset manager.   

That is all very good and well, but in order for these stories to land and have impact we need to marry them with insight into what our clients are interested in. Which brings me back to my earlier point – the need for asset managers to talk to their end-clients. 

There was much discussion on the day about the challenge of standing out in a sea of sameness, itself a much overused turn of phrase among marketers in our industry. By bringing together an understanding of end-client interest and surfacing insights into how key challenges can be addressed, we stand a far greater chance of producing campaigns and marketing activities that are differentiated and maybe even inspiring. If our goal is to inspire end-investors to invest more sustainably (depending on the firm’s purpose) then demonstrating impact, and potential impact, is absolutely essential.  

This all sounds quite straightforward, and in many ways it is, but engaging with those audiences and surfacing those investment stories requires asset managers and their marketing teams to commit significant time and resources, not to mention possessing a deep understanding of the issues, sensitivities and regulations surrounding sustainability. 

Get in touch with White Marble if you would like to discuss how we can help support and guide you on this journey.  

Thank you to the Financial Services Forum for organising last week’s event, and Schroders for hosting us. Thank you also to all the other panelists, and the audience, who contributed to an engaging and thoughtful conversation.  

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We have provided consultancy to a raft of asset managers regarding their UK stewardship submissions for this reporting period – and ahead of previous submissions – and we find a number of queries come up again and again.

For those in the final days of preparation, and for others looking ahead to the October submission date, we wanted to provide answers to three of the most common questions we get asked on stewardship submissions.

If you’d like to chat further about our tried and tested approach to stewardship submissions, get in touch here.

Q: How much time and resource should we be putting towards this?

A: Without wanting to cop out on this one, it really does depend. And there are some supplementary questions that could help an asset manager answer this. First, how much of your brand, business model and identity are defined by sustainability? If you are a business genuinely trying to build a reputation and investment capability centred on sustainability, then demonstration of your stewardship credentials are a baseline requirement, and the UK’s signatory status remains a litmus test of your commitment. In this scenario, we would suggest a significant amount of time and resource should be targeted towards applying for and securing your FRC accreditation in order to back up the claims you make in market around the importance of sustainability and your authority in the area.

If, on the other hand, you are applying for FRC signatory status because you feel you should, or as a ‘tick-the-box exercise’, then please don’t. In this situation, you could throw months and months’ worth of preparation from an internal team bolstered by support from external consultants and still not pass muster. Unless there is a genuine appetite and appreciation for stewardship and the value it brings to your clients within your organisation, then motives should be questioned, and serious consideration applied to whether you should submit or not.

Q: What matters more – the journey or the destination?

A: From what we have seen, reviewed, and discussed with our clients and networks, a key takeaway has been that the FRC are looking for evidence of your intention towards and evolution of stewardship. Even for those who believe they have achieved the ‘gold standard’ of stewardship (which is after all a subjective concept) in any given reporting period, the reality is the goalposts keep moving.

Revisions to the UK stewardship code were last made in 2019 and applicable from January 2020. Previous updates were made in 2012, just two years after the code’s launch in 2010. Given that the prominence of sustainable investing and the pace of change has built considerably over the past decade, we expect updates from the FRC to be more regular from now on.

While we do not know what subsequent revisions might have in store, one thing we expect to remain consistent is the emphasis placed on transparency and reflection. In our experience, the FRC recognises the world, our industry, and therefore none of its constituents, are perfect.

That is why they prize openness in the case studies and evidence shared, and a spirit of genuine improvement driven by lessons learned from those instances stewardship activities or outcomes fall short of stellar.

If asset managers can demonstrate:

how they try to formalise their approaches to stewardship, and why,

how they have documented/are documenting their processes,

how they follow these processes to the best of their ability/applicability; and

how they bake in reviews and subsequent bolstering of their governance frameworks and processes to improve them over time…

…this is imminently preferable to submitting a report that skimps on detail, infers process and rigour without evidencing it and sets the applicant up as a paragon of stewardship with nothing left to learn.

Q: How long/short should it be and does design matter?

A: Every conversation we have with clients about stewardship reporting eventually turns to this query. It usually stems from a dual concern around wanting to be thorough and detailed enough while ensuring the report doesn’t run the length of a small novel and remains digestible.

For different businesses length will vary. For a global asset manager with strategies across the full spectrum of asset classes and markets, the area they are required to cover is understandably broad and the FRC prefers to see case studies and examples representative of the profile of the business.

Meanwhile, smaller or more focused firms might find they can fulfil the required detail in less than half the length. We have seen reports ranging from 25 pages in length to a whopping 138 pages. And while we wouldn’t recommend the latter, we firmly believe that using narrative structure, layout and design devices to help the reader navigate the report and find the most pertinent information is what matters most.

Another trend we have noticed is that of some asset managers using their firmwide sustainability report as their stewardship submission – something we would definitely advise against.

But that’s a topic for another day…

Good luck to all those working towards the end of April deadline!

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The Sustainable Finance Disclosure Regulation (SFDR) is a component of the European Commission’s Action Plan on Sustainable Finance. It was introduced in accordance with the EU’s goal of reaching Net-Zero by 2050, in line with the Paris agreement.

The SFDR is an incredibly complex topic, but over the coming weeks we’ll try to break it down for you.

Why was the regulation put in place?

The SFDR’s most tangible aim is to deter ‘greenwashing’ and make sustainability claims made by financial market players (FMPs) and financial advisors (FAs) more transparent. It intends to offer investors a clearer picture of the sustainability profiles of the assets they’re invested in, making it easier to accurately compare them.

The broader goal at play here is to guide the flow of investment in Europe towards sustainable investments. The regulation empowers investors by allowing them to make more informed and ESG-conscious investment decisions.

So what does that actually mean?

Investment products are labelled as Article 6, 8 or 9 funds and must provide certain disclosures in line with their categorisation. Article 9 funds (also known as dark green) have sustainable investing as their specific objective, whereas Article 8 funds (also known as light green) only incorporate environmental and social characteristics among others. Article 6 funds – the default categorisation – have a limited sustainability impact, and their labelling shouldn’t include references to sustainability or ESG.

How have the regulations changed?

The SFDR, which came into effect in May 2021, establishes standards for reporting on both the entity level (i.e., the investor) and the product level (i.e., the fund).

By June 30th 2022, financial market participants were encouraged to incorporate ‘best effort disclosure’ into their annual reporting, with this regulation becoming mandatory from January 2023. The January 2023 update is intended to improve product-level reporting, while exhibiting compliance with the environmental goals outlined by the EU taxonomy.

• January 1, 2023 – Pre-contractual disclosures for products promoting environmental or social characteristics
• June 30, 2023 – Final date to report on PAIs of investment decisions in 2022
• June 30, 2024 – Final date to report for the second time over reference year 2023 on PAIs of investment decisions

Downgraded funds and ‘the great reclassification’

With the January update recently having come into effect, we are seeing a marked shift in how funds are being categorised.

In what has been dubbed ‘the great reclassification’, firms including Amundi, BlackRock, Axa, Invesco, NN Investment Partners, Pimco, Robeco, and Deka have all recently downgraded ‘dark green’ Article 9 funds to ‘light green’ Article 8 status in anticipation of the European Union’s upcoming SFDR deadline.

According to ESG Clarity, a quarter of all Article 9 funds – as many as 1500 – are at risk of having their status revoked. This is because they are either failing to meet the necessary criteria in terms of furthering sustainable initiatives, or have not provided the necessary statistics to corroborate their success in this area.

In September FE fundinfo made the point that ‘It will be interesting to see which way this goes – will Article 9 funds tighten up their investment criteria or will groups start to reclassify their funds as Article 8?

It seems that, amid fears of greenwashing accusations, fund managers are opting for the latter option. It has been announced that over 130 funds have been downgraded to Article 8 status, as of November.

Hortense Bioy, Morningstar’s Global Director of Sustainability Research, noted that – for now – Article 9 is ‘still attracting money’. Despite this, we must also recognise that ‘some managers are reporting lower client appetite because of both reclassification and greenwashing concerns.’

Where does this leave the SFDR?

At the end of last year, MainStreet Partners, an ESG advisory and analytics firm, compared Article 8 and 9 funds with their own ratings. They discovered that roughly a fifth (21%) of funds classified as Article 8 had an ESG fund rating from MainStreet Partners of less than 3 out of 5, which meant that the agency would not classify them as ‘sustainable’.

Furthermore, according to a research by Clarity AI, more than 10% of the 750 Article 9 funds it examined had exposure to businesses that ‘violate’ the norms of the UN Global Compact or the OECD Guidelines for multinational firms.

These criticisms, coupled with an ‘exceptionally unclear’ framework, (Volhard, partner at Debevoise & Plimpton) leaves many questioning the credibility of the SFDR completely.

Now, we could get into the nitty gritty of Sustainability Risk and PAI disclosures – and we haven’t even scratched the surface as to how this regulation compares to that of other territories – so we’ll save that for our Live LinkedIn event, which you can register for here.

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The prominence of these themes highlighted the extent to which biodiversity can be viewed as much as a social issue as an environmental one.

Relationships with nature

Although no culture is a monolithic, some Western conceptions of nature have historically framed the natural world as a treasure trove of resources ripe for plunder, rather than a fragile ecosystem whose equilibrium must be carefully managed. In contrast, the focus on coexistence with nature present in many of the world’s indigenous cultures is more conducive to responsible environmental stewardship. In this regard, the inclusion of terms such as “mother nature” in the final draft of the agreement was refreshing and reassuring.

Such a relationship of coexistence is predicated upon perceptions of co-dependence rather than ownership, which requires the movement beyond some conventional Western attitudes. Indeed, the political overtures overshadowing COP15 have only highlighted the ways in which our perceptions of the natural world are coloured by notions of ownership, whether private or national. While it is unrealistic to expect that generations of thought will be immediately dislodged, biodiversity must be conceived of as an international rather than a national asset.

It is therefore heartening to see that a number of the targets laid out in the final draft of the framework are aimed at changing consumer behaviour – ensuring that people are empowered to make sustainable consumption choices (Target 16), and identifying and reforming incentives that are harmful to biodiversity (Target 18). These goals can be accomplished through the introduction of relevant policies and legislation, as well as through improving education and expanding access to information.

The same shift in conceiving of the natural world as a system to be collectively safeguarded rather than an asset to be owned and exploited by competing parties is also crucial to how we think about funding efforts to protect and replenish biodiversity. Target 19 of the agreement’s final draft prioritises international funding – specifically that from developed nations, in support of developing nations – to support biodiversity plans at the national level. This approach stresses the need for collective international action to conserve biodiversity.

Area-based conservation – effective, but historically flawed

The end does not always justify the means. Land-based conservation projects, such as national parks and conservation areas, can violate human rights. Whilst such approaches are often cited as the most effective means of conservation[i], in the past such measures have included the mass relocation of indigenous peoples and the imposition of severe restrictions to traditional agriculture and land management. The reality is that the traditional stewards of land are those best placed to protect it. National Geographic notes that indigenous people protect 80% of global biodiversity while comprising less than 5% of the world’s population[ii]. There is a growing recognition from the scientific community of the integral role indigenous communities play in conservation – indeed, indigenous peoples’ lands account for 37% of the remaining natural lands on Earth and store >293 gigatons of carbon[iii].

The final draft of the text released on Monday morning seeks to address and protect the rights of native groups living in environmentally important areas. There are frequent references to “protecting and encouraging customary sustainable use by indigenous peoples and local communities” throughout the final draft text, in conjunction with a specific statement that “nothing in this framework may be construed as diminishing or extinguishing the rights that indigenous peoples currently have or may acquire in the future”. It seems that – in theory, at least – the voices and rights of indigenous people are being recognised, and allocated more of the prominence that they are so clearly due on this particular subject.

We need to tackle the social aspects to achieve the environmental goals

While issues relating to biodiversity are clearly environmental in nature, in practice they are very much a social challenge too. The human destruction of ecosystems, and the subsequent loss of biodiversity and the traditional lifestyles of many indigenous groups, has been driven by a prevailing mindset that views humankind’s relationship with the natural world in terms of ownership and dominance. The need to shift from a micro to a macro sense of ownership of and accountability to natural capital, the need to address patterns of consumption and behaviour that are inherently damaging to the natural world, and the vital role of certain ethnic populations in the protection of biodiversity are all accounted for in the final draft of COP15’s post-2020 global biodiversity framework.

How the 23 Targets are put into action and the role that private sector financing can play is, however, another matter, and one remains up for discussion.

[i] Dr. John Robinson, Joan L. Tweedy Chair in Conservation Strategy at WCS and Vice President and Regional Councilor for North America and the Caribbean at IUCN

[ii] https://www.nationalgeographic.com/environment/article/can-indigenous-land-stewardship-protect-biodiversity-

[iii] https://www.science.org/doi/10.1126/sciadv.aaw2869#core-R74

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Thus far, over 15 state treasurers have publicly signed up to For the Long Term, a non-profit organization whose mission is to ‘help public treasurers leverage the power of their offices to deliver sustainable long-term growth’.

With the intention of building a better understanding of the impacts of the anti-ESG movement on a state-by-state basis, we have created a map that illustrates the leanings of individual states in this area, on the basis of the most recent legislation or statements they’ve issued. Sentiment towards ESG is plotted state-by-state based on current and proposed ESG regulations as of 10.10.22, and signatures of the For the Long Term non-profit list.

Key Marketing Considerations

Responsible Investor articulate a view held by many, regardless of their stances on anti-ESG legislation, that ‘removing this tool (ESG) from the investment toolbox is as misguided as removing any other risk analysis tool’. However, this volatile and rapidly changing landscape has left the strategies of many fund managers in disarray. A hedge fund advisor at NorthPeak shared that “anecdotally, we have heard cases of managers feeling the need to create two separate pitchbooks to avoid politicized debates about values, even though their investment process is the same.” The question thus becomes – given the turbulent climate, how do we communicate the ESG dimensions of investment products to clients without alienating certain investors?

We have outlined some key considerations to help investment marketers navigate the topic:

Understand concerns from both sides

It is clear that ESG conversations are becoming increasingly nuanced and complex in the US. It is important to remember that, as marketers, our first responsibility is to understand the marketplace in which our products exist. This encompasses building an understanding of a range of perspectives, so that we’re able to effectively communicate with our target audience and address their concerns. The map above helps us identify potential hotspots where ESG messaging may require additional context, nuance, or re-framing. It allows us to track consumer appetites and behaviors across geographic regions, which is an important step in the marketing process for any product, not just those related to ESG.

As Marina Severinovsky, Schroders’ Head of Sustainability for North America, observed: “It’s about having empathy, recognizing that (ESG objectors) care a great deal [about climate change], but that they also have to consider the local economy.” The topic of ESG, therefore, must not only take into account values – of cities, states and nations, as well as individual investors – but also the practical concerns that underpin their investment decisions. As the US mid-term elections approach, it is essential that strategic decisions regarding marketing exhibit the appropriate sensitivity

Get to know your client’s unique ESG appetite

Many firms on both sides of this debate argue that their ESG investment strategies are largely client driven, rather than deriving from any form of moral grandstanding. Adapting to the needs and preferences of clients, as well as the current political climate, requires fund managers to minimize any potential ambiguities in their strategies. A growing number of firms are making use of tools such as quizzes and questionnaires when advising clients on ESG investments. This approach enables individual advisors and firms to create personalized investment solutions for their clients based on individual ESG preference

The conversation and controversy surrounding ESG investing are not going to abate any time soon. Key upcoming events in this field, such as the US midterm elections and COP 27 summit, are likely to further enflame discourse. Now, more than ever, it is paramount to balance our investors’ stances regarding sustainable investing against the authentic position of our own firm and adjust our messaging accordingly.

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After the first few weeks of complaints from his teenage brother who was not allowed to relax his tired aching muscles in a hot tub, everyone adapted easily. I am proud of my little eco-warrior for taking a stand, however small, in the battle to change our attitude towards the environment. In his own way, my son has tried to create a community (his family) where people come together and respond with action to a worrying situation.

However, it is not always so easy, and people react differently to the widespread uncertainty that climate change causes. Over the past 10 years, there’s been a worrying rise in a condition termed eco-anxiety, especially among young people. The American Psychological Association (APA) describes it as “the generalized sense that the ecological foundations of existence are in the process of collapse” and a “a chronic fear of environmental doom”.

First-hand and indirect experience

Anxiety around environmental issues can stem from first-hand experience of the effects of extreme weather conditions. These include hurricanes, droughts, and wildfires and the subsequent fear of losing one’s home, job, livelihood. The APA points out that a changing climate can affect mental health in several ways and manifest not only as anxiety but also as trauma and shock, post-traumatic stress disorder (PTSD), depression and fear. It can have potential consequences on physical health too, such as high blood pressure and heart disease.

However, people can and do experience eco-anxiety even if they are not directly affected by environmental damage. Think Greta Thunberg and the thousands of people who feel helpless and betrayed, especially given the indifference with which world leaders have often treated the climate crisis.

A 2021 survey led by Bath University aimed to record young people’s anxiety around climate change. It collected responses from 10,000 people aged between 16 and 25 across 10 countries: UK, USA, Australia, Brazil, Finland, France, India, Nigeria, the Philippines, and Portugal.

A staggering 75% of young respondents said, “the future is frightening”. In some countries, that number was even higher. In Portugal – which experienced severe wildfires – it was 81%, and in the Philippines, 92%.

More than 50% of survey respondents said they felt “sad, anxious, angry, powerless, helpless, and guilty” about climate change. More than 45% said feelings about the climate affected their daily lives. Over half (56%) said they think humanity is doomed. And four out of 10 are hesitant to have children.

I find these numbers heartbreaking. Young people shouldn’t be worrying about not having a future.

Climate psychology

From the survey it transpired that government inaction is inextricably linked to eco-anxiety. Levels of anxiety appear to be greatest in nations where government climate policies are considered weakest. In particular, people in southern regions of the world were the most concerned.

Another study conducted by ClimateCare in the UK in 2020 revealed that, even in the middle of a pandemic, young people were more concerned about climate change. They felt they were less equipped to fight climate change. They didn’t know what to do, they felt powerless.

Climate change is happening now. It has an impact on more or less everyone on the planet and yet young people feel alone in their concern about the environment, citing a lack of real commitment from world leaders to address the issues. This leads them to develop a multitude of feelings, from guilt to shame, to resentment.

Over the past few years scientific research and media coverage around the effects of climate change on mental health have increased exponentially. Climate psychology has developed in response to the growing eco-anxiety in (mainly) young people, in order to both emotionally and psychologically support those who feel helpless. It is also aimed at empowering them to turn hopelessness into positive change and engagement.

Is eco-anxiety all bad?

Maybe not, or not completely.

Nobody can dissociate from climate change; it is a reality that we all must face.  The fact that an increasingly large number of young people worry about it means that they care, deeply. However, the goal we (young and less young individuals) should aim to pursue is to accept the fact that we are part of the problem and transform this sense of helplessness and overwhelming despair into empowering tools of positive action and meaningful change.

Dr Patrick Kennedy-Williams, a clinical psychologist, said “…the cure to climate anxiety is the same as the cure for climate change – action. It is about getting out and doing something that helps.” All the better and more powerful if we act as a community. A community of like-minded resilient individuals determined to react differently to reality and able to keep going in the face of adversity.

If on one hand, the tackling of environmental issues relies heavily on government and corporate actions combined with societal change, on the other hand we can start taking steps, however small, to address eco-anxiety. It can help us feel more in control of our emotions, and at the same time contribute to saving our world. Accessing informative and reliable information, volunteering, practicing positive thinking, and even understanding when it is time to step away from the information overload and just switch off. Switching from baths to showers could be a good start.

Sources:

Force of Nature

Psychology Oxford

Climate Cares

Further resources about coping with eco-anxiety:

Climate Cafés

Climate Psychology Events

Global Citizen, How to deal with climate anxiety

NewScientist, Stressed about climate change? Eight tips for managing eco-anxiety

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Sheltersuit is a non-profit organisation that aims to help the homeless. It partnered with Chloé, the renowned French fashion house, to launch their own fashion label during Paris Fashion Week. A world of contrast and a unique partnership.

A Sheltersuit, created by the Dutch designer Bas Timmer, is a combination of a wind- and waterproof jacket and sleeping bag, made entirely from upcycled materials and assembled in the Netherlands by refugees and formerly homeless people. In 2021, Chloé x Sheltersuit partnered to create backpacks from Chloé waste fabrics to finance two Sheltersuits and to support Sheltersuit’s mission. This then evolved into 550 backpacks sold, the making of 1100 Sheltersuits, 5500 kg of upcycled materials and three full-time jobs (Unsheltered Moments, 2021).

The unexpected collaboration is, as Bas says: “a fantastic example that stems from Chloé’s drive to change the narrative of luxury fashion and to infuse it with purpose”. One that is very welcome considering the fashion industry’s reputation of being unethical and ecologically harmful.

Given this unusual premise, I wasn’t quite sure what to expect when I attended the launch last week. On my seat was the first edition of ‘Unsheltered Moments’, Sheltersuit’s own magazine, which includes stories of 20 individuals who live on the streets. Each story is written with an inspirational flair. It also featured close-up photos and a QR code that enables the reader to learn more about each person and their experiences. Words are deliberately chosen to create connection, engagement, empathy. For example: “Meet Sandra”, “Listen to Mike”.

During the show, the audience – consisting of journalists, influencers, as well as friends and family – heard stories and inspirational talks from people who experience homelessness, whilst the models walk in. The models, each presenting luxury streetwear pieces, represent the society in which we live.

As marketers, we mostly think about concepts such as differentiation, values, impact and, perhaps more recently, sustainability. We try and demonstrate a brand’s values. We aim to close gaps between said values and actions. Sheltersuit Label’s show prompted me to reflect on my role as a marketer and look at it from a different perspective. For them, purpose is the most important driver, the rest follows from that. Not every business can put purpose first, but perhaps we can put people first?

Gen Z and millennials are gaining more wealth and are seriously concerned with social and environmental causes (Amed et al., 2019). This drives where they buy from, what brands they engage with and who they work for. The vast majority of young consumers say they would be more loyal to employers that are aligned with those values (Amed et al., 2019).

Some companies in fashion are sitting up and listening more carefully to their audience. Consumers expect more from their clothes and the brands that produce them, according to Perryer (2019). Companies must step up their ethical practices and credentials to keep hold of their customers. With this, many are implementing corporate social responsibility policies to transform their business processes, and they are witnessing a bonus uplift in consumer loyalty as a result (Perryer, 2019).

Right in front of me was a show – a brand – that has put thoughts into actions. Sheltersuit showed commitment to its purpose and communicates this well to their stakeholders. Purpose flows through its product, marketing and partnerships. Sheltersuit’s reason for existing is its mission to tackle a specific global issue, and the attitude towards the problem is not simplistic or superficial, to solve it in its entirety, but to have focus. In other words, start small but just get started!

Sheltersuit nailed it from a brand perspective. They are purpose-led, genuine and use fascinating, raw, yet cool marketing tools that can speak to its multifaceted audiences, while being authentic. Perhaps its success comes down to three simple words: listen, act and communicate. The more that companies express an authentic view, the more that those who don’t will be exposed (Amed et al., 2019).

I keep thinking about their motto, which appears loud and clear on their clothing pieces and on their website: people helping people. A reminder for us marketers not to forget the human element, connectivity, empathy in our daily work. It’s a journey that the asset management industry is only just beginning. But we are seeing real engagement with and commitment from our clients to articulate their story, values and purpose in a way that is authentic to their audience as people, not just as businesses.

Bibliography

Amed, I., Balchandani, A., Beltrami, M., Berg, A., Hedrich, S. and Rölkens, F., 2019. The influence of ‘woke’ consumers on fashion. [online] www.mckinsey.com. Available at: <https://www.mckinsey.com/industries/retail/our-insights/the-influence-of-woke-consumers-on-fashion> [Accessed 8 March 2022].

Sheltersuit, n.d. About Sheltersuit. [online] Available at: <https://drive.google.com/drive/folders/12qKTJz7FZkqkWnT_t5u3MJ5vXIu9Vy1h> [Accessed 8 March 2022].

Perryer, S., 2022. Fashion industry seeks to shake bad reputation with CSR initiatives. [online] Europeanceo.com. Available at: <https://www.europeanceo.com/business-and-management/fashion-industry-seeks-to-shake-bad-reputation-with-csr-initiatives/> [Accessed 8 March 2022].

Unsheltered moments, 2021. Unsheltered moments. (01), p.5.

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When I spoke to our CEO & Founder Twink Field earlier this week, we remarked how inspiring it is to compare the current makeup of financial services with the picture from as little as ten years ago. Just within investment management, there are numerous strong female marketing leaders, each with their own style and personality, shining as role models for so many younger marketers.

Particularly refreshing for me is how different female leaders are today, and proudly so. Not that long ago, it seemed (from my perspective anyway) that you had to act a certain way to get to the top. Or to put it more bluntly: you had to be as manly as the male leaders.

Thankfully this has changed. We have made room for different types of leaders, and for women to be comfortable leading with their own style and personality.

While I’m very encouraged by this progress, I daresay we need to work much harder to give this message to the next generation of female leaders – specifically our younger girls (and boys).

What does it mean to be a girl?

As adults, we know that being a woman doesn’t mean wearing a dress, high-heeled shoes and pink lipstick. We now embrace the diversity of women leading the way in so many areas. Just think of how much our female rugby, cricket and football stars have done to advance broader participation in traditionally male sports.

But does our younger generation of girls – and boys – know this too? Do they know it’s OK to be a girl who likes tutus and football?

I’m not saying this isn’t happening, by the way. But I would argue we still hear too many references to phrases such as ‘tomboy’, in reference to girls who do things typically associated with boys. Too many teenage girls are still being bullied and labelled ‘odd’ if they don’t fit in with an outdated stereotype of being a girl.

So what if a girl likes climbing trees and hates dresses? They shouldn’t be made to feel uncomfortable being a girl who doesn’t act the way society believes girls should.

Build a sustainable world

Only once we are more welcoming to all manner of girls and women, can we have a chance at equality. If we embrace a diverse church of women, we pave the way for stronger, more sustainable businesses, because we aren’t excluding people who could potentially make a significant contribution.

This starts with the example we set for own children – girls and boys. We need to raise a generation of daughters who can be comfortable in their skin and not feel beholden to fit into a stereotype.

If they can learn from a young age that it’s OK to be a girl regardless of how they look, act or dress, this can free them to dream bigger and consider careers and industries they might not have previously.

Only if we nurture a more inclusive view of women, can we build a more sustainable world.

So, my big ask for this year is: can we make all girls feel welcome?

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A year on from the introduction of the EU Sustainable Finance Disclosure Regulation (SFDR), the report offers a fund-level analysis of approximately 4,200 funds and ETFs assessed and rated in the MainStreet Partners universe. The team at MainStreet Partners has developed a proprietary methodology that goes beyond many of its peers’ ratings, which tend to be based exclusively on the underlying holdings of a portfolio.

A comprehensive analysis

Their approach to both qualitative and quantitative analysis encompasses three pillars of assessment:

1. The overall asset management firm
2. The fund’s investment and ESG strategy
3. The components of the underlying portfolio

The ESG scores range from 1 (low) to 5 (high), but the final rating is not simply an average of the three pillars outlined above. In total, they assess 80 indicators, each of which has a specific weighting in the overall score. Additionally, the model includes “bonus” elements, which are dependent on the category a particular fund or investment sits in.

Key findings from the report:

SFDR aims to bring clarity and consistency to how funds are labelled from a sustainability perspective. While this regulation is certainly a start, there is still significant variation among products in each category. This in-depth analysis of funds across regions, asset classes and size of asset managers shows some interesting observations:

• Europe continues to lead the way on sustainability disclosure, regulation and ESG integration. In contrast, the US is still at the start of its journey. On average, Article 9 funds managed by asset managers head-quartered in Europe, score a notable 0.4 points higher than their US counterparts.
• Boutiques performed better than their larger competitors at both the strategy (Pillar 2) and portfolio level (Pillar 3). Large and medium-sized managers scored highly at asset manager level (Pillar 1).
• Multi-asset funds tend to have both a lower degree of ESG integration in their investment objectives and are less aligned to the Sustainable Development Goals compared to other categories or sectors. On average, multi-asset funds score 0.6 points (c. 12%) less than other asset classes for Article 9 funds.

Most funds in the MainStreet Partners universe remain focused on environmental themes, while social themes account for only 7% of the thematic category. Flows also reflect the dominance of environmental themes, perhaps given the current preoccupation with net-zero targets. Article 9 environmental funds have an average of EUR 1.3 billion in assets under management. Social funds in the same classification average EUR 384 million.

Overall, the classification of funds under Article 8 and 9 has correlated with larger inflows into these products, suggesting that investors are placing their trust in these labels. However, assessing the degree of genuine ESG integration has arguably become more difficult. This is due to the diversity of products on show and the absence of standardisation. Around a fifth (21%) of funds which have been classified as Article 8 have achieved a MainStreet Partners ESG Fund Rating of less than 3 out of 5. Missing this threshold of 3 means that these funds would not be classified as “Sustainable ” by MainStreet Partners.

Find the full report here, including regional and asset-class level analysis and more details on emerging themes such as hydrogen and sustainable food.

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