The ESG Factor

Vincent McCarthy, Host of The ESG Factor podcast, chats with Ciarán Hughes and Evan Hughes , Directors of Ethico Ltd, a financial advisory firm that places ESG and sustainability at the core of the investment process. 

Discussed in this episode is:

• Client engagement and sustainability preferences 
• Adapting to changing regulation
• The ESG Framework and misconceptions
• The need to do things differently
• How investment managers can help

Vincent McCarthy, Host of The ESG Factor podcast, chats with Ewa Jackson, Head of Sustainable Client Solutions, EMEA, at BlackRock. 

Discussed in this episode is:

• Sustainability preferences and client portfolios
• Climate risk and net zero considerations
• Corporate stewardship and engagement
• ESG Integration & the spectrum of investment solutions
• Fund categorisation frameworks and SFDR
• Limits of Sustainable Finance and Stakeholder Capitalism

Vincent McCarthy, Host of The ESG Factor podcast, chats with Meggin Thwing Eastman, Managing Director, Editorial Director for ESG & Climate Research at MSCI Inc.

Discussed in this episode is the origin of ESG ratings at MSCI, what they are intended for, understanding the methodology behind an ESG rating, what decision makers can infer from a rating, common misconceptions about ESG ratings, and the limits of ESG ratings.

Vincent McCarthy, Host of The ESG Factor podcast, chats with Pablo Berrutti, Senior Investment Specialist at Stewart Investors.

Do sustainability and quality go hand in hand when investing? As an active investment manager, Pablo shares his insights on how they think about sustainability within their investment process and why it is important as a long term investor with a concentrated portfolio. Also discussed is: whether it can be challenging to find companies that could be characterised as sustainable, climate change, and the interaction between sustainable finance, sustainable investing and the end goal of sustainable development. 

Vincent McCarthy, Host of The ESG Factor podcast, chats with Samuel Grantham, CFA, Investment Director and Climate Transition Specialist, Global Credit at Abrdn. 

Some of the points covered in the discussion are:

• What does the climate transition mean from an investment perspective
• The difference between climate transition and climate adaption
• Types of investment approaches and solutions
• The motivation for change driven by risk/return dynamics
• The challenge within our existing system dominated by short termism

Vincent talks to Liam Lysaght and Harry Jankola, two of the co-founders of FiltraCycle , a sustainability startup based in Dublin, Ireland, that recycles cigarette butts, a major source of environmental pollution.

Their mission is "to intercept millions of tonnes of pollution from damaging our environment, and to protect our oceans". Their recycled plastic - FiltraPlastic - Is "A Raw, Sustainable Alternative To Traditional Acetate Plastic".

Still in their final year of University at Trinity College, Liam and Harry provide an example of young entrepreneurial spirit driven by the pressing need to find innovative solutions to the sustainability challenges we face.

What does the sustainability transition mean for the future of transport? Vincent talks to Alastair Bishop, Managing Director and Portfolio Manager at BlackRock, about the transport revolution, the scale of disruption and the opportunity it represents. Could we have flying cars in 2050? 

Vincent talks to brothers Juan Fernando Ramos and Juan Carlos Ramos who are based in Guatemala City. [Vincent worked with Juan Fernando in 2017, for an impact investment firm in Quetzaltenango, Guatemala.]

They talk about how impact investing has evolved since 2017, economic development in Guatemala, the challenges the country faces and the purpose they have both found in the area of sustainability they have chosen to focus on.

An enjoyable chat and a little bit of a trip down memory lane.

Vincent talks to Dan Grandage, Head of ESG, Private Markets & Real Estate at Aberdeen Standard Investment, about sustainability within real estate, tenant engagement, building for the future, managing carbon emissions and hedging carbon price risk.

Our built environment – which supports everyday life on Planet Earth – has been constructed from the resources from our natural environment, creating an impact through extraction, construction, and an ongoing environmental impact. The push for sustainability is about bringing greater balance between our natural environment and the built environment that we create.

Amanda Andrade - school teacher turned activist - shares her story of the 2019 Vale mining disaster that claimed the life of her sister Natalia and hundreds more in her home town of Brumadinho, Brazil. The disaster has left physical and emotional damage that is still being felt today.

"I don't understand how the U.S. economy works, much less some sort of a self-sustaining one".....- Dennis, Always Sunny in Philadelphia

In this short episode Vincent discusses this challenge when discussing the idea of a 'sustainable economy', the objective of making the subject more accessible to everyone and a brief outline of what is planned for Series 2. 

In Episode 7 of The ESG Factor Podcast, we talk to Anthony MacGuinness, the Head of Quantitative Strategies and Deputy Chief Investment Officer at Irish Life Investment Managers (ILIM). Based in Dublin, Anthony leads the research and development of ILIM’s quantitative investment strategies and portfolio solutions for the institutional and retail market. 

In our discussion we cover ESG in the context of public equities: 

• the motivation for employing a responsible investment approach and incorporating ESG,

• how ILIM’s approach to responsible investment has evolved over recent years,

• the mechanics of implementation and the importance from a stewardship perspective,

• empirical research showing ESG improves risk management,

• the outlook for ESG and what we need to see happen over the coming years. 

In Episode 6 of The ESG Factor Podcast, we talk to Will Oulton, the Global Head of Responsible Investment at First State Investments (FSI). Based in the UK, Will is responsible for defining and delivering FSI’s responsible investment and stewardship strategy globally.

Will was another interesting guest to have on the ESG Factor podcast. From studying Zoology, to a career in responsible investment, he had plenty of insights to share and it was great chatting to him.

In our broad discussion on sustainability and stewardship, some of what we cover includes:

• early impressions of responsible investment from Will’s days at the FTSE Group and the original intentions behind the FTSE4Good Index,
• the fiduciary chain within pension schemes and the stewardship responsibility to members,
• consultants as gatekeepers; Will’s perspective having previously worked as Head of Responsible Investment for Mercer Investments across Europe, the Middle East and Africa.
• the nature of trustee boards, pension scheme values and their ESG integration challenge,
• managing the risk of getting caught in a new jargon bubble and practical stewardship as an active manager,
• the interconnected nature of our economic system and increased awareness post-Covid; a return to science and evidence led decision making,
• Boris the Brave and the future of the UK State!

Are Active Managers who sign up to the United Nations Principles for Responsible Investment (UNPRI) following through on their ESG commitments? In Episode 5 of The ESG Factor Podcast, we talk to Professor Aaron Yoon from the Kellogg School of Management at Northwestern University in Chicago. Aaron shares with us the key findings from his latest research paper - "Analyzing Active Managers’ Commitment to ESG: Evidence from United Nations Principles for Responsible Investment"

We also chat about:

· Aaron’s previous experience as an equity sales trader, his time as a Korean augmentee in the 8th US Army and his move into academia,

· his pivotal research with colleagues at Harvard Business School on corporate sustainability, showing evidence of materiality,

· Chicago’s Milton Friedman and the corporate social responsibility of a business,

· supporting small business owners to maintain an ecosystem in the post-Covid recovery.

· the English football league as an example of an ecosystem on the brink. (He is unfortunately a Spurs fan)

“¡Viva la revolución!” Is Impact Investing truly revolutionary?

In Episode 4 of The ESG Factor Podcast, we talk Impact Investing with Sarah Norris, the co-portfolio manager of the Global Equity Impact fund for Aberdeen Standard Investments.

In this interesting discussion, we chat about:

· Sarah’s path into impact investing and the development of ASI’s impact process,

· discourse analysis and the use of language in impact washing, intent v action,

· whether the “impact revolution” that Ronald Cohen promised is revolutionary,

· the origins of impact investment and applying the concept in public markets,

· the intentions of large private capital flying the flag of impact investing in emerging markets,

· the Sustainable Development Goals and emerging from the COVID-19 crisis.

Vincent McCarthy and Eimear McBride chat with Véronique Menou, the Global Head of ESG Portfolio & Index Research within MSCI ESG Research. This discussion covers the changing role of index providers and their focus on sustainability, the why of ESG – looking at causality – and delves into some of the misconceptions around index construction, data, and performance. They also discuss the outlook for ESG, as we navigate and emerge from the COVID-19 crisis.

Vincent McCarthy and Eimear McBride talk to Ashley Schulten, Managing Director and Head of Responsible Investing within Global Fixed Income at BlackRock. This discussion provides valuable insights on the importance of ESG across the fixed income spectrum. Starting with a look at the drivers of the sustainability revolution, the conversation covers the implementation of ESG within various bond markets, the growth of green bonds, physical climate risks and the outlook for ESG within fixed income.

Eimear McBride chats to Vincent McCarthy about his move to Latin America, working in impact investing in Guatemala and immersion in the world of responsible investment since, including the founding of ESG Ireland and the development of his new podcast series – The ESG Factor.