Thoroughly enjoyed speaking on a panel for PCD's webinar titled 'UK & EU Series: ESG and Private Clients - Opportunities and Challenges' yesterday. It was a well-attended and thought-provoking panel. I came away with three key points:

  1. Melanie Griffiths of Equiom made the excellent point that ESG investing, whilst obviously a fast-growing area, is more supply side than demand driven at the moment. Literally every investment manager seems to be talking about it, and incorporating it into strategies, but not every client is doing so. Given that background, an additional problem is 'greenwashing', and knowing which of the advisers in this area are authentic. The B Corp status of Lombard Odier, represented on the panel by Kristina Church, is a stamp of genuine authenticity in a confusing market.

  2. For trustees, ESG investing is yet another example of an old truism - trusteeship is a risky business. Whilst there may be some merit in the argument that ESG investing exposes trustees to some additional level of fiduciary risk, Michael Strachan of IAM Advisory made the excellent point that the converse is also true. Trustees expose themselves to risk by not engaging with it. What trustees should be doing is taking it seriously - learning about the area, engaging with their investment managers, and engaging with settlors and beneficiaries.

  3. Not every part of the world is going at the same pace. Roddy Balfour of Equiom explained that the US, for example, was not currently seeing the same level of demand. Indeed there is an ongoing political battle in the US as to whether pension trustees should be allowed to factor in ESG considerations at all, as I have written about here. Western Europe is moving at the quickest pace, with the courts now re-shaping law to incorporate environmental considerations in particular. That has happened recently in Germany, as I have written here, and most notably with the Shell case in the Netherlands.