More than wealthJune 12 2020

Environmental, Social and Governance: Accelerated Trends & Socially Responsible Investing

2 mins read

Samuel Bosanquet

Director, Family Office Services

Within this article we share a recent video live session interview between Samuel Bosanquet, Director of Family Office Services at Sandaire and Citywealth’s editor Karen Jones, as well as some written highlights.

Within this live session Samuel and Karen discuss Environmental, Social and Governance (ESG) trends, explains Socially Responsible Investing (SRI) as well as how Sandaire has responded to Covid-19 and potential future environmental trends.

Karen: The rest of the world may know Environmental, Social and Governance (ESG) as climate change or Greta Thunberg but for us, what does that mean? There’s a lot of confusion around this topic, what is the meaning of ESG?

At Sandaire we, like everyone else, have a slightly different name for ESG. For us, we call this responsible investing. What is responsible investing? We were taught at business school that businesses should maximise profit over all other activities. However, the world has moved on since then. Now we realise that profit maximisation is not the end goal, that there are other factors that need to be considered such as ‘how sustainable is my business?’, ‘what impact is my business having on the environment around it?’ and ‘how well is my business run?’ to name a few. This is where ESG (environmental, social and governance) investing comes in, it’s a consideration of a wider group of factors rather than just investing for profit and there are many different shades of this. Many of our families are very active in this and very concerned about this topic.

Samuel Bosanquet

Karen: People are talking about ESG but some businesses don’t seem to be taking it that seriously within the industry. What are your thoughts on this?

I think that’s a fair comment. I think now most people would recognise that this is the direction of travel, and many would say that it is a one way street. We are unlikely to see students protesting outside of their universities saying ‘we want you to be more reckless with the investment funds’, it’s just simply not going to happen, so I think before you even think about ESG and responsible investing, the biggest thing is realising that, like it or not, the world is moving to a low carbon economy, as well as CEOs having to balance the needs and wants of shareholders against what is best for the business and what is happening in the wider world. Whether explicitly embedding ESG or SRI (socially responsible investing), I believe that it is important to have some consideration for these factors within a portfolio because this is the future.

Samuel Bosanquet