The Rise Of Responsible Investing

6 October, 2021

Responsible investments are the hot new trend. Richard Brandweiner, an alumnus of the Cranlana Centre for Ethical Leadership, chair of Impact Investing Australia and chief executive, Australia, of investment manager Pendal – sees the beginning of a long-term transition in asset allocation towards responsible investing. But transparency and reporting standards are needed to avoid greenwashing.

“2020 was a landmark year,” says Richard Brandweiner. “We had the bushfires with blood red skies and ash on our coasts. We had the #metoo and Black Lives Matter movements, and then the pandemic. It was an incredibly significant year in recognising that we have an obligation to each other and to operate in a way that’s mindful of our collective future.”

Instead of a bump in the road, the COVID-19 pandemic appears to have been a tipping point for responsible investing. A widespread mood to ‘build back better’ is seeing green bonds and social bonds, which raise money to go to positive environmental and social projects, soar in popularity.

“The management and board changes as a result of Juukan Gorge [at Rio Tinto] and at AMP wouldn’t have happened 10 or 15 years ago,” Brandweiner continues. “Society is increasingly holding people to account for behaviour that goes beyond a linear definition of maximising shareholder return. People are recognising it’s actually about optimising outcomes for all stakeholders, because if you don’t, you won’t have a good business.”

Evidence shows that sustainable investing produced returns as effectively as other investment approaches and that younger generations are at the forefront. But there is the problem of ‘greenwashing’, the faking or overstating a company’s environmental soundness. So, how do advisers navigate these tricky waters to ensure investors are getting what they value? Richard Brandweiner says “We’d like to see a harmonisation of standards around the world, and improved disclosures from companies around non-financial factors. We’d also like to see more investors recognise they have power, through their investments, to change the world.”

via Acuity, Ben Falkenmire, 30 September 2021. Read the full article here.

Cranlana Centre for Ethical Leadership’s programs include the 2 day Executive Ethics, 6 day Executive Colloquium and year-long Vincent Fairfax Fellowship. We also deliver online and tailored corporate programs. Find the right program for you. They are all held under the Chatham House Rule to encourage genuine and open debate, and allow participants to candidly discuss sometimes sensitive issues in private while allowing the topic and nature of the debate to be made public, and contribute to a broader conversation. The alumni program offers ongoing leadership development support and a lifelong connection with Cranlana.

Image by Thomas Müller from Pixabay.