UKSIF webinar: COVID-19 & Sustainable Finance

Joey Charisi
Joey Charisi26th March 2020

In our first piece of work to help members understand the crisis, we held a webinar in March 2020 with speakers from MSCI, BMO and Ethical futures. A recording of the full event is here, a brief precis follows:

Zoltan Nagy of MSCI outlined how various “responsible” finance indices had performed in Europe year to date. Very encouragingly, the more “ESG-heavy” they were the less value they had lost. Putting that in outperformance terms, then the MSCI Europe SRI Index had outperformed the mainstream MSCI Europe by about 5.5% YTD; the MSCI Europe ESG Leaders Index by about 2.5% and the ESG MSCI Europe ESG Universal Index by about 1.5%. See ESG Indexes graph here.

Alice Evans of BMO ran through that firm’s initial thoughts, which they have written up here. Key points were: some investee companies were able to give less time to engagement; firms will be judged on how they behave now with respect to their staff; AGMs globally would be complex, some jurisdictions demanded physical meetings;  behaviours in the pharmaceutical area were already showing which firms were helpful and which were less helpful. The central theme was that the way firms acted now would be remembered.

Responding to Alice, James Corah of CCLA made several observations. CCLA felt the crisis was showing the importance of profitable companies in terms of providing employment and bestowing  purpose for people- a view that UKSIF has always held, profit is not a dirty word. James also said the “Find it, fix it, prevent it” initiative would delay the rollout of work to the hospitality and retail sectors in view of the immediate challenges there; and he said CCLA might be seeking support from other members for a statement on mental health support in investee firms.

Julian Parrott of Ethical Futures in Edinburgh gave his thoughts informed by feedback from his retail client base. Clients wanted to see more social equity after this crisis, with the focus on employment terms and senior level pay; clients were worried that climate would be” forgotten” in an understandable focus on social issues; and Julian and his clients were hoping that corporates would find a different way of working- less impactful across the piece. And in a session notable for its forward-looking nature and implicit optimism that change would come, Julian cautioned that the outcomes of the global financial crisis had not been immediately positive for the sector and our views.

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