IFAM: Looking ahead, what do you see asthe main challenges for the MPS and the market in which it is positioned? How are you looking to overcome those?
WB: We see green wash as a major challenge going forward as almost every major company strives to justify its approach as ethical. Some companies we have seen have made some very genuine progress. A good example of this is Danish Oil and Natural Gas, a company which successfully transformed itself into Orsted, a renewables-led utility which became one of the biggest owners of renewable assets in the world.
However, in other cases we are concerned to see that companies are spending a lot on PR campaigns but they are doing very little in reality. Some of the oil majors are examples here. To us, maintaining a clear ethical stance and a good understanding of what our investors actually want is paramount. Ethics are dynamic after all. Just five years ago, fossil fuel companies were perhaps viewed more positively than they are now. It’s a classic example of how people’s opinions may also change.
So to sum up, we view our approach as having two criteria instead of just one. Both of these are hugely important.Firstly, we aim to deliver attractive investment returns for our investors – a principle which also applies to any of the third party fund managers we use. We then over lay our focus on sustainability and responsible investment criteria. We see good corporate governance as a sign for good companies. Evidence is now backing this up, that companies which focus on sustainable strategies actually perform better for investors.
Of course, performance will differ over time especially as oil/commodity prices still have a big impact on conventional indices but much less so when it comes to ethical portfolios.
Whilst we must expect performance to be different to the broader market, we can rest assured that we know why those differences are there, as will our investors,and that we can continue to deliver attractive returns for investors across all our portfolios and of course meet their ethical criteria
About Wayne Bishop
With over 27 years City experience in both London and Frankfurt, Wayne started the Ethical Asset Management service in 2002. He introduced active asset allocation and a positive return mentality to then predominantly UK based equity portfolios.He is the lead manager on the personal discretionary and model portfolio services. Having studied both Business and later Theology at University, he has a clear understanding of the need for successful businesses that contribute to the well being of our planet and its entire population. Wayne is now CEO of King & Shaxson Asset Management.