ESG Clarity has been catching up with female members of the ESG investment industry to discover how they have adapted to working from home as a result of the covid-19 lockdown
Following on from our sister title Portfolio Adviser which has been running the Working from Home series with investment experts from the wider industry, we also ask how they envisage their new work routine will look like as lockdown is relaxed and tips for remote working.
This week we speak to the chief executive officer of impact fund manager Snowball, Daniela Barone Soares.
How have you adapted to remote working on a longer-term basis from both a portfolio and workplace perspective?
It is fairly easy to work remotely in our business, unlike many others. Of course, we miss interacting with one another in the office and miss interacting with our partners, funds and investors. That being said, as a team we have a call each morning to align priorities and to ‘check in’ on our physical and emotional well-being. We have increased the amount of conversations with our portfolio – to both understand the impact of this crisis on the different businesses and to support them where needed.
How do you think attitudes to ESG initiatives will be affected following the crisis?
They are already being affected – and the forces which will drive towards increased ESG practices are growing.
- The ‘S’ in ESG: whilst pre-crisis there was an emphasis on the climate emergency (which is still present), during lock down it became evident that the people who were called to action and who are sustaining our cities – the nurses, the bin collectors, the bus drivers, the supermarket cashiers – are some of the lowest paid in our society. Businesses are being called on to support their employees – and publicly ousted when their rhetoric doesn’t match their actions.
- Shareholder and public pressure is increasing and will only increase: recent examples are the JP Morgan AGM’s close call on passing a resolution on decreasing their funding of fossil fuels. In the US, businesses are being ‘named and shamed’ for taking federal aid when they didn’t need it.
- Good ESG practices are proving their worth in the pandemic: corporate bonds and equity with high ESG ratings have outperformed the MSCI index. Better governance and better understanding of supply chains and workflows have allowed those companies to respond better and faster.
- Businesses are seeing the wisdom in ESG: as strong social bonds, digitalisation and decarbonisation come into further relevance during the crisis and to rebuild our economies, more businesses will gravitate towards the risk reduction and positive behaviour approach that ESG affords.
How do you feel about returning to work in the office? Do you think you will work from home more in the future?
I am looking forward to meeting my colleagues ‘in the flesh’. That being said, I am very productive at home and expect to be doing more home working in the future – I suspect this will be the case for my colleagues as well. The thought of squeezing into the London underground in rush hour is definitely not appealing, so I hope that we can create better ways to work going forward, in a way that both preserves our interactions and supports our well-being.
What do you think our ‘new normality’ will look like?
From an impact investing perspective, I think it will probably fall in two camps, simultaneously:
- Those who want to rebuild their balance sheets at any cost, thus leaving impact for another day; and
- Those aware that capital is a powerful lever of behaviour and that global crises like the covid-19 pandemic and others relate to unsustainable economic, social and environmental systems. Those are the people who will demand a new normal, a new way of investing, doing business and interacting. There is now enough track record and evidence that market returns can be achieved whilst investing with impact, if risks are properly assessed.
How has the coronavirus affected your day-to-day work – from both a portfolio and workplace perspective?
Our team continues to meet via video every morning. It is a great opportunity to check in on one another, both from a health perspective and workload. We share our weekly priorities and collaborate on what needs to be achieved. We are still super busy. From a portfolio perspective, we are having more conversations with fund managers and investees to better understand the impact of covid-19 in the short and long terms.
What has been your biggest contributor to performance since the coronavirus hit markets? What has been your biggest detractor?
Snowball gives investors access to a global, multi-asset, multi-manager portfolio that maximises positive social and environmental impact with financial returns — and low risk. We have selected a balanced 30 funds and assets, after analysing over 250 over the past three years. Our investments are not so closely aligned with the systemic risks which are making most portfolios crumble. This has been our investment thesis all along: portfolios which look for risk, return AND positive social and environmental impact bring capital where it is needed most, and thus are more resilient and perform better in the long-run. We do this very diligently and so far seems to have paid off in this crisis. It is still early to have re-priced the whole portfolio, but the liquid assets are only slightly down (vs -25% on the FTSE 100) and the illiquid assets are being price adjusted at the moment.
What feedback have you had from clients since the coronavirus sell-off?
Incredibly positive — our investors are seeing Snowball’s investment thesis being validated and are staying firmly invested. Whilst of course the human suffering this virus has created is enormous and sad, there are lessons for all of us, both in how we treat our fellow humans, animals and the planet. From an investment perspective, we believe it is every investment manager’s responsibility to maximise its positive impact in society and the environment and minimise the negative impact of its investments. In the face of a climate emergency, of growing social issues and of a health emergency this is more important now than ever before. Our investors, fund managers and investees all share this conviction.
How do you think attitudes to ESG initiatives will be affected as we move through the crisis?
We are hopeful that, after the crisis, we will see a ‘new normal’ emerge, where the interconnectedness and interdependence which was made so clear by this virus, is taken into account by investment managers more broadly. We have proven that we can generate market returns and deliver benefit to people and planet by following a discipline methodology of risk, return and impact. Others can do it too.
Share some good news you have heard recently about the holdings/sectors/themes you invest in?
These are some examples of investments from some of our funds:
- Viva has launched an online fitness offering that 20,000 people had signed up to by the second day
- World of Books has offered up their considerable logistics and transport infrastructure at cost to help other businesses and worthy causes who might need support or extra capacity with deliveries and logistics at this time.
- Thermo Fisher Scientific to date has made 1.5 million tests available to detect nucleic acid from the SARS-CoV-2 virus, and expects to produce up to 5 million testing kits per week throughout April 2020.
What do you do for fun when you take a break from working at home?
I go for a walk in the park near home, do some exercise, watch some Netflix (watching Homeland), listen to podcasts (one of them is Akimbo by Seth Godin) or read a book (reading a Brazilian poet, Manoel de Barros) I have all of these on the go at the moment.
What is your favourite sustainable snack/hot drink when working from home?
My indulgence is the Pukka organic latte — like a hot chocolate but healthier and sustainable.
Do you have a ‘top green tip’ to share on working remotely?
Well, my flat is as green as can be, given the age of the building… what I have done now that I am working from home is to manage heating just for the rooms being used.