Winter Wonderland: Mental health, SFDR and Scope 3 emissions

'We are huge supporters of any regulation which creates more transparency'

In this year’s fun winter series for ESG Clarity, investment professionals in the sustainable investment industry answer questions on characters that would play them in panto, who needs to receive coal as a present, and ESG wishlists.

Here, David Harrison, fund manager of the Rathbone Greenbank Global Sustainability fund flags the work carried out by CCLA, why we need clarity on SFDR and Scope 3 emissions and why need to increase use of sustainability benchmarks.

Winter festivities: Who would be the main character in your ESG pantomime?

CCLA for several reasons.  The team’s work on mental health and launching a mental health benchmark is very important to help drive industry engagement forward (and is something we are involved in as a group).  Also, their work on the new modern slavery benchmark and the formation of AdvisorAction, which allows better collaboration of smaller advisers when it comes to company engagement.

Winter traditions: Which piece of ESG regulation or policy should be given coal this year?

I am not sure about coal for Christmas, and we are huge supporters of any regulation which creates more transparency for investors. However, one area we would support is some clearer definitions for SFDR, in particular around Articles 6, 8 and 9, which could help promote sustainability labels.

Winter wonder: If you could have one ESG data tool that could do anything, what would it do?

The ability to accurately reflect and track Scope 3 carbon emissions. This is a massive job, and we know there is no accurate way, as of today, of reflecting this.

Winter wishlist: What’s on your new year ESG wishlist?

Potentially more industry use of sustainability benchmarks, which better reflect the process and investment universe of sustainability funds. It would help to have a much better comparator. Current comparators can exclude over 30% of the benchmark because of the sustainability criteria but it would be helpful to have a more accurate representation of the investment universe.

Winter gifts: Summarise a book all sustainable selectors should read.

Volt Rush by Henry Sanderson.  A very thought provoking, but hopeful book.  It highlights the trade-offs of moving to a greener world and how we should think about changing supply chains in the future.