Sustainable investing is headed for a resurgence with the potential to come back smaller and stronger.
Sustainable investing doesn’t work. ESG is just marketing. Impact investing is a club. We’ve heard it all, and after decades assessing and carefully considering the underlying issues, we firmly believe those criticisms are . . . partly true.
One of us (Rob) has spent thirty-five years in financial markets, starting as an economist, moving on to portfolio management, and eventually running an impact focused hedge fund. The other (Aniket) has a PhD in economic geography and spent years in economic development before finding a calling on the sell side as a #1 ranked II analyst. Rob was an investor who saw the promise of a policy lens, and Aniket was a policy advocate who saw the promise of deploying private capital. Both of us believe in rigorous analysis, empirical methods and open debate. Neither of us started our careers intending to “do well and do good”. And yet despite our backgrounds, or perhaps because of them, we both landed as passionate advocates for solving many of the world’s challenges with hard-nosed capitalism.
What we have found over the years is that so-called sustainable investing, when executed in the context of rigorous, long-term financial thinking, works. What worries us is that people increasingly believe it does not, not because it has failed, but because it has been too-often misguided.
Let us explain…
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