Greenbank were winners at the 2023 Sustainable Investment Awards.
Here, Investment Week hears from John David, Head of Greenbank on their win.
Greenbank took home the Best Sustainable Investment Wealth Manager/DFM Group at the Sustainable Investment Awards 2023. Read more about them here:
How have you approached integrating sustainable and ESG factors within your firm including enhancing investment processes and your client proposition?
Sustainability is core to Greenbank's investment process, guiding asset allocation, security selection and portfolio construction. Our sustainable development theme framework considers eight key areas and we analyse how themes shaping the world - such as inclusive economies, decent work or resource efficiency - are impacted by, and impact on, the investments we make.
Our in-house Ethical, Sustainable and Impact research team works alongside our investment teams. We have a comprehensive database of proprietary research, combining bottom-up ESG analysis with thematic considerations. This enables us to find companies that deliver benefits for people and planet, and are resilient in the long term. We utilise data sources including specialist ESG research, 3rd party ESG data, company reports, company meetings, NGO insights, our engagement activities, and news reporting. This gives us an edge over peers who simply overlay ESG factors, as we are able to consider risks and opportunities that may not be immediately apparent.
We consider not only how ESG factors may impact investment performance, but also the impact that our investee companies have on society and the environment. This awareness of double materiality is critical in aligning investments with our clients' values.
Our team has a strong background in sustainability - professionally, academically, and personally. Our founding members launched the UK's first tailored ethical investment service (1992) and we have continued to innovate and lead in sustainable investment ever since. We offer a range of services, from fully bespoke portfolios to a unitised multi-asset portfolio range in partnership with Rathbones' Unit Trust division.
What key developments have you made in this area, particularly over the past 12 months? What have been your priorities and significant achievements?
Since its inception, Greenbank has been a leader in providing bespoke ethical, sustainable and impact investment services. However, we are not complacent about our position so we continue to innovate in order to remain at the forefront.
2022 was a challenging year for sustainable investment, with pockets of the investment industry questioning whether ESG had ‘had its day'. At Greenbank, sustainable investing is not an add-on to an otherwise conventional service, it is core to everything we do. Despite challenging markets, we did not water down our approach to chase short-term returns at the risk of knocking the longer-term strategy off track. We are confident in our vision for the future, though mindful of the many factors unsettling markets in the short term and endeavouring to navigate a path through them.
We believe the long-term investment case for sustainability is as strong as ever, with companies providing solutions for systemic challenges supported by regulation, changing consumer preferences and an urgent need to halt the climate crisis and to protect and enhance our natural habitats.
In the past year we have further strengthened our investment process and capabilities with growth in our investment research and ESI research teams, to expand the breadth and depth of our research capacity. We have also appointed a new Greenbank Head of Investments to oversee and guide future development of our investment strategy.
How can you demonstrate excellence in terms of client communication and reporting on sustainable investing? How has this evolved over the past year?
We believe in full transparency, so clients can see the financial and sustainability performance of their investments. We provide breakdowns of portfolio holdings by impact category and by sustainable development theme, so clients understand where their money is invested and how their portfolio aligns with their sustainability objectives. We also offer a range of portfolio carbon footprinting and climate alignment reporting.
Updates on engagement and stewardship activities are provided on a quarterly basis and clients receive a detailed annual review summarising sustainability performance and news over the previous year for all holdings in their portfolio. We also publish an annual standalone Engagement Review which provides clients with updates on our engagement activity.
In addition, we host regular events for clients and intermediaries to increase awareness of sustainable investing topics and we also publish research and thematic reports.
Last year Greenbank's Deputy Head Nicola Day attended COP27 as a registered delegate and created daily video-diary updates which explained to colleagues, clients and the public, what was happening ‘on the ground' and highlighting the global nature of the ESG issues covered at the conference.
What would you like to see from the industry in terms of the development of sustainable investing?
Knowledge and understanding remain key barriers for individuals wishing to assess investments beyond traditional financial metrics. Measures such as the FCA's Sustainability Disclosure Requirements (SDR) that aim to help them navigate the marketplace and make informed choices are welcome.
Following the publication of the consultation paper and the draft SDR framework last October, the FCA has been reviewing the extensive feedback that was submitted. We believe that the draft wording struck broadly the right balance between setting the bar sufficiently high to be seen as credible, while maintaining enough flexibility to avoid an overly narrow definition of what is ‘sustainable' that could limit consumer choice.
We are hopeful that the final framework will act as a catalyst for the growth of the sustainable investment market, bringing clarity and confidence to this fast-changing, rapidly-growing and critical segment of the investment landscape.