Latest / Two in Twenty / AIM High: Building an ESG Business & Brand (Part 2)

Transcript

AIM High: Building an ESG Business & Brand (Part 2) · Two in Twenty

• 0:02
  SPEAKER_01: Hello and welcome back, everybody, to the latest episode of AIM High.
• 0:06
  SPEAKER_01: This is actually part two of a conversation that we started with Carlo Fasinotti from Nordia Asset Management and Benji Elston, who's from White Marble, my colleague and fellow director who specializes and leads our ESG practice.
• 0:26
  SPEAKER_01: So we are picking up on the conversation that we started with those guys in part one, which hopefully you've all listened to.
• 0:34
  SPEAKER_01: And in this session, we're going to be getting much more involved in terms of the kind of the trust issues, the greenwashing issues that exist in this space, as well as how we as marketers can help the business authentically position themselves and bring better reporting and communications to what we do.
• 0:55
  SPEAKER_01: So I hope you enjoy this part two and uh look forward to hearing your feedback.
• 1:01
  SPEAKER_01: Well, thank you guys for staying with me for part two of uh what has already been a really interesting conversation.
• 1:07
  SPEAKER_01: So anybody who's missed part one, I suggest you uh get back and have a listen.
• 1:13
  SPEAKER_01: Um I think and wonder whether we start to move the conversation on to kind of this issue of greenwashing.
• 1:21
  SPEAKER_01: We did touch a bit on some of the regulation coming through to address that.
• 1:25
  SPEAKER_01: Um so maybe uh we could just start, Carlo, with your thoughts on the trust issues that surround this subject.
• 1:33
  SPEAKER_01: Um and and maybe Benji kind of coming to you around really whether you feel like this regulation is going to really help.
• 1:40
  SPEAKER_01: And uh and so let's maybe kick off there, Carlo.
• 1:43
  SPEAKER_00: Yeah, absolutely.
• 1:44
  SPEAKER_00: And it's great to be back for part two.
• 1:46
  SPEAKER_00: Um so look, um, I think yeah, greenwashing is is a it's an important issue, uh, one that we take extremely uh seriously.
• 1:54
  SPEAKER_00: Uh and I think most serious asset managers uh do that, but especially in marketing, you have to be very careful, right?
• 2:00
  SPEAKER_00: Because uh a lot of the time we have a beautiful vision, uh, but maybe that vision doesn't fit with the with the reality.
• 2:05
  SPEAKER_00: So we have to be honest with ourselves.
• 2:07
  SPEAKER_00: But I think one of the tools that we found extremely useful that sort of uh validates it is actually using um uh NGOs or third-party uh associations, which can basically certify your products.
• 2:21
  SPEAKER_00: Uh so these are uh commonly referred to as ESG labeling agencies.
• 2:25
  SPEAKER_00: Um, there's many uh across Europe.
• 2:27
  SPEAKER_00: We particularly work with uh uh the one in Germany is called FNG.
• 2:31
  SPEAKER_00: Uh in Belgium, it's towards sustainability.
• 2:34
  SPEAKER_00: In France, it's ISR for the French or SRI uh in English.
• 2:38
  SPEAKER_00: So those are our three main uh labeling agents.
• 2:40
  SPEAKER_00: Also here in Luxembourg, uh where I'm uh dialing in from, uh, we have LuxFlag.
• 2:44
  SPEAKER_00: So you have different organizations and according to their requirements, some are more just about transparency.
• 2:50
  SPEAKER_00: So is the documentation available to the clients?
• 2:53
  SPEAKER_00: Others are more uh in-depth and detailed where you have to have certain criteria.
• 2:58
  SPEAKER_00: And this is where if you have a good RI team and portfolio manager team, you've already built up your responsible investment policies, i.e., you know, um what is your maximum limit of revenues from a tobacco company?
• 3:08
  SPEAKER_00: What are uh the industries that you exclude?
• 3:10
  SPEAKER_00: Uh uh, what is your policy on um uh human rights, et cetera, et cetera.
• 3:15
  SPEAKER_00: So, so by by it's it and I put a uh disclaimer that it's a lot of work.
• 3:20
  SPEAKER_00: Um, I have a fantastic team and one of my uh teammates, uh, she's responsible for coordinating and doing that, but you're you're coordinating between investments, operations, because sometimes you have to put implementation for monitoring because these associations require some, you know, which is good, some um transparency and accounting, you know, to say, hey, if you say you're doing this, prove it.
• 3:40
  SPEAKER_00: And so around this work, in the end, this is one of the ways you can mitigate uh greenwashing by having that third party.
• 3:47
  SPEAKER_00: Now, our hope, uh, or let's say my personal hope is that the EU will eventually uh launch its uh unifying echo label uh where it'll be one agency where you can apply for it and get certified so that we don't have disparity.
• 3:59
  SPEAKER_00: Now, the agencies between these countries try to work together, but they have their different requirements.
• 4:04
  SPEAKER_00: And so sometimes it can be a little bit challenging.
• 4:06
  SPEAKER_00: But I think it's just one way in which you can do it in order to avoid greenwashing.
• 4:11
  SPEAKER_00: And also finally, more on the commercial, let's say business side, it's also sometimes a business opportunity.
• 4:17
  SPEAKER_00: Some um uh, let's say distributors now require that you have a label in order for you to be on their platform to sell the products.
• 4:24
  SPEAKER_00: So if you're not there, you might be missing on an opportunity, or let's say you're delaying when they can invest in your products.
• 4:31
  SPEAKER_00: So it's it's quite quite interesting, but I think that's what we're doing here at Nodea to tackle uh greenwashing.
• 4:37
  SPEAKER_02: I think that um that last point, Carlo, is when it will become really stark for businesses, won't it?
• 4:44
  SPEAKER_02: If you can't get on the RFP list, if you can't get on the platform because you don't have the necessarily tick box credentials, whatever it may be, that's when CEOs and distribution heads are suddenly start going to go, oh, this is a this is a major problem.
• 4:57
  SPEAKER_02: Um can I quickly ask, because you you are you you referred to your RI team there, and it's something that I think we have seen with clients over the years that they they maybe struggle where the RI teams either don't have enough resource or just aren't given the authority and the teeth, if you like, to be able to go toe-to-toe with the farm managers to set rules, to set the way that things will be done.
• 5:23
  SPEAKER_02: I it sounds like that's obviously not an issue that you have at Nordair, but is that something that's evolved over time?
• 5:29
  SPEAKER_02: And do you have any thoughts or advice for how others might deal with it?
• 5:33
  SPEAKER_00: So I think that first of all, fantastic question.
• 5:36
  SPEAKER_00: Really happy uh that you brought that one up.
• 5:38
  SPEAKER_00: Um, yeah, we've been doing that actually almost since the beginning of when we started launching our our our uh ESG uh products.
• 5:45
  SPEAKER_00: And and the way we do it, and it works quite nicely, is we actually have so first of all, our ESG team is quite big.
• 5:51
  SPEAKER_00: Uh and when I mean big, we're 18, but they're 18 analysts that are fully dedicated to ESG.
• 5:57
  SPEAKER_00: I think that's really important because you might get other houses that say they have 200, 300, but you know, then they're including, you know, everyone from compliance and legal, et cetera, et cetera.
• 6:07
  SPEAKER_00: Here we're talking in facts, and here we're talking about real uh ESG.
• 6:10
  SPEAKER_00: And I think on the European level, I think we have a fantastic team, and we've been recognized uh for that.
• 6:15
  SPEAKER_00: Now, those members of that team, the analysts are also integrated in the team of the portfolio managers.
• 6:21
  SPEAKER_00: So you will have an ESG analyst sitting with the investment team, taking part in the daily meetings and decisions.
• 6:27
  SPEAKER_00: They can bring ideas to the table.
• 6:29
  SPEAKER_00: So it's it's from the moment idea generation takes place where we have the two teams as one.
• 6:34
  SPEAKER_00: I call it ESG integration, I call it one team.
• 6:37
  SPEAKER_00: I don't, we don't look at it as two teams.
• 6:39
  SPEAKER_00: Now, of course, you might have a portfolio manager that says, hey, look at this company, uh, it's so attractive, but they should never get to the decision point where they haven't done their homework.
• 6:48
  SPEAKER_00: So if they don't qualify for our ESG criteria, if they're not living to our ESG values, they should never get to that end where the portfolio manager and then an ESG analyst say, hey, we have a we have an issue here.
• 6:59
  SPEAKER_00: It should be pretty clear uh alignment.
• 7:02
  SPEAKER_00: So I think that's getting easier.
• 7:04
  SPEAKER_00: Now, uh, when we talk about investment teams uh being brought up the speed or the thinking around ESG, I think that's been a normal journey, right?
• 7:14
  SPEAKER_00: A lot of these uh portfolio managers or analysts were around at a time before this sort of field really existed or was incorporated in ESG.
• 7:21
  SPEAKER_00: So that, yeah, that took a little bit of time.
• 7:23
  SPEAKER_00: But now they speak all the same lingo.
• 7:25
  SPEAKER_00: When we have engagements, it's not just the ESG specialist that goes out in the world to visit the company, it's the both of them.
• 7:31
  SPEAKER_00: And if maybe one or the other can't attend, they bring the issues to the table.
• 7:35
  SPEAKER_00: But most of the issues now are so intertwined that it's very it's almost blurred the line, which is fantastic, which is what exactly we want to see.
• 7:42
  SPEAKER_00: Now, if in an organization they're still siloed, or as you say, if one is I I won't use the word uh um bossing the other one around, but you know, if if they're not getting an equal weighting on your side, that that's a that's a problem because at the at the end of the day, there will be a risk where a ESG risk might not have been considered uh or respected fully, and then down the line, you're just gonna you're gonna pay for it.
• 8:09
  SPEAKER_00: Uh one quick example, if I may, uh is Facebook.
• 8:13
  SPEAKER_00: Um Facebook, everybody knows it, lots of people use it.
• 8:17
  SPEAKER_00: Uh, and back in 2016, I want to say, was when we had the Cambridge Analytica scandal.
• 8:23
  SPEAKER_00: Um at that time, um, the uh let's say the FANG stocks, right?
• 8:28
  SPEAKER_00: So Facebook, Amazon, Netflix, and Google, they were driving the market like crazy.
• 8:32
  SPEAKER_00: So this is a good company to have in your portfolio, and we had it in our portfolio.
• 8:36
  SPEAKER_00: Once Cambridge Analytica came out, we immediately reacted, tried to engage with Facebook, tried to uh you know, say, hey, this data governance is not really what we like, and had a conversation.
• 8:46
  SPEAKER_00: And we weren't convinced it happens.
• 8:48
  SPEAKER_00: Uh, so we decided to quarantine Facebook, so we didn't add any investments.
• 8:51
  SPEAKER_00: We tried to continue to engage with them, still didn't get anything, so we decided to sell them.
• 8:56
  SPEAKER_00: Now that was a pretty bold decision, uh, one that maybe most portfolio managers wouldn't have wanted to do because it was giving a lot of good return.
• 9:05
  SPEAKER_00: But we did it, and now we were lucky in that instance because then a few weeks later the stock price dropped considerably because their scandal got worse.
• 9:12
  SPEAKER_00: So we were able to, you know, got the return we got out of that investment and also be, you know, faithful to our investment attribution.
• 9:20
  SPEAKER_00: Now, a good ESG team, so I'm including investments and uh the the ESG team, a good team will always be able to find an alternative within that sector.
• 9:30
  SPEAKER_00: Because sometimes people make it seem like it's live or die.
• 9:33
  SPEAKER_00: There's plenty of companies out there in order for you to still live by your values and generate returns.
• 9:38
  SPEAKER_00: And I think if you get that in your in your, let's say your mix, then you're on a good path.
• 9:42
  SPEAKER_00: And if not, then uh yeah, you probably won't survive too long in that game.
• 9:47
  SPEAKER_02: Facebook's a really problematic stock, isn't it, in so many ways.
• 9:51
  SPEAKER_02: When you think of its social impact longer term and and actually its environmental impact as term as well, because I heard a brilliant start the other day, Twink, which was that data centers globally now consume 2% of the world's electricity.
• 10:07
  SPEAKER_02: So they have the carbon footprint equivalent to the entire airline industry.
• 10:12
  SPEAKER_02: The the scale of these businesses and their impact is is extraordinary.
• 10:17
  SPEAKER_01: There you both go with your storytelling.
• 10:18
  SPEAKER_01: I'm loving this as a marketeer.
• 10:20
  SPEAKER_01: It's brilliant.
• 10:22
  SPEAKER_01: Um but I I mean I certainly see it being a it's it can be a difficult situation where you have a starman culture as a as a as an asset management company that um unfortunately still it can feel optional to listen to the RI team.
• 10:41
  SPEAKER_01: And um I think that's where you know we we find find it hard to sort of really get to that.
• 10:48
  SPEAKER_00: But I think if if I may, very briefly, it comes from the top.
• 10:52
  SPEAKER_00: So if you have a CEO, if you have a group senior management that's committed to that journey and it's part of your vision and mission, that star manager is not gonna have a very long future uh in that position because it's sort of you adopt or you die uh in that situation.
• 11:06
  SPEAKER_00: So I think a lot of them are are getting to let's say it's it's not an issue where we are, but it I think in other organizations, if you really want to go down that route, you you gotta look yourself in the mirror and say, okay, is this the organization I want to be with?
• 11:19
  SPEAKER_00: Or maybe I go to another shop uh and that's fine too.
• 11:21
  SPEAKER_00: It's not it's not a must-have, but you can't be in an organization that says you're committed to doing ESG and then have the the A-star manager that doesn't live up to those values.
• 11:31
  SPEAKER_00: It just doesn't work.
• 11:32
  SPEAKER_01: Well, this is the rub, right?
• 11:34
  SPEAKER_01: Because you could you could be in a situation where you've got you know a few of your key strategies are kind of you know run by kind of very prolific individuals with that star mind culture.
• 11:44
  SPEAKER_01: So I guess my next question would be then for your kind of commercially minded CEO who's looking at the market opportunity, you know, as you rightly point to the kind of PWC piece, you know, they they recognize it's a space they want to be in, but you know, perhaps, you know, how how can they be balancing this all up when they maybe don't have or able to commit to all that's required, as you've sort of eloquently pointed to and talked to in part one of this, you know, to really be authentic in this space, the kind of the resources you know, from the ground up, really to sort of be a leader in this space.
• 12:21
  SPEAKER_01: How how do you think um, or do you think it's pretty it's pretty clear what the CEO needs to do?
• 12:28
  SPEAKER_01: But you know, you can kind of see that being a very difficult situation where they've got a legacy book, there there's a sort of opportunity ahead, they've got to pivot somehow strategically.
• 12:37
  SPEAKER_01: There's a big resource requirement that's you know, they're gonna, you know, that that's kind of makes it a very difficult decision and transition potentially.
• 12:45
  SPEAKER_00: Well, there's there's several different steps andor answers to your question.
• 12:48
  SPEAKER_00: One is is it comes always down to well, what is your business, right?
• 12:53
  SPEAKER_00: So if you're working with like we do with many distributors around or even institutional investors like pension funds, at least in Europe, you know the demand or the or the move is towards that, right?
• 13:02
  SPEAKER_00: So you have to align your business to what your client wants.
• 13:05
  SPEAKER_00: Uh it's similar kind of like what we're discussing before, if you want, about fossil fuel industry, right?
• 13:09
  SPEAKER_00: So those companies, either they adapt or they die.
• 13:12
  SPEAKER_00: Either they change, you know, stop burning coal or maybe reduce nuclear or whatever and go towards clean energy, whether it's uh solar or uh whatever, they're not going to exist.
• 13:22
  SPEAKER_00: So they've made a clear conscious decision, right?
• 13:24
  SPEAKER_00: These industries, some of them, right, to transform their business and then they will be there in the future.
• 13:29
  SPEAKER_00: It's the same thing in the asset management industry.
• 13:31
  SPEAKER_00: We see a clear trend line in Europe again that people want more ESG products.
• 13:37
  SPEAKER_00: Now, I think uh uh a good CEO will take the time to see how do I bring my business there?
• 13:43
  SPEAKER_00: It doesn't have to happen overnight.
• 13:45
  SPEAKER_00: If your book, as you say, is diversified, you don't force them to change it overnight.
• 13:49
  SPEAKER_00: And also you do an analysis and you're honest with your clients.
• 13:51
  SPEAKER_00: Does my book changing to ESG make sense?
• 13:54
  SPEAKER_00: I mean, when I talk about, for example, we have a huge book on cover bonds.
• 13:58
  SPEAKER_00: Cover bonds are not really an ESG sort of area.
• 14:01
  SPEAKER_00: Uh yeah, you could you can always tie it and go down to the nitty-gritty, but at the end of the day, they're very safe.
• 14:07
  SPEAKER_00: Loans guaranteed, uh so you know, to call it ESG or not, you know, you can add that process in that.
• 14:13
  SPEAKER_00: And I think we're looking at that, and and it could be value adding, but maybe I wouldn't spend my time there.
• 14:18
  SPEAKER_00: Where we need to spend time is sort of like what we've done is, for example, our whole equity book, so our fundamental equities team that run all these strategies, now it's all ESG.
• 14:27
  SPEAKER_00: So they just be, you know, we decided strategically made sense, and also uh we have a strong belief with it.
• 14:33
  SPEAKER_00: So we transitioned to that, and we're very happy to do that because we think it's strategically and also, let's say fundamentally, part of the investment process now.
• 14:42
  SPEAKER_00: And so we we made that decision.
• 14:44
  SPEAKER_00: So I think it's a matter of you know what you as an organization want to do, but a lot of that will be determined, as in many businesses, what your end user wants, your client.
• 14:52
  SPEAKER_00: And if you don't listen to them, then yeah, well, we know what happens generally to those businesses.
• 14:57
  SPEAKER_01: So, Benji, um, maybe come to you for this one.
• 15:00
  SPEAKER_01: How do you, if for our listeners kind of picking through this and and trying to help their businesses articulate a story, a positioning, how how can they help their businesses be more authentic in this space?
• 15:14
  SPEAKER_01: Do you think?
• 15:15
  SPEAKER_01: Quite a tough question, but over to you.
• 15:17
  SPEAKER_02: It's a tough question, thanks.
• 15:19
  SPEAKER_02: Um it's it has a number of components to it.
• 15:23
  SPEAKER_02: I think a lot of what Carla has just alluded to is important.
• 15:29
  SPEAKER_02: That authenticity has to come from the top down.
• 15:31
  SPEAKER_02: But I think brand is a hugely underrated term in this scenario, where a lot of the industry is still guilty of thinking as brand being a logo and something quite tactical.
• 15:45
  SPEAKER_02: But your brand fundamentally is at the heart of everything you do.
• 15:49
  SPEAKER_02: It's what defines you, it's how you talk about yourselves, how you engage people internally, externally.
• 15:55
  SPEAKER_02: If you get that right and you generally are talking about what you do authentically, then it becomes a lot easier.
• 16:04
  SPEAKER_02: And then you don't look at ESG and everything in the sort of negative context of either falling foul or not being part of it, or not, you know, it's it's about it's just an endorsement and then a continuing reaffirmation of what you do as a business.
• 16:21
  SPEAKER_02: And that's what we keep hearing clearly from investors that they want honesty.
• 16:26
  SPEAKER_02: I wouldn't, I don't want promises to be made.
• 16:29
  SPEAKER_02: ESG is built on trust and credibility.
• 16:31
  SPEAKER_02: So if your brand doesn't demonstrate that, how do how do I do anything about it?
• 16:36
  SPEAKER_02: And then the other side of the authenticity, I think, is going back to storytelling.
• 16:42
  SPEAKER_02: People don't want to just be told what you do, they want to be shown what you do.
• 16:46
  SPEAKER_02: And when you talk about ESG integration, they don't want to just see those same slides that talk about how you integrate governance.
• 16:53
  SPEAKER_02: They want to hear the stories that talk about the and about the yes and about the great things you're doing.
• 16:59
  SPEAKER_02: And I think what marketers do have up their sleeve right now is the array of data points and the array of things that you can draw on to create amazing stories.
• 17:09
  SPEAKER_02: Some of the stats are horrifying and really negative, but you can use them in a stark way.
• 17:14
  SPEAKER_02: And other of them are incredibly encouraging and positive.
• 17:17
  SPEAKER_02: At the same time as that point around data centers, I heard that every$1,000 invested into renewable green energy bond projects now generates 500 kilograms reduction in CO2 emissions.
• 17:30
  SPEAKER_02: These are really powerful things.
• 17:32
  SPEAKER_02: The sustainable funds market in Europe has now hit 800 billion in Q3 this year against the backdrop of the pandemic and the convergence and everything.
• 17:40
  SPEAKER_02: So there are such powerful, such tangible stats that you can create great stories around.
• 17:46
  SPEAKER_02: But that authenticity, I think, has to start with your brand and being and looking inward as to what genuinely makes us us and what type of business do we want to be.
• 17:55
  SPEAKER_01: And actually, if I may then just jump in on the sort of brand point.
• 17:58
  SPEAKER_02: Um Thank goodness, because you're quietly more qualified to talk about it than me.
• 18:03
  SPEAKER_01: Well, I was talking to a company the other day who who is also you know brilliant in this space.
• 18:10
  SPEAKER_01: Um, and their view was they're trying to articulate and think about their differentiation in kind of three to five years' time, and it doesn't talk about sustainability or ESG in that regard because they just they believe it will be omnipresent.
• 18:26
  SPEAKER_01: It will be in every single asset manager's toolkit.
• 18:29
  SPEAKER_01: And so it's interesting, you know, the evolution that this is taking and the journey the asset management industry is on as a whole.
• 18:38
  SPEAKER_01: And I just uh based on that, um, Carla, I'd love your perspective on that as to sort of, you know, whether you believe that to be true, that that um you will find that you are increasingly in an authentic, well-evident space alongside your peers, um, and and where you think brand can play a role.
• 18:56
  SPEAKER_00: So I I think that's it's a possibility, let's put it that way, uh, that in three to five years we'll be there.
• 19:01
  SPEAKER_00: Um, I can't really honestly answer yes or no.
• 19:05
  SPEAKER_00: Um because things are moving fast, but it's also it also will be well, what what what will we consider acceptable?
• 19:11
  SPEAKER_00: Uh because yeah, it'll be integrated.
• 19:13
  SPEAKER_00: Uh yeah, people will be more aware of it, but will it really be what we want it to be?
• 19:18
  SPEAKER_00: Uh and that I'm not sure.
• 19:19
  SPEAKER_00: Uh, because the more let's say uh people or let's say asset managers and companies join this space, you know, there's gonna have to be some policing of what's happening.
• 19:29
  SPEAKER_00: Otherwise, uh I I would hope, as us being in this space for a very long time, that we don't settle for less than where we began.
• 19:37
  SPEAKER_00: Uh so that's that's my my viewpoint.
• 19:40
  SPEAKER_00: Um as an asset manager for our brand, it's extremely important and we're gonna continue to invest heavily uh in ESG, uh, not because of you know commercial sense, but also because it's something that's really it's really in our DNA.
• 19:52
  SPEAKER_00: So I know that's a cliche and it's very used, but it's something that I I really, I really truly uh believe.
• 19:58
  SPEAKER_00: Um and maybe going back to to what when what Benji was just saying a few minutes ago, I just had a flashback uh because a few more weeks ago we were working on branding for our gender diversity fund.
• 20:07
  SPEAKER_00: And so we're working on a team on the claim, right?
• 20:09
  SPEAKER_00: So how do we make it so people understand it?
• 20:11
  SPEAKER_00: And and this is, I think, interesting for the marketeer uh part of you, right?
• 20:15
  SPEAKER_00: Because this is where you really can make the difference, right?
• 20:17
  SPEAKER_00: In a few words, you can set the tone of the product.
• 20:20
  SPEAKER_00: And and we as marketeers always have the challenge that we're we're selling to two diverse groups at the same time.
• 20:26
  SPEAKER_00: We're selling maybe to an institutional investor, but maybe also to an advisor that'll have a retail client.
• 20:31
  SPEAKER_00: So then maybe you have a more um emotional component on one end, and maybe you have a more data clear, uh evidence-based uh client on the other end.
• 20:39
  SPEAKER_00: And then also they could switch.
• 20:40
  SPEAKER_00: I don't want to make it seem uh it's it's universal.
• 20:43
  SPEAKER_00: And we came up with the claim at the end, you know, gender diversity dot, it matters.
• 20:48
  SPEAKER_00: And I thought it was very elegant.
• 20:50
  SPEAKER_00: Maybe you guys like it, maybe you don't, but I thought it was elegant because we wanted to evidence the fact that yes, gender diversity in companies matters because we've seen in studies the more diversity you have, the better returns.
• 20:59
  SPEAKER_00: But also from a financial point of view, it matters.
• 21:02
  SPEAKER_00: So we were able to play both the ESG aspect of it and also the financial aspect of it.
• 21:06
  SPEAKER_00: And I thought it was really nice tied in, uh uh sort of in a bow sort of way to start marketing that.
• 21:12
  SPEAKER_00: And I think that's where branding, that's where the marketeer makes it's not, you know, sometimes I think uh, and depending on I'm I'm lucky to be an organization where marketing is viewed as an essential component alongside the sales.
• 21:23
  SPEAKER_00: And maybe some people are not in those type of organizations.
• 21:26
  SPEAKER_00: And what I would say to those marketeers is don't give up because your voice doesn't matter, your input matters, because at the end of the day, what reaches your clients' hands is those words, it's those images, it's that presentation.
• 21:37
  SPEAKER_00: So if you're not an organization that supports that yet, maybe you can be that person that helps them get there.
• 21:43
  SPEAKER_00: And if they don't want to get there, then maybe you should be looking somewhere else uh to go to.
• 21:48
  SPEAKER_00: But but it plays a tremendous, tremendous uh uh role.
• 21:51
  SPEAKER_00: Even if sometimes I know our biggest challenge is we can't always quantify it uh in in a let's say traditional sense.
• 21:57
  SPEAKER_00: But the assets are there.
• 21:59
  SPEAKER_00: So Some way somewhere along the line it's quantifiable.
• 22:02
  SPEAKER_01: Awesome.
• 22:03
  SPEAKER_01: I could not have put any of that better myself.
• 22:04
  SPEAKER_01: I was going to say Mark is going to be in the room to influence, and uh you can very eloquently um talk to that.
• 22:10
  SPEAKER_01: So uh yeah, hurrah to that, I'd say.
• 22:14
  SPEAKER_01: Um just I I before we kind of wrap up the session session, I I'd quite like just to talk to the reporting aspects, the transparency elements, um, because we we talked a bit to the data points, and and it feels like sometimes that could be quite hard, you know, sort of really bringing that alive.
• 22:34
  SPEAKER_01: And I think um, I know that you've done quite a bit of work on the reporting side, Carla, in that regard, but I wonder whether maybe we start with Benji and we kind of you can kind of give your view there on sort of how you're seeing practice developed there, and then Carla, you can be quite specific about what you're doing in this space.
• 22:49
  SPEAKER_02: I think um from a reporting perspective, it goes back a little bit to the data discussion we were having.
• 22:57
  SPEAKER_02: I think the availability of data is allowing you to enrich your reporting in a way that might have been difficult previously.
• 23:05
  SPEAKER_02: So we are seeing, hallelujah, fact sheets evolve from being this bland commentary with the performance in the last six months and a multitude of risk ratings to being able to demonstrate genuinely interesting things about the carbon footprint of the funds.
• 23:20
  SPEAKER_02: And you just talked about gender diversity, uh, Carla, about the gender balance makeup of the companies you invested in.
• 23:25
  SPEAKER_02: Things like this, I think, are bringing richness of reporting in a way that makes them engaging and communicative.
• 23:32
  SPEAKER_02: And so having that data at a marketer's fingertips is crucial.
• 23:37
  SPEAKER_02: What coronavirus has done, to the risk of using the dreaded word, is that it also has pushed so much of business development into marketing's funnel.
• 23:47
  SPEAKER_02: The engaging with people remotely and through digital channels means that that can be reported on in a way that probably was difficult historically when you had a very traditional sales funnel and a very traditional way of doing things.
• 24:00
  SPEAKER_02: So you add the being able to assess the funnel progress and the stats along the way with some of the really enriching stuff that you can bring to the party.
• 24:10
  SPEAKER_02: And I think reporting suddenly becomes a thing to be proud of and not necessarily just a chore as a business.
• 24:17
  SPEAKER_02: Um, but I suspect uh Carlo can sort of talk more eloquently about directly how you do it at Nodea.
• 24:23
  SPEAKER_00: And and um I think what I also maybe want to just bring uh to the conversation very quickly is that uh not to out to say our solutions, but I think overall challenges, I think it's important to also remember is okay, there's lack of consistency uh at the moment.
• 24:37
  SPEAKER_00: And I think that's an issue we need to address as a as an industry.
• 24:39
  SPEAKER_00: So we need to find a common framework.
• 24:41
  SPEAKER_00: Um, receiving the information in a timely fashion is also uh and reliable.
• 24:46
  SPEAKER_00: Uh lack of convergence in terms of coverage and also comparison, being able to compare apples to apples, that's still a major uh issue in our industry.
• 24:55
  SPEAKER_00: And uh obviously these are things that that we are continue to battle with.
• 24:59
  SPEAKER_00: So now when I give you my solutions, I I think I need, and everybody needs to be transparent that it's I don't want it to seem like everything is la di da uh and that we do a great, we do a fantastic job, which by the way we do, but uh but there are issues uh that we have uh as any asset manager.
• 25:14
  SPEAKER_00: Now, what have we done?
• 25:15
  SPEAKER_00: Well, we've partnered up with um a fintech uh company called uh um matters, uh, and they've done an agreement with NASDAQ, and they've helped us build uh impact reports.
• 25:26
  SPEAKER_00: So sustainability, your how your investments impact different uh um ESGs.
• 25:32
  SPEAKER_00: So we have environmental factors, social and governance factors.
• 25:35
  SPEAKER_00: And then that's been a really great success because we've been able to roll that out, and so finally we're able to show in a quantifiable, easy to understand, visually uh uh way to our clients how their investments make a difference.
• 25:48
  SPEAKER_00: Uh, and so that's been one way.
• 25:50
  SPEAKER_00: For the institutional space, we've developed a uh sustainability and engagement report.
• 25:55
  SPEAKER_00: It's a little bit more sophisticated.
• 25:57
  SPEAKER_00: Uh, we use a platform called ISS, ESG.
• 26:00
  SPEAKER_00: And basically what we do is we measure the sustainable development goals, some social objectives, environmental objectives.
• 26:06
  SPEAKER_00: We take them and we will basically weight them and the contribution.
• 26:09
  SPEAKER_00: And so we can actually show in a quantifiable way again, objectively, because it's a third-party data source that we're using.
• 26:15
  SPEAKER_00: So we're using their source in order to then show the impact how we measure in different uh SDGs.
• 26:20
  SPEAKER_00: So we've had to, I mean, we've set this up already now for two years ago.
• 26:24
  SPEAKER_00: So I think we we moved pretty pretty early, but it was a lot of work.
• 26:28
  SPEAKER_00: Uh more recently, we finally started getting in the fixed income space, which has been one of the hardest uh spaces to be able to do these types of reporting.
• 26:36
  SPEAKER_00: And so now we're also being able to generate these uh reports uh for for that space.
• 26:40
  SPEAKER_00: So uh my my let's say um suggestion to to marketeers or organizations uh that are thinking about going into the space, you need to be really well organized.
• 26:50
  SPEAKER_00: Your your operations needs to be on board, your your product office needs to be on board, your marketing, it's it's a really it's a multi-tiered collaboration, but it's it's it's exactly what clients are demanding, it's what clients need.
• 27:02
  SPEAKER_00: So it's it's it's um it's a must-have, basically.
• 27:07
  SPEAKER_01: And how your how your marketing colleagues dealing with the increasing demand within the company to demonstrate kind of the measurement and the ROI against sort of ESG-related campaigns or or uh initiatives, because that's certainly uh something that we hear more broadly that you know we want to be known for you know our credentials and sustainability.
• 27:33
  SPEAKER_01: So we're gonna drive this campaign and we're gonna put this across our branding, and and we've got to demonstrate kind of the ROI on that.
• 27:41
  SPEAKER_01: You know, how how do you deal with that?
• 27:43
  SPEAKER_00: So so my secret, maybe it won't be it won't be uh I don't think it's a secret, but my my suggestion is your number one branding campaign is your sales team.
• 27:56
  SPEAKER_00: Uh because again, we're a B2B business.
• 27:58
  SPEAKER_00: So I mean I could take out an ad in the Financial Times, I can do a LinkedIn campaign, magazines, advertori, and they will have impact because it'll get to their space.
• 28:07
  SPEAKER_00: But the real key support in order to be successful, in my humble opinion, is arming your sales force with the right content and material.
• 28:16
  SPEAKER_00: So when they go visit their clients, they basically sell the product.
• 28:19
  SPEAKER_00: And we've seen the, I mean, the the the I think all asset managers went to a digital transformation in the last uh uh uh 11 months, whereby before nobody knew what Zoom was, nobody knew what a camera, video, video camera was, uh, et cetera, et cetera.
• 28:33
  SPEAKER_00: And now we're doing Zoom calls, uh, whatever, blue jeans or whatever, WebEx, and you're sitting in front of the clients and you're basically presenting, and you have to think of an interesting and dynamic way to do that.
• 28:43
  SPEAKER_00: So, how do you get visuals up on the screen?
• 28:45
  SPEAKER_00: How do you make presentations interesting?
• 28:47
  SPEAKER_00: Those have a real impact.
• 28:50
  SPEAKER_00: You have uh people doing videos, you know, product videos that they can send out to send to the networks, etc.
• 28:55
  SPEAKER_00: Those are way more powerful in my opinion, because at the end of the day, you're providing a service, whether it's a product update, whether it's uh education or whatever to your direct client.
• 29:04
  SPEAKER_00: And that I think has a an immediate impact.
• 29:07
  SPEAKER_00: Now, maybe it's not scientifically proven, but our sales uh numbers have been very good this year.
• 29:13
  SPEAKER_00: So I think the effort from our marketing and our sales and the whole organization has been quite good.
• 29:18
  SPEAKER_00: Now, going on to the more traditional marketing sense, uh, I still think there's still a challenge to see, to be honest, the real uh the real data uh in terms of if it's quantifiable or not.
• 29:30
  SPEAKER_00: Um we we work with um uh good agency in the UK that does our European campaigns and and whatnot.
• 29:36
  SPEAKER_00: And and they showed us the numbers, but at the end of the day, uh also because of GDPR challenges and being able to really sift through that data, it makes it sometimes really challenging to be able to quantify that.
• 29:47
  SPEAKER_00: So I think other uh marketeers will probably um let's say uh it'll sound familiar uh to to them, but I say concentrate on where you what you can control uh first.
• 29:59
  SPEAKER_00: And then on the other side, of course, part of a good balanced marketing mix, obviously you'll have that uh to support you.
• 30:04
  SPEAKER_01: Okay, thank you.
• 30:05
  SPEAKER_01: Um so as we sort of look to to close this conversation, I guess um a couple of questions um to put in your minds.
• 30:15
  SPEAKER_01: One, just sort of with your crystal ball in hand, where to next do you think for uh this space or sustainability or ESG, whichever we're gonna um sort of talk to?
• 30:27
  SPEAKER_01: So just how you see the market evolving, um, maybe Benji, and then kind of specifically where you're focusing, uh Nodea, um, and maybe in your answers you can just wrap up any other final thoughts for our listeners, um, you know, uh give with a sort of specific marketing hat on.
• 30:44
  SPEAKER_02: I think from from our perspective, and and probably more with a marketing hat on, that this is a really evolving space and it's evolving fast.
• 30:54
  SPEAKER_02: And it is likely that the end point that everyone sort of has in mind at the moment is going to change from here.
• 31:01
  SPEAKER_02: So, some of what you're doing is laying the foundations and the groundwork for whatever that next evolution is, but you can't do the next evolution authentically unless you've got some of the tools and the building blocks right at this stage.
• 31:14
  SPEAKER_02: So I think there's a lot for people to be thinking about.
• 31:18
  SPEAKER_02: Um, we are, I think the evolution that we will see will be more of a focus on the clients and what do they want and what do they need.
• 31:28
  SPEAKER_02: And that can that can only be a good thing.
• 31:30
  SPEAKER_02: And and linked to that, and I think it's something that's difficult for the asset managers and potentially easier for the wealth managers and private banking and beyond, is this idea of personalization, because that's happening in every other industry under the sun, isn't it?
• 31:44
  SPEAKER_02: But it is so hard for the asset managers to build products at scale that are personalized.
• 31:50
  SPEAKER_02: And I think that creates a real opportunity for people down the value chain and in who are who perhaps have the direct relationship with clients and clients, who will be thinking about how to personalize products in accordance with their goals and ambitions.
• 32:04
  SPEAKER_02: And can you create different model portfolios and buckets of funds that aren't ranked on just risk, but on other types of preferences and how will that world evolve?
• 32:15
  SPEAKER_02: And I think that will be fascinating when clients can start to look and choose investments based on a wider set of preferences than than were available historically.
• 32:25
  SPEAKER_01: Brilliant.
• 32:26
  SPEAKER_01: Thank you.
• 32:27
  SPEAKER_01: Carde, final words to you.
• 32:29
  SPEAKER_00: So I I'm gonna go really big here.
• 32:32
  SPEAKER_00: So I'm gonna say we're gonna have a vaccine for COVID soon and that things will return back to normal in 2021.
• 32:39
  SPEAKER_00: But why I mentioned that is I think the way we've consumed uh content will not change so much.
• 32:45
  SPEAKER_00: I think we've had some important lessons this year, and I think the focus should be in the future, especially on the digital side.
• 32:51
  SPEAKER_00: Um, I actually um I'm fortunate enough here to be the brand ambassador for Node today, but I have my better half, uh Andrea, who runs the marketing communication team.
• 32:59
  SPEAKER_00: So she's responsible for digital uh and design, and so she's really the star behind a lot of the stuff I get to show off.
• 33:06
  SPEAKER_00: And I think we're gonna be really uh focusing a lot more on digital, uh the way you consume uh content.
• 33:12
  SPEAKER_00: Uh I think we've seen that you know attention span is short.
• 33:15
  SPEAKER_00: I think uh one thing we have to get better is now everyone's sitting home.
• 33:18
  SPEAKER_00: So what do we do?
• 33:19
  SPEAKER_00: Well, we send them a thousand invitations, and a thousand invitations get irritating.
• 33:23
  SPEAKER_00: So we're gonna have to also do uh uh an autopsy, if you will, of best practices now uh because I'm sure we've made some mistakes, I'm sure we made some improvements.
• 33:31
  SPEAKER_00: But you know, we and we what we found out is that in an emergent situation, we were able to rise to the occasion.
• 33:36
  SPEAKER_00: We built a dedicated microsite investments related to COVID.
• 33:39
  SPEAKER_00: We did we set we started a brand new um uh product series for our clients weekly, where we hosted it live.
• 33:45
  SPEAKER_00: Uh we created all brands, new types of content.
• 33:47
  SPEAKER_00: And I think that's where you, as marketeers, uh we as marketeers, rather, I should say, need to focus our time uh is to say, okay, well, what lessons learned do we have?
• 33:56
  SPEAKER_00: I think in terms of products for the future, um, and I think Benji, you you hit the nail on the head on this one.
• 34:01
  SPEAKER_00: I think impact investing is the next frontier uh in in in ESG products.
• 34:05
  SPEAKER_00: I think right now we we're doing sort of the the good housekeeping uh in sense of integrating ESG into our investment portfolios, et cetera, et cetera.
• 34:14
  SPEAKER_00: But now, if if we have that wealth transition that we were discussing before, these millennia, they're gonna want a little bit more.
• 34:19
  SPEAKER_00: They're gonna want to know how am I making this world a better place?
• 34:22
  SPEAKER_00: Uh, not to not to be be cliche.
• 34:24
  SPEAKER_00: So we as an industry, maybe it won't be in the next three to five years, but definitely in the future, we got to wrap our heads around that because these are the way uh they're gonna consume.
• 34:32
  SPEAKER_00: And also, again, going back to digital, there's gonna be a younger and younger generation.
• 34:36
  SPEAKER_00: Um, I like to think of myself as a pretty young, young, young, young gentleman, but I know that every time Apple introduces a new iPhone, I I think I learn less and less of the capabilities of the phone.
• 34:46
  SPEAKER_00: And so I get frustrated and I can only imagine uh what the technological revolution will bring behind us.
• 34:52
  SPEAKER_00: So I think we as providers also have to keep up with the times.
• 34:55
  SPEAKER_00: Uh so I think that we have a lot of homework to do, but also again, maybe some last final thoughts.
• 35:02
  SPEAKER_00: Marketing is a really essential part of any good organization.
• 35:06
  SPEAKER_00: And I think the way we communicate to our clients, we should also think about how we communicate internally.
• 35:13
  SPEAKER_00: Because I think too many times you do a lot of great work or we do a lot of great work, but we don't know how to sell ourselves.
• 35:19
  SPEAKER_00: It's funny, we know how to sell our products outside, but inside an organization, we don't do that.
• 35:23
  SPEAKER_00: I I, as you can tell, have a pretty loud mouth.
• 35:26
  SPEAKER_00: Uh, so I managed to do that.
• 35:28
  SPEAKER_00: But I'm just saying for those uh that don't do it in the organization, make sure to do it because a lot of the time, maybe that sale guy that or woman down that down the down the hall has no idea of the uh fabulous things that you're doing.
• 35:41
  SPEAKER_00: And it only takes a phone call or internal communication and you'll you'll be really successful.
• 35:46
  SPEAKER_00: So just some some some small reflections uh from a from a guy that's been in the biz for a while.
• 35:52
  SPEAKER_01: That's brilliant.
• 35:52
  SPEAKER_01: Thank you.
• 35:53
  SPEAKER_01: Thank you so much.
• 35:54
  SPEAKER_01: And uh to both of you, really.
• 35:56
  SPEAKER_01: I've really, really enjoyed this kind of go anywhere kind of conversation.
• 36:01
  SPEAKER_01: Um and specifically, Carlo, thank you for so generously sharing the sort of Nordair story.
• 36:07
  SPEAKER_01: And I have to find it so heartening hearing you repeatedly, actually, through the last um hour or so, talking about the alignment, the respect, and the influence that clearly marketing has and the relationship that exists across the whole distribution team.
• 36:22
  SPEAKER_01: I think it's really uh heartening, as I say, and and hopefully reassuring for a lot of listeners as to the kind of um role and influence and relationships that they can have.
• 36:31
  SPEAKER_01: So thank you both very, very much for time.
• 36:33
  SPEAKER_01: It's been fantastic.
• 36:35
  SPEAKER_00: Thank you so much.
• 36:36
  SPEAKER_00: Thank you.