Editor’s note: This article is part of a continuing series in which Paul Ellis, a well-known advisor and consultant on sustainable investing strategies, interviews industry professionals on the topics of millennials and sustainable investing. What follows is an interview with two industry experts from Pax World Investments: Christopher Brown, chief investment strategist and Greg Hasevlat, sustainability research analyst. 

To read the first article in the series, click here: /news/the-wise-woman-and-the-millennial-23738.html

Paul: Chris, you’ve been with Pax World Investments since 1998. Prior to that, you worked for a firm that is now part of Oppenheimer.

Chris: That’s right, Paul. But I’m a little biased. My father was one of the founders of Pax World, so I grew up around SRI investing. I went to business school and concentrated on finance at Boston University, but talking to my father about analyzing companies from a sustainable perspective was compelling, and I was interested in doing it myself.

Paul: I didn’t know that! So you grew up with this approach to investing.

Chris: I did. Starting in 1998, I co-managed Pax’s Balanced Fund for four years, then became sole manager and ultimately chief investment strategist. Now, as a portfolio manager, I’m dedicated to the Balanced Fund, which is our largest fund.

Paul: And now you have a millennial working with you.

Chris: We can learn a lot from the millennials. My daughter is in college now. She wanted a Prius for her first car. That was a great lesson for me as a parent that she cares about the future. The world’s resources are finite, and I’m learning about energy efficiency from my daughter.

Paul: Greg, you were working for a consulting firm before you joined Pax World, right?

Greg: Right. Most of what I did was public policy oriented. My firm represented a diverse range of clients before the New Hampshire legislature, from utilities to financial services companies.

I saw some of the public policy advocacy that Julie Gorte, Pax World’s senior vice president of sustainable investing, was doing, and it seemed to line up with what I was doing. I was also impressed that the company was founded before I was born. Obviously, they were doing something right.

Paul: Chris, were you directly involved in the interviewing and hiring process for Greg?

Chris: Yes, that’s something we do here regardless of the department. Members of the portfolio management team get involved in hiring for sustainability research. Likewise, when we hire a new portfolio manager, they get interviewed by sustainability research. We want to see a good fit between the two teams.  

Paul: Greg, have your expectations been met at Pax World?

Greg: Yes, I expected to be involved in the sustainable portfolio construction process and use my public policy training, and both have been met. I’ve been with the firm six years, and I think we’ve done a great job of integrating ESG analysis with financial analysis in our investment process.

Years before I came to Pax World, I read an interview with Chris. It was the first time I heard about sustainable investing, but I don’t think Chris knows he was an early influence on my interest in this field.

Paul: Did you know that, Chris?

Chris: I did not! I just learned that right now.

Paul: Chris, what inspired you about Greg when he interviewed for your team?

Chris: Had I known about the article, it would have been a slam dunk for him! That aside, I always look for someone with strong analytical skills, and Greg certainly articulated that. I was also looking for someone who could understand both the financial and sustainability sides of the role. Greg’s M.B.A. and his previous work on sustainability issues helped, as well as his understanding of the need to integrate the two areas.

Paul: Greg, in your interface with portfolio companies, are you dealing with investor relations or corporate sustainability people?

Greg: It really depends on the company’s size. Intel, for example, has a pretty robust team of sustainability professionals that work with their investor relations team. As you move down the market cap spectrum, you tend to get more responses from investors relations or even communications people.

Paul: Chris, based on your longer tenure in the industry, what can you add to what Greg has said?

Chris: I have a somewhat different take. I see companies embracing this dialogue more seriously over the years. The proliferation of ESG research coming out of mainstream financial firms like UBS, Goldman Sachs and Morgan Stanley is sending a strong message to companies that Wall Street is taking sustainable investing seriously.  

This validates what we’re doing at Pax World and demonstrates to companies that Main Street is incorporating ESG analysis into the investment process. Quite frankly, I use ESG research as a risk management tool. It’s just as important as looking at a company’s return on equity or return on assets.

Paul: Chris, what’s your perspective on how the sustainable and impact-investing field will develop over the next three to five years?

Chris: I see more mainstream firms getting into sustainable research. The mutual fund industry is a maturing industry, but ESG analytics is growing. I also see consolidation within sustainable and impact investment firms down the road and more standardization of the ESG analysis process.

Paul: Greg, what about you?

Greg: A recent U.S. Trust study [the 2013 Insights on Wealth and Worth survey] found 69 percent of millennials see their investments as a way to express their “political, social and environmental values” vs. 36 percent of baby boomers. I think what we’re doing at Pax World is what millennial investors are looking for.

Paul: Greg, when you speak with other millennials in the workplace, what are they saying about sustainability issues?

Greg: A sustainable lifestyle is almost a given for people my age and up to 10 years younger. They expect to buy organic food and drive cars that are fuel efficient. It’s not accurate to say people are talking about sustainable investing a lot, but they are talking about sustainable lifestyle choices. That mindset will lead to people looking for investment opportunities. That’s where the rubber will meet the road and conversations will start to happen with investment advisors.

Paul: Greg, as a millennial and a professional in the investment industry, what do you say to other millennials about career opportunities in this field?

Greg: I get resumes from grad students and folks looking to make a career change. They want to pick my brain about sustainable investing. I tell them a career in sustainable investing is unique, challenging and likely to be more interesting than what most of their friends are doing. It’s at the forefront of what’s next for our industry, the future of asset management and an exciting place to be working.

Chris: I agree with Greg—this is a dynamic industry within a maturing industry. This is where growth is going to be, and I’m excited about that. The lights are turning on for my generation too. People are starting to see that resources are finite, and we need solution-based investments. After driving my daughter’s Prius, my wife decided she wants a hybrid as well, and that’s what I’ll leave you with.  

Paul Ellis founded Paul Ellis Consulting to work with financial advisors who want to integrate sustainable and impact investment strategies for their clients. Chris Brown is chief investment strategist for Pax World Funds and a member of the portfolio management team for the Pax World Balanced Fund. Greg Hasevlat is a sustainability research analyst at Pax World Management LLC and is also assistant portfolio manager of the Pax MSCI International ESG Index Fund.