Editor’s Note: This is the second in a series of articles. To read the first article, click here.
The women leaders interviewed for this series are clear about today's capital market opportunities and risks. They are embracing both as the investment industry transitions toward a low carbon economy with greater emphasis on the economic value of intangible corporate assets and social impact enterprises.
These women are trendsetters and innovators, using their industry experience and leadership platforms to articulate a powerful message regarding the rapid growth in the use of non-financial data to drive investment performance and risk management.
Increase Portfolio Transparency
She is excited about the carbon impact assessment, which is going to launch at the start of Q2 in Morningstar Direct in addition to the sustainability ratings system (“The Globe Ratings”) that launched in 2016. “Both have been developed in conjunction with our ESG research partner, Sustainalytics, to support investors and advisors in their due diligence process for sustainable portfolio construction,” says Svidler.
“Leadership success for me is to understand what role I can play that creates the most leverage in collectively advancing sustainable finance.” Svidler continues, “I feel that my strength is in the ability to identify what would create the biggest impact on sustainable investment growth.” Her goal is broad industry adoption of a more meaningful long-term investment approach that includes ESG factor analysis.
How are these women leaders different from many of the men in financial services with similar experience and credentials? These men also believe that economically sustainable capital market investing is in everyone’s best interest. The difference, I believe, is the perception of investment risk and portfolio impact related to the integration of ESG factors. These women believe there is at least as much risk to sustainable long-term performance in not including ESG factors along with traditional risk and return metrics, a perspective that numerous industry studies in recent years support. Many men believe that ESG factors do not contribute to portfolio performance and investment risk and focus more on traditional risk and return metrics.