Ian Simm on the transition to a more sustainable economy

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  • 03 mins 37 secs

Learning: Unstructured

This film - a 3-minute watch – features Impax Founder and CEO Ian Simm. Ian discusses biodiversity, net zero, and other key themes shaping global markets as we transition to a more sustainable economy.
Channel: Sustainable Investing Hub

Speaker 0:
so the transition to a more sustainable global economy is best thought of as a series of industrial revolutions in energy and transportation and materials in food and so as investors. What we're looking at is the value change in each of those industries and how they're likely to evolve over the next 10 to 15 years and then, crucially, trying to work out what's not priced in. So technology change, regulatory change change to consumer preferences that perhaps other investors are not really understanding fully.


Speaker 0:
So the response to the drivers around the transition to a more sustainable economy, then the key thing that investors need to do is to price risk effectively. That's become a major theme. But at the same time, there's also an opportunity to engage with companies that are operating at large scale in today's economy just to challenge them as to what their plans are as we move to a Net zero system.


Speaker 0:
And the third thing is really just to sharpen our our skills and pay more attention to the solutions to problems like climate change and the erosion of of biodiversity. So we're paying quite a lot of attention to, um, looking at opportunities around environmental markets.


Speaker 0:
So 50% of global GDP depends on biodiversity, and 60% of the plant based calories that we eat come from just three crops. So biodiversity is a major issue for investors today. Policymakers, however, are having a real challenge because, unlike climate change, biodiversity is not a uniform or homogeneous global problem, and the solutions need to be multi local.


Speaker 0:
So what we're doing right now as investors is two things. First of all, we are engaging with the companies that we own to make sure that they've got an answer to protecting biodiversity and that it's they're acting out of self interest if you like to improve quality of the


Speaker 0:
eco systems around the places that that they're operational, and the second thing is investing in what you might call solutions or supporting industries like the water supply sector. So making sure that water is efficiently used and water catchment areas are sustainably managed and secondly around reducing waste because waste generally produces pollution and poll pollution can harm by the risk.


Speaker 0:
So key themes for the moment for investors, obviously inflation. That's top of everyone's list. But we're also paying quite a lot of attention to workforces and what's happening post covid in terms of, uh, people coming back to the office and what that's doing to corporate UM efficiency and potential value creation or value erosion if they get that wrong.


Speaker 0:
There's also, as we've seen in the covid period, a big switch to digitalization and using it to improve efficiency around the workforce, but also with the much cheaper availability of sensors and the arrival of five G, then the


Speaker 0:
connected Internet of things is becoming a reality. Meanwhile, policymakers are asking very good questions about nature, and we've touched on that elsewhere in the interview. But I think we're going to see a lot more attention from policymakers around biodiversity and climate change over the next few months.

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Allianz Global Investors is a leading active asset manager with over 600 investment professionals in over 20 offices worldwide and managing GBP 452 billion in assets. We invest for the long term and seek to generate value for clients every step of the way. We do this by being active – in how we partner with clients and anticipate their changing needs, and build solutions based on capabilities across public and private markets. Our focus on protecting and enhancing our clients’ assets leads naturally to a commitment to sustainability to drive positive change. Our goal is to elevate the investment experience for clients, whatever their location or objectives.

We started our sustainable investing journey over 20 years ago and were among the first 50 asset managers to sign the United Nations Principles for Responsible Investment (UN PRI) in 2007. We believe that sustainable investing can generate positive performance not just for our clients, but for the community at large.

We aim to integrate environmental, social and governance (ESG) factors across our entire investment value chain to better manage risk and enhance long-term shareholder value. Given the diversity of investors’ objectives and requirements we provide sustainable investing processes with a broad range of approaches, adaptable to different levels of ESG incorporation and client preferences. These enhance our clients’ investment decisions while helping create benefits for society as a whole. The combined assets under management of the ESG risk-focused and Sustainable product categories amount to over GBP 224 billion. Read our new blog for fresh takes on sustainable investing – from renewables to rewilding.

Data as at 31 March 2023

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You would never settle for the status quo — that’s why iShares relentlessly pursues better ways to invest.

Capital at risk. The value of investments and the income from them can fall as well as rise and are not guaranteed. Investors may not get back the amount originally invested.

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We aim to improve the world by investing with care. Our active approach to managing money considers a broad range of environmental, social and governance (ESG) factors that can have an impact on our investments. This is why we engage directly with the businesses we invest in. Supporting them in their mission to improve people’s lives, make society stronger and protect our planet. Helping others to become greener, more responsible and sustainable.

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The value and income of a fund's assets will go down as well as up. This will cause the value of your investment to fall as well as rise and you may get back less than you originally invested.

We are unable to give financial advice. If you are unsure about the suitability of your investment, speak to your financial adviser.

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