There needs to be ‘real intention’ behind decisions about impact investing and ‘bold leadership’ is required in the private wealth sector, panellists agreed at We are Guernsey’s Private Wealth Forum.
‘The Power of Capital’ saw discussions on how to unlock private capital to help the world meets its net-zero targets. The afternoon examined the new taxonomy of ‘purpose-led investing’ and also discussed some of the perceived barriers to adopting an ESG investment strategy.
The panel explored the intersection between sustainable investing and philanthropy. Partner and Head of Philanthropy at C. Hoare & Co, Rennie Hoare, emphasized the role that private wealth can play in the transition to net zero and the urgency of the situation.
“Being proactive with clients now is critical; it is happening but not at the pace we need,” he said. “Covid has driven an awareness of how interconnected our world is, and more of a willingness to invest for good. But even forward-thinking impact investors are facing slow progress. We need to re-start the progress that had been made but was diminished through the pandemic.”
The Guernsey Green Fund was cited as an example of the progressive approach needed to make an impact on the world’s environmental challenges. The jurisdiction’s advisers were also described as ‘motivated’ and having ‘proactive and confident conversations with their clients’ about the transition of private capital into impact funds or ESG investment strategies.
Some challenges presented by the panel – of which Acumen Head of Impact Dr Julia Mensink was also a member while Carey Olsen Head of Dispute Resolution and Litigation Elaine Gray acted as moderator – were echoed in Guernsey’s report on Fiduciary Duty in the 21st Century, which was presented by Sally Rochester, Risk and Regulatory Director at Deloitte.
The report explored Guernsey’s fiduciary sector through the lens of The United Nations Environment Programme Financial Initiative, and the Principles for Responsible Investment (UNEP FI and PRI). That initiative stated that failing to consider long-term investment value drivers, which include environmental, social and governance issues, in investment practice is a failure of fiduciary duty.
Sally Rochester explained that the research showed Guernsey has made significant strides towards meeting the UN’s principles, but much work was still to be done. She cited barriers such as limited local codes and guidance on responsible investment and disclosures.
The report also noted that fiduciary practitioners often have limited clarity on how a trust could be structured to clearly define the objectives of the sustainable investment strategy and offer the trustee some protection from future criticism. As a counter point it, We are Guernsey has developed a suite of educational reports supporting the integration of sustainability into the finance centre’s private wealth offering. This includes guidance for developing sustainable trust deeds to support trustees in putting their 21st century responsibilities into action.
The keynote speech was delivered by Cherie Blair CBE QC, who highlighted the power of investing in female-led enterprise through the work of the Cherie Blair Foundation For Women, which is fighting to close the global gender gap in entrepreneurship through supporting women entrepreneurs in low and middle income countries. She stressed the importance of philanthropy and explained the ripple effect that female-led business often has on the communities around them.
We are Guernsey Chair Lyndon Trott closed the event by saying that whilst the groundwork for a new era of sustainable finance has been laid, the speed of change needs to increase and that Guernsey can play a significant role in the transition to a ‘greener’ global economy.
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