This week Shayne Ebudo in the Financial Times described his experiences in the banking world as a Black person. He relates experiences that are truly shocking not only in their racism but also in the utter lack of common decency and politeness by people in power, all of whom were White and generally male. As banks consider their role in addressing social and economic inequality, they also need to reflect and change internal cultures that allow this behaviour to be tolerated. Similar stories also arise over the treatment of women in banking. Can banks attract talent from all sections of society or must they only take on White men with noxious attitudes to be successful?
Delaying the inevitable
Under European Union rules, asset managers will need to provide clarity on the sustainability of their investment portfolios. This reporting is to be in place by March 2021. But of course now that date is coming closer, there is a push to delay it. An excellent article in the Financial Times provides more insight into this issue including a clear discussion of the challenges facing asset managers. However, given the fact that this request has long been known and that there is considerable evidence that attention to ESG factors leads to better financial returns (see the work of George Serafeim for example).
As noted in the article there is a lot of work to be done and not all companies will have the data available. But with any change, starting is the best way to get to the desired end state. And the need to address “greenwashing” is critical if companies and investors are going to move forward to address the challenges of climate change and social and economic inequality. If not today, then when?