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RI Careers Interview: “Remaking the capital markets in a way that is aligned with a sustainable future”

Emily Chew, Global Head of ESG Research and Integration at Manulife Investment Management talks to Responsible Investor about how she got into ESG and her career to date.

Tell us a bit about your current role and the company you work at?

My job entails managing a team of ESG research analysts that are positioned in the front office and work collaboratively with portfolio managers to integrate ESG risks and opportunities into the investment decision-making process. The team also leads and executes investee engagement programmes related to those ESG risks and opportunities. 

Do you provide any training for your portfolio managers? 

We have an ongoing training programme for the portfolio managers, and are planning to formalise this further in 2020. A lot of investment team training is done by looking at the portfolio companies one by one, collaborating with the teams on engagement, and co-developing new proprietary research: whether they are thematic research papers or new ESG assessment or scoring models. 

How have you seen the portfolio managers’ interest evolve over time? 

The interest of portfolio managers has reflected the development of ESG awareness in the industry, which is itself moving from ‘general awareness’ to a much more focused discussion around specific issues and data points. I think we are moving away from this binary notion of ‘ESG compliance’ among the companies that we invest in to a much more nuanced realisation that true ESG integration is an ongoing process of learning, as the world and capital markets continue to evolve. 

What does a typical working week look like for you? What do you do on a daily basis?

There is no typical working week in ESG! Though the role is clearly defined, the reality is that we are trying to support an entire asset management business which has a number of different positions and functions that need help in slightly different ways. There is a lot of stake-holder management: meetings and collaborations with various teams across the firm such as portfolio managers, distribution and sales, legal and compliance. 

Have you always worked in RI/ESG? 

I started my corporate career in law and had previously worked for several legal and human rights NGOs.

How did you move to RI/ESG? 

At some point in my career, I came to the view that working in the private sector and in business was the avenue through which I could bring a more holistic view of my interests and values, and could be impactful at scale in the world. That drove my decision to do an MBA with an emphasis on social business: the intersection between investment capital, environmental impact, and social enterprise. And from there I was just really lucky: right place, right time. 

I happened to be living in Beijing at the time when MSCI were looking to build up their research team. In the aftermath of the global financial crisis, there was a lot of movement of capital to emerging markets. What came with that was demand for more transparency into the sustainability performance of emerging market companies, particularly the biggest country contributors to the emerging markets index (China, Korea and Taiwan). So I was on a research team helping to influence the development of the research model and findings that helped shape how we understand sustainability in the Chinese context – it was an amazing opportunity to develop. 

What do you like most, like least about RI/ESG?

What I like most is the industry’s wide vision of remaking the capital markets in a way that is aligned with a sustainable future. I like the ambition, the vision, the momentum, the positivity. It’s about new frontiers, creating new models, really re-visiting of old ways of doing investing and remaking them in a way that is oriented towards the future. So I like the future-proofing aspect of RI/ESG. 

What I least like is that we still need to justify the business case for ESG: why ESG analysis is important, why ESG integration leads to better investing. We are still being held to a higher standard on the relevance and materiality of ESG metrics than metrics that have been long agreed on and standardised in traditional financial reporting. People are looking for the quantification of information that can be inherently qualitative before they act on it. This approach risks being reactive and missing the forest for the trees – so often, the direction of travel of an ESG issue for a company is clear, but our traditional analytical models in finance are too rigidly applied to allow analysts the freedom to accommodate this direction of travel.

Do you think it’s because people in conventional finance are looking for excuses not to change the current model and adapt to it?  

I find many people in finance are quite thoughtful, insightful and considerate on sustainability topics. The speed of adoption of ESG analysis is much more reflective of personality and an individual’s state of being. People look at the same things and come to different conclusions about their relevance, because some people are more linear thinkers and some are more holistic. Someone may focus on the reasons not to do something, rather than on the reasons to do something. And that is not related to sustainability or finance at all – these are more behavioral, psychological aspects. 

What single thing or person has had the most positive impact on your career, and why?

There is no single thing or person, I think a lot of factors have influenced my path. Taking it back to basics, I owe a lot to my parents who brought me up with a spirit of service and excellence in whatever I do. In that framework, the purpose of my career is not my personal gain but a contribution to a broader community and society. I think that also helps to put a career into perspective that not getting a certain promotion, title or salary doesn’t define you, it’s not your whole identity. 

Another person who had a strong positive impact on my was my manager at MSCI, Linda-Eling Lee. She is a wonderful manager, and helped me to move from the individual analyst contributor role to thinking of my role in a more strategic way. She was also a very involved manager who always made herself available for advice and guidance. 

In my current role, my direct manager and the management team generally have given me a lot of opportunities to grow, and allowed the ESG function and ESG team the space to incubate and set strategic direction in the context of an industry that is fast-moving and rapidly evolving. 

What is your understanding of a sustainable workplace? 

At a minimum, it has to be a place where people feel psychologically safe to do their work right. It’s down to the leadership of the organisation, the individuals, the teams to create that safety and a sustainable work culture that supports people wanting to stay, wanting to contribute and wanting to bring their best. And it’s not only about lactation rooms, diversity policies or fair wages, but it’s also about an overarching vision and values that helps explain why the company exists, what’s the company’s social function, and what’s the role of work in society and the role of work in individual people's lives.  

In your view, how is the work culture changing to meet the demands and aspirations of a new generation, i.e. millennials? 

Millennials are more dominant in the workforce today than ever, in the US, for example, the number of millennials in the workforce is already more than 50 percent. This partially is driving many companies to move to more sustainable business practices and to communicate that overarching vision around the role of the company in society, as a millennial retention strategy. 

Another ‘disruptor’ is the gig economy which, on the one hand, brings a lot of flexibility, but on the other hand, creates lots of insecurity both for employees and companies and makes it much harder to build a career path. In parallel, companies seem to be less inclined to invest in staff training due to the lack of employees’ loyalty and longevity. These are quite complex dynamics when it comes to making this determination about whether a workplace is sustainable, and striking the right balance is quite a tricky issue for H.R. teams and executive teams. But I think again it comes down to values and culture. I do think that young people and millennials will stay if you provide them with a compelling value proposition – not only remuneration, but the appropriate level of autonomy, growth opportunities, and a connection to a bigger purpose. 

If you knew what you know now what would you have done differently when you started your career. What advice do you wish you’d been given when you started out?

I think some of the advice would be: a year in the workforce is probably a lot more valuable than a year of study, as long as you make sure that you continue to be on a steep learning curve in your early years in the workforce. It’s also important to remember that your career path development is not a straightforward linear path, unless you go into a very traditional industry, such as an accounting or a law firm, for example. 

When it comes to soft skills, they are crucial in any role. Having a problem-solving mindset, being able to work with different individuals, i.e. being able to read the different incentives and the different motivations that different people have, is critical for being able to move complex projects forward. In the ESG space, whether it's a new type of fund, a new type of client reports or a new kind of social media campaign on a particular topic – these are all multi-stakeholder projects that require getting along with people, making friends on the way and building working relationships, and that's what people mean when they say “soft skills are important”.

How important it is to have someone in a team who has a background in natural science? 

I think it depends. For example, a natural sciences background is very well suited to particular types of asset classes like underwriting for green bonds, or underwriting physical assets during a time of climate change that could be helpful for insurance companies. It could be very relevant to private equity. But if you're talking about broad-based asset classes like equities and fixed income, then you are looking at the instrument rather than the underlying business, meaning there may be a need for more generalist knowledge and subject matter flexibility. 

Looking ahead, where do you see the opportunities or growth areas for career paths in RI/ESG?

I would say whether it's asset management, banking, insurance, consulting or rating agencies – having a solid investment research background is highly valued. 

Another role that seems to be emerging is in ESG product management, although core responsibilities may vary: it could be assembling a suite of ESG products on a banking platform, managing the marketing of ESG thematic funds, or it could be working on a product development strategy for a large asset manager that wants to peel off a number of different funds over 2019 and 2020. 

Jobs and roles are being integrated and some responsibilities are being absorbed by existing teams, so a lot of the growth opportunity in this space depends on the specific needs and structure of the firm. 

CV at a glance:

  • Manulife Investment Management, Global Head of ESG Research & Integration, 2016 – present
  • MSCI, ESG Analyst / Head of APAC ESG Research, 2011-2016
  • Baker & McKenzie, Lawyer, Capital Markets & Funds Management, 2006-2009

To access other interviews and Sustainable Finance Careers Report follow the link: esg-data.com/careers