Raj Thamotheram: a hopeful finance tale about joining this Friday’s Climate Strike

If only our c-suite chiefs could lead on fighting climate change….here’s what it might look like.

Sign up for a free, no-strings trial to Responsible Investor

Sophie was torn about joining the Climate Strike on September 20. Of course, things were moving way too slowly on the climate front and she was really concerned about the world that her children would inherit. Soul and heart said strike!
But when she discussed it with peers, there were several “yes…buts” that she also worried about. “I’m glad they are marching but campaigning isn’t the most productive use of our time,” said her sustainability colleague: “We [the ESG team] have only recently managed to convince our [traditional investment] colleagues that we aren’t ‘NGOs in suits’ – this would set us right back. This isn’t exactly a career enhancing activity given what our colleagues think of campaigners! I applaud the protestors’ concerns, but what they are asking for (net zero by 2025 and for governments to hand over control to a citizen’s assembly) isn’t realistic, is it? Our firm doesn’t support divestment and I don’t want to be shouted at.”
So when Eduardo, the firm’s deputy CIO, sent around a surprise email, saying: “I will be going with my children on the climate strike and if anyone else wants to join, let’s meet at 10am at the office,” Sophie let out a huge sigh. If he could strike, she would too. The relief of not having a split personality at work, at least on this occasion, was very real.
What was really unusual was that Eduardo had explained why he was doing this: “For those who weren’t here when we got started on ESG in 1999, I was the one who pushed hard for “win-win thinking”. Butwe all have to accept that systemic risks like the climate crisis will not be addressed by technocratic answers. I know we all like market environmentalism but looking at the last two decades worth of experience, it’s clear that the ‘doing well by doing good’ approach won’t be enough.” What we need today, said Eduardo, is disruptive policy change as Mary Robinson, the former Irish President, told investors at Mercer’s big Global Investor Forum at the beginning of this month.
He continued: “How do we get to disruptive political and corporate action? We need to bring forward the social tipping points. As investment professionals we spend well over 2,000 hours per year on our day job. So, taking 4 hours off for this strike – which I will make up over the next weekends – is good insurance to make sure the rest is well spent. I’d like us to support youth and millennial campaigners – and moreover, to learn how to communicate with them. Why? We don’t get a lot of opportunity to communicate with the general public and we should take this chance to engage millenials. Younger people have considerable capacity to challenge and educate parents. That means potentially more customers for our integrated ESG approach, and more voter support for climate aware politicians, which means our approach will be more successful. And personally I find colleagues who are willing to speak up on climate change, as happened at Amazon helps keep us ExCo members on our toes.” Having invested in IBM and Goldman Sachs, where encouraging positive employee deviance was something of a management belief, Eduardo could see the value of reinventing this idea for the fund management industry which had lost its recruitment appeal since the global financial crisis. What
Eduardo hadn’t said was how his 13 year old daughter had also challenged him: “Daddy, she said, if scientists can march every year and teachers too, how come all you financial folk who talk so much about climate chance won’t join us? We need your help! Me and my friends get a lot of vicious crap chucked at us on social media – it’s not just Greta Thunberg who’s targeted, you know – and we could really use the support of adults who say they understand the crisis. I mean really, where do you ‘responsible investors’ stand? Is it just to make more money and look good or do you really want to see the changes we need?”
For her part, Sophie was aware that her own emotional commitment and resilience was starting to wane. Like many of her ESG colleagues, she had started to get demoralised by constantly having to defend the incrementalism that is endemic in the sector. Knowing it wasn’t good enough, but pretending as if it was, had started to take its toll. She wasn’t yet ready to call it a day given the box ticking nature of much of her work, but burning out was something she was privately very worried about. At least now she had an opportunity to act at work with more integrity. What was really liberating about Eduardo’s email is that he challenged traditional and ESG staff alike to “strike” in as creative a manner as they were able to, and indicated he had the support of other members of the ExCo for this. “It is not obligatory to march!”, he said, suggesting that staff use this time limited opportunity to practice cross-silo collaboration to develop education or outreach projects. So, while Sophie marched, another colleague decided to show a film about the events in the Amazon and facilitate a staff discussion (coincidentally their investment firm was part of a banking conglomerate that had been mentioned as a major culprit by Amazon Watch). And a particularly outgoing duo (one from her ESG team and another from the sales team) persuaded the local coffee shop to allow them to set up a stall outside to solicit the views of customers and people off the street…………………Sadly, or not, our world doesn’t often have such Hollywood endings. It would be lovely if senior execs at PRI member firms enabled participation in the Climate Strike, in the same way that some firms in Hong Kong have done, despite the much more tense situation there. But, given the level of C suite engagement with ESG, let’s be frank, this is pretty unlikely. Not acting because of the absence of such permission/encouragement is really a clever blame game. It’s as useful as blaming “mummy and daddy” for not being perfect parents. Or, for a more political analogy, it’s comparable to Americans (and Republicans in particular) waiting for Donald Trump to give the go-ahead on climate before they get personally engaged.
I was recently speaking at a conference with John Kasich, a former State Governor who stood for the 2016 Republican nomination. His message was simple: fundamental change – corporate and political – will come from the bottom up
Despite losing to Trump, Kasich has not given up. We, in the ESG community, could learn from him. Every extra 0.1°c of warming we can prevent, the better it will be for millions of people and who knows how many other species. If not us, then who? And if not now, then when?