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    ESG ETFs. The Time is now. A ticking clock

    ESG + ETFs: The time is now


    Camilla Love: Thanks. Thanks, everyone, and thanks, Chris. And the financial stand, a crew and well done, Eugene, for the presentation on emerging markets and I definitely took a lot away and hopefully my financial planner will allocate some stuff into financial into emerging markets. So we’d like to cover ESG today, which I think is really exciting topic. And I’d like to introduce my esteemed panel, which will be the champagne standard for today. The first person up here is Emily O’Neill. She’s the deputy portfolio manager of the Invest Better Future Fund, and that is our flagship small and mid-cap ESG fund. And it is an absolute cracking fund. So I’m really pleased to have her up here. The next panelist is Mark Monfort. He is your data guru. He’ll talk a lot about data in this space. And he is the founder of New Era Analytics. And finally, you have Adam Montana, who is a financial planner and the director of Altice Financial. So we’re here to talk about ESG and why the time is now. And I know that this is a topic that is everyone’s been talking about, particularly for the last 18 months since the bushfires and obviously the current global pandemic that we in. But it is a really great sematic for investors to really access the next generation and where the performance is going to come from. So maybe to start, Emily, I’d like to start with you, because ESG, sustainability, ethical. What’s your view on this? Can you define it for us? And how do you define what a better future is amongst your investment portfolio?


    Emilie O’Neill: Sure. Thank you, Cam, and thanks for sticking around. Hopefully it’s for us and not the champagne, but I’ll keep


    Camilla Love: You


    Emilie O’Neill: And ask you probably hear a lot about it. Most of you probably know it stands for environmental, social and governance. There’s many factors under each of those headings. But basically the premise is to invest in companies that are performing well across environment, social and governance. In environment we’re looking at things like climate change, greenhouse gas emissions, water and waste management, environmental fines, Social is all about the customer, employees and society more broadly. So things like safety, gender, diversity and then governance is your traditional corporate governance metrics. So we’re looking at board composition, executive remuneration and independence and tax treatment. So, for example, I guess what ESG and sustainability means to me is really twofold. Firstly, it’s a way to manage material risks and opportunities within a business. And we think that companies that are doing good things for the environment and the society are going to experience investment tailwinds and that leads to outperformance. But it’s really directing capital towards companies that are doing good things and away for companies that are not contributing to a better environment or a better society.


    Camilla Love: And Mark, I mean, we’ve talked I mean, all over the press this year particularly is news about ESG and the latest launches, particularly in the ETF space for sustainable funds. You’re our data guy here. Tell us what the facts says.


    Mark Monfort: I just forgot to get the clicker because there’s a chart. We can’t have data without actually having a chart. Right. So it’s not that one. That one there. So you’ve got a preview of the last one. There’s a lot of data on that table. We’ll talk about that later. But I always worry that the charts weren’t going to be big enough. I didn’t realize the TV was going to scale to the size that we needed. And and secondly, you know, it’s really good that we’re talking ESG and I just noticed that this is this is sustainable water. So well done, Chri and team. In terms of the data through the ETF tracker app that we’ve got. What we saw was the FUM has grown to three point three billion over the 20 different ESG ETFs that are out there in the market that’s across the ASX and CHI-X. The additional thing is that inflows are actually continuing to grow quite strongly as well. March last saw in March this year. We’re still waiting on the April numbers, but March. So one hundred and eighty six million come in in terms of inflows. So there’s a lot of good tailwind that’s there. If that continues, we should get to four billion by the end of twenty twenty one. Bloomberg is talking about global ESG. It’s getting to 190 billion by the end of twenty twenty one. So there’s a lot of strong movement there. And then in terms of performance, because it’s like, OK, right. There’s a lot of inflows. But performance wise, what we saw was that if you’re an ESG ETF and it’s a smaller group versus the other non ESG cohort, you saw plus 11 percent performance from January 2020 until now in terms of total price returns, reinvesting dividends versus eight percent if you’re a non ESG and Morningstar research on this as well.


    Mark Monfort: So there’s strong, strong performance there in terms of what we saw in terms of investors. Investors were really interesting because investment trends did some research on this a couple of weeks ago. And what they saw was that seventy four percent of Gen Z they are using some sort of ESG product or invested in one sort of ESG product, at least in the last year. That’s a very strong tailwind when you think about intergenerational wealth distribution and then the other parts where if you’re already an ESG investor and very important for the advisors in the room, which is a lot of you, 52 percent of people that got into ESG or were aware of, they were aware because of an advisor, if you were not advised, didn’t have a financial advisor, it was only forty three percent. So advisors play a very, very strong and massive role in terms of communicating ESG to people. In terms of what we saw, you know, with ESG, you’ve got to be aware of the hype that they could be around, that you’ve got to look underneath the holdings. What’s the liquidity like? What is the spread’s? You want to buy into things that actually have good metrics. So treat it like any other ETF, basically.


    Camilla Love: Yeah, we’ll pull a little bit more out on that factor. But going back onto what you’ve said and tie it into, you know, Adam, in your practice, what are you saying from your financial you know, your clients and who are the type of clients who are really interested in investing in this space?


    Adam Montana: It’s it’s really broad. We’ve got, you know, as we probably all have a client base of varied ages and segments. And, you know, the the gen wise, the gen Zs, whoever they really focused on, on climate change and allocating, you know, three quarters, as the stats say, we’re getting a lot of conversations around where can we allocate our money for good. And that ties into what Emily was saying. Is it impact investing? Is it SRI, is it ESG? It’s really looking at what it means to them. And then we have a look at retirees or retirees that have accumulated their wealth and are really looking at that wealth as a source of funds to make a material change in law and what their values are. So it’s it’s an ever changing conversation across the client base. And I think it’s a movement that is here and I don’t think it’s going away. And what is driving this this change in conversation is, is everything that we are seeing in the newspapers. We’re seeing bushfire’s, we’re seeing COVID, where we’re seeing societal movements, all of these factors coming into conversations and saying, well, I want to make a change. How can I allocate our funds or my wealth to make that change as we continue to grow?


    Camilla Love: And how does this change how those conversations with your clients changed from five years to now and then? Where do you expect that to go in the sphere?


    Adam Montana: And we’ll touch on a little bit later on as well around performance of. And the expectational, the perception that allocating to ESG strategies, you were going to compromise a little bit on on performance or returns now we’ve got some great data. We’ve got some some track records. That’s no longer the case. So the the conversation on the barriers to introducing, investing and allocating to clients has really been brought down over the last five years. And we see, especially in our business, where we’re starting to build portfolios specifically around ESG and have that as an option within our preferences, conversations to to clients. And that’s going to continue to grow. You have a look at education standards. You look at standard six in say, we as advisors are going to have to illustrate and demonstrate that we are having these conversations with clients.


    Camilla Love: And Emily, putting your portfolio manager hat on what do you see in the institutional space? How are you dealing with companies? What are the hot topics and how is that manifesting in the portfolio?


    Emilie O’Neill: Yeah, so we’ve seen a massive shift in how companies are responding to Asia engagement. It was a little bit more a few years ago. You know, you really had to push for the conversation. And now we have companies coming us coming to us to talk about ESG, which is a great change, and it’s going to continue to evolve. And some of the key things that have really surfaced in the media and in drawing attention to to the space, things like indigenous heritage, obviously alignment with the Paris agreement, modern slavery and the impact of the risk in the supply chains. And so all of these things have really cold calls to call to action for companies. And investors are asking about it. Their end consumers are asking about it and their employees care. And so it’s having all of these flow on effects to their business operations.


    Camilla Love: And so and you do a survey every year of the ASX 300. From your experience in past surveys to the recent one, how has the priority changed for companies in this space?


    Emilie O’Neill: And what was really interesting was actually seventy five percent of companies said that discussing with investors has helped to improve their performance, which was a positive that came out of that. But more and more, we’re saying it linked into strategy of companies. We’re seeing it linked in remuneration reports. It’s been driven from top down, which is really good to say. But one of the best ways to say how ingrained ESG is into a company’s day to day is to ask the question to to their executives and particularly in the small cap space where they don’t get asked about this often. They don’t have rehearsed answers. And so we get a really transparent view of how it is integrated throughout the organisation.


    Camilla Love: And and what do you see from there? Is it does it give you hope that you’re going to have way more companies to choose from or you know, or is there a long way to go?


    Emilie O’Neill: It’s mixed and it’s improving. And I think that the pipeline of opportunities is only going to increase, particularly as the flow of money into this space continues, as you were discussing. But also regulatory change is is driving tailwinds for these companies that are doing focus on ESG and the conversations are getting more sophisticated, which is really good to say. And there’s more disclosures. But again, we have to be careful of greenwashing risk, and I’m sure we’ll get to that


    Camilla Love: In a little bit. And Adam, you know, there’s a lot of talk, particularly the data says through investment trends, that financial advisors don’t necessarily think that there’s enough product out there or they don’t feel comfortable that they have enough education to be able to talk to their clients about this. What’s your view on that? Has that changed? And what do you think? It’s the is


    Adam Montana: It’s it’s it’s definitely changing fast. And, you know, be no surprise to us in the room, product providers will keep an eye on where funds flow goes. And as we continue to see an increase in allocation to ESG, I think the the products available, the product suite available will will continue to increase through market research. We’ve got between 17 20 AHJ ETFs available now, and that is going to increase over time. What we’ll see is a lot more active managers come to the market, especially with ETFs. You know, the Iron Q and Emily’s Fund is is one of the longest standing funds which which focuses on your small, timid Aussie equities here with a with a discrete ESG overlay, which is great. There’s this product out there. If you want to go and do a little bit of research and and have a look at that as allocation, their education’s really key in anything that we do as advisors and clients. Clients are looking for this skillset, you know, when they’re either looking for a new advisor or they they’re assessing existing advisors. So it’s really important to have a look at the education foundations and RI Academy, Morningstar, MSCI, or even just talking to some of the the managers, especially the active managers, and just building your knowledge so you can you can be confident and having that conversation with clients around what ESG means to them and how they want their portfolios allocated.


    Camilla Love: So I’m going to go to the audience for any quick questions before I continue on. How does everybody put a show of hands? Does everybody have an allocation to a sustainable portfolio amongst their clients? You do. That’s great. And how what’s your view, for example? So I don’t know your name on the reporting that you get from your investment managers and your journey that you’ve had with those those funds


    Mark Monfort: My name is Matt, by the way. We’ve got an investment committee that myself and Irene sits on. And Irene’s been chairing the ESG sort of side of things. And we’ve recently been using our affinity as our active manager. We’ve done pretty well. And we found some particular firms found that clients, particularly the younger generation, are asking a lot about ESG. And I don’t think we’ve had enough of an education around ESG to answer some of those deep dive questions. So it’s something that we’re going on as a learning curve, but it’s definitely something that’s growing within our portfolios.


    Camilla Love: And where are you heading for your education? Can I ask?


    Mark Monfort: Oh yes. So Lonsec mainly we use them as a research house so they devised this five bee kind of category to sort of say well sort of green that these funds are, these funds are in and what’s sort of under the hood. So mainly Lonsec


    Camilla Love: You’ll be pleased to know that Emily’s Fund gets five bees out of five. So it’s a very good strategy for that. Does anyone else have any other questions out there. No. OK, so what am I going to is talking about a little bit about green washing because there is a lot of it out there and I think we could probably look under the hood a little bit more. And Emily, what how how do you know whether you’re being greenwashed?


    Emilie O’Neill: Yeah, well, I just might take a step back and just kind of maybe briefly explain what what is greenwashing? And it’s a concept that companies or funds are promoting themselves as sustainable or environmental or green. But when you like you say, look under the hood, it’s really not what you would expect. And the first thing that I say to clients, potential clients and even my friends is look at the underlying holdings of the portfolio. And that will give you a really good indication of whether it’s aligned with what you’d expect in a sustainable product. And typically, from a corporate perspective, it’s about corporates portraying themselves as environmental or as having positive social outcomes, but really actually that there’s a lot of ingrained issues, issues within the company. And there’s an example. Cleanaway, for example, is a company that was held in a lot of ESG portfolios. They have great energy from waste program and also they’re in the circular economy thematic. But unfortunately, last year there was bullying accusations against the CEO. So that just shows that it can be an ESG in a thematic, but not necessarily all super solid across all elements of ESG. Another example is Rio.


    Emilie O’Neill: It was traditionally pitched as the more friendly for for native heritage. And of course, they had the blessing of Jukan gold. So they’re just some examples of how that can play out from a corporate perspective. On the fund side, what we say is sometimes managers can take a traditional fund and label it as sustainable or ESG and they might put in some negative screens, but they could have really high revenue thresholds. So they could have they could allow up to 20 percent revenue from thermal coal, for example. And when you get down to it really doesn’t exclude much from the index. And so you basically end up with the same portfolio, except it’s being labelled as ESG or sustainable. So, again, what I’d say is go and look at the holdings. Are they transparent or do they just put top 10 in picture? We try to be as transparent as possible. We publish all of our holdings on a delayed basis every month, and we hope that there’s no nasty surprises in there. And we’re happy to have the conversation on every single stock about why it’s in our fund and why we consider it an ESG investment.


    Camilla Love: And what can advisees do to sort of understand whether there is greenwashing going on?


    Emilie O’Neill: Yeah, well, they can ask the manager about their process. Does do they have dedicated sustainability staff? Do those staff sit within the investment team or are they in their own segregated element? Can portfolio managers discuss how they’re integrating ESG? I mean, it’s fine for the sustainability team to talk about it, but the portfolio managers, the people who are choosing what’s going in the fund, so can they discuss it and also look at the exclusions, look at their revenue thresholds, and that will give you a really clear indication.


    Camilla Love: And how do you make sure that your portfolio doesn’t attribute that?


    Emilie O’Neill: Yeah, so there’s I mean, we have quite a lot of external verification on our fund and our process. But the key that we have two ways we do it. We’re really seeking out those companies that we believe are contributing to a better future. So they have to be in industries like health care, education, renewable energy, low carbon technology. Provide social outcomes, so it might be through employee engagement, for example, and they have to be high scoring on our internal ESG, what we call it, in a scoring mechanism. The second E is what we call engagement, and it gets complicated. But basically with external data providers, it’s very large cap focus because the smaller companies get penalized for not having those big disclosures. They don’t have the dedicated sustainability teams. What engagement allows us to do is look through those issues with this large versus small and be able to come up with an idea of whether it is ingrained into the organization.


    Adam Montana: I actually think it’s going further than that. This is greenwashing, you know, focus. And we currently at our business are looking at what we’re in the middle of building managed accounts and we’re building an ESG portfolio, getting pushback on the on the wording or the naming convention of these managed accounts from the RE because of the risk of potential litigation back from end clients. So we’re Emily’s focusing on with the with the fund and with individual stocks. I think it will come and regulation will will flow through to us as advisors in the way that we present and distribute our strategies to to clients.


    Camilla Love: It’s interesting. Now, Mark, you and Emily both talked about really looking under the hood. What does the data say about what’s in ESG indices and. Well, I


    Mark Monfort: Asked a bit. Yeah, it’s interesting. You know, the theme here, not not just for us, but for a lot of the others has been look under the hood and there’s a reason for that. You know, whether you’re active or passive, there’s a lot of good details underneath what ETFs are holding. And unfortunately, a lot of people can just get pulled in with the hype and they hear ESG or they hear TECH or robotics or whatever. But looking underneath the hood, you’ve got to see whether or not those holdings actually agree with what it is that you’re you’re looking at. So we crunched the numbers. There’s a lot of data out there. There’s a lot of different naming conventions for the tickers. Some will use, you know, one provider, some will use another says a lot of cleansing. But in terms of just looking at a high level, the sectors you mentioned, health care, health care and financials are amongst the top in terms of average, what we see exposure for anything, that is equity exposure. So this is not looking at the bonds. They’ve got different exposures, but there’s some hybrids in here that they’ve also got quite a large equity exposure. But what we saw was the financials, health care, consumer discretionary information technology, some of the biggest exposures across the board. However, that does not mean that each ESG ETF actually that’s what they’re doing. You know, there’s some that are much more industrials and materials.


    Mark Monfort: You’ve got to look underneath the hood. You’ve got to look at things like correlations. What’s the similarity between holdings? Like you might think that it’s OK to to get this ETF. We’d like another different thematic. And actually you’ve got a lot of crossover and similarity there. So when it’s getting really hard to try to understand, like what is going on there, sometimes you might need to look at, you know, is is passive the right model for you or do you need to look at active and do you need to have someone who can guide you through this movement towards ESG? As we said before, with the investment trends research, there’s more and more people that are looking, for example, into carbon. So carbon and the E part of ESG. So the investment trends research also said that of those last year, the most important topic was fifty eight percent into environment, saying environment is the most important topic for them is ESG investors. This year it’s seventy eight percent. So looking at what the different kind of holdings are across the different sectors, combining that with what investors want, seeing that it’s really important as advisors to be showing your people and educating them on what they need to do to navigate the ESG environment. I think putting that all together is going to be really key.


    Camilla Love: And Emily, Adam touched on, you know, the past performance rhetoric in this space. What’s your view about performance and ESG and is this thematic going to be ongoing? Because performance can be fleeting, but it’d be great to access ESG as a thematic and actually have some great, great performance, like I know your fund does.


    Emilie O’Neill: If there’s one thing I can leave you with today, it’s that investing in a sustainable way does not compromise returns. And what what we’ve found in our fund and also what the research shows out there is that when you invest in companies that are focused on sustainability and ESG, they do tend to have less regulatory risk. They have less ESG controversies because of that. They have lower turnover, they have a greater ability to retain and and keep talent. They tend to be lower volatility. They have low costs of capital and therefore high valuations. And so there’s a lot of reasons why companies that are focused on this will tend to outperform. The RIAA benchmarking report in twenty twenty showed that Australian R.I strategies outperformed the ASX 300 on a one year, three year, five year and 10 year basis. So of course there’s going to be some managers that underperform and some that that significantly outperform. But there is no correlation between underperformance and sustainable investing. And that’s something that I’m really passionate about.


    Camilla Love: Obviously, I can tell definitely. And Adam, you know, how do you translate that discussion with your clients?


    Adam Montana: I think it’s you’ve got the numbers there now to have a look at these portfolios. I mean, we we leave the really hard stuff up to the smart people in the room like Emily, where she will pick the active stocks in the portfolio. I mean, the majority or a large portion of our role as advisors is is asset allocations and and tilts towards that. So we actually look forward to to try to understand what the main drivers of returns are going to be over the next one, three, five, 10 years and allocate accordingly. And in this day and age, in this environment we live in, you know, a lot of the factors that are captured in an ESG strategy are at the forefront of what we believe are going to be return drivers. When you have a look at the one point five, you have a look at net zero. All of you look at societal movements. All of these factors will be captured in Mark’s data and Emily’s Fund. So I think it’s it’s probably an opportunity to miss out on returns if you’re not having these conversations, there will be overlays in other funds that the active or passive funds that we look at allocating to and clients portfolios, but having a discrete allocation to ESG and having that conversation with the client at the at the start is is really helpful in positioning future returns.


    Camilla Love: And Emily, you always say that engagement is your secret sauce to performance. Why is that? What can you get out of companies through engagement that gives you that extra performance as an active manager? And how has that engagement changed over the time you’ve been in the segment?


    Emilie O’Neill: Yeah, I think I touched on it briefly before. But one of the key advantages of being an active manager is we do get exposure to management teams multiple times a year. We can discuss material ESG risk and opportunities in their business, making sure management is is addressing those. Typically managers who are looking at their ESG risks are typically better at managing the risk across the rest of their broader business. So they tend to be better run companies. What I think is fantastic is to say those companies that are passionate about improving their performance on ESG and we’re able to identify the key material factors for every company is different. They all have different material drivers and through engagement, we’re able to discuss that with them, drive positive outcomes. For example, gender diversity is something we’re really focused on in improving that throughout the organization and their conversations we can have over many periods of years where we can make change. And there’s lots of research out there to show that diversity in a company, not just gender, but across all forms, does actually lead to better performance.


    Camilla Love: Can you give us a real life example of your engagement and the impact that has had


    Emilie O’Neill: One that literally just came up yesterday in October last year we actually had a conversation with Blackmore’s about the lack of gender diversity on their board at the time as only 20 percent. At  the beginning of this year they announced a board refresh so that one of the independent female directors was appointed as chairperson. And actually, just this week, earlier this week, they announced an additional two independent directors. And we like to think that we contributed to that push. But also we have companies reaching out to us and we can help provide people that they could recruit who would be great in that position.


    Camilla Love: And I know that modern slavery has been an interesting, you know, advent in the legislative agenda over the last little while. And obviously it’s all coming in sort of June ish. What engagement have you had there that is really adding value, particularly for those companies who have supply chains offshore?


    Emilie O’Neill: Yeah, we actually are part of a new collaborative called Investors Against Human Trafficking, which is all about identifying and assisting to minimize modern slavery risk in supply chains. And that’s a collaborative engagement when asset owners and asset managers and we are on a working group for one of the companies. And what we’re really trying to do there is obviously when there’s issues in the supply chain, evidence of underpayment, for example, that kind of material share price implications, I think it was BooHoo last year whose share price went down 30 percent after it was found that there was underpayment in the supply chain. So these are material factors. And so it’s really important, particularly with the Australian Commonwealth Modern Slavery Act that’s come into force. Companies are required to map their supply chain and identify areas of risk. And we need to be aware of that as investors, because if there is a risk that for one to fix is remediation costs and serious social licence to operate.


    Camilla Love: And Adam, are you getting that sort of look through from your managers on ESG, whether they’re a specific asset manager or not?


    Adam Montana: We are. I mean, we we obviously we don’t engage the companies. We engage the fund managers. So Affinity is is a manager that we use in the non ETF space and understanding what their philosophy is and how they actually construct their portfolio and what screens they apply. Because our clients don’t necessarily want to know all the data that Mark would pull together. They stock stories and, you know, illustrating how we’re actually achieving they’re meeting their values and their objectives is is what’s really key to them. So managers are more than happy to to pick up the phone and and talk you through their process. And they stockholdings and I know Emily would probably set up for three days and talk about their process and every single stock in the portfolio. But it’s it it’s becoming more mainstream.


    Camilla Love: Yeah. Mhm. Now I’ve got about five minutes to go. Does anyone have any questions for the panel.


    Attendeee: Thanks, I suppose. From what I’m picking up. The idea is that companies with high or better ESG scores will. Over the course of time, outperform companies that have poor or lower ESG so on that basis, would you see moving forward that those two, I suppose if you’re looking at an index, for example, the better ESG companies are going to move into the further up the index? So those two components should converge anyway. Or the companies that have, for example, mediocre ESG will say, well, we need to improve it. So did the two ends of the spectrum end up converging or coming together anyway? Is that how it works?


    Emilie O’Neill: I think there’s a few elements in there. The first is that every company is improving because they know that they’re not going to get investor attention as much as more and more flows coming into the space. So they’re all getting up the curve and there are all at least putting out policies and putting it in their presentations. And the CEO is going to talk about it. So, yes, there is going to be some convergence. But then the issue of scores is, I guess, controversial. Managers do it different ways. Some have an internal scoring mechanism, which is what we do. But there are some funds that use external scoring data providers. There’s many out there, sustainalitics and MSCI, there’s a whole bunch. And actually the scores between those providers, the correlation is really low. And so what does that tell you? It tells you that people are looking at different factors and scoring things differently. And I think it comes back to our ability as active managers to engage. We don’t just see it as a score, yes or no. Our scoring mechanism, the best scoring companies are twofold. So firstly, they’re doing really they’re performing well on age from a corporate perspective. So they are managing their waste, that they’re recording their emissions. They have targets in place. But actually, the purpose of the organization is doing good things, not bad things. And so the top scoring company will be in a sector that’s not damaging, but will also be really strong from a corporate ESG perspective as well.


    Camilla Love: And Emily, I mean, most of the most of the products in this space are actually negative screen products, right? Your fund that actually has a positive inclusion piece. Can you talk to me a little bit about that?


    Emilie O’Neill: Yeah. So I touched on that before. I mean, there’s many ways to do ESG and, you know, there’s many ways to win. It is becoming increasingly more sophisticated. And we do have, of course, the traditional negative screens that you’d expect to see. So the tobacco, thermal coal, gambling, alcohol, toxic pesticides and all those types of things. And we have a zero revenue threshold. So we do not allow any companies into our funds that have any revenue exposure to to those industries. But also we’re really targeting those things that we say contributing to a better future. And that’s all of those industries that I was talking to before. So, you know, they’re helping people through health care or they’re really tackling environmental issues like carbon capture and alignment with the Paris agreement.


    Camilla Love: Now, there’s a question of the fact that.


    Adam Montana: So there seems to be like a convergence of different momentums going on here as the momentum of younger people in particular moving into the segment and then them potentially inheriting a lot of wealth from their baby boomer parents fairly soon. There’s the momentum of consumer demand wanting more and more companies to do more in this space. Does that have an impact on valuations? There’s more money going in to certain number amount of stocks, and we expect that more money in the future will go in to the same universe of stocks. Is that is that impacting valuation at all?


    Emilie O’Neill: I have views, but I’m cautious of taking up a lot of our time,


    Camilla Love: And


    Emilie O’Neill: So, yes, we are saying the weight of money impacts valuations and there is a little bit of talk about valuations on sustainable companies too high. And is it is it a bubble? The great thing about being active is we actually look for valuation in our investments and we’re trying to find those things that we think have a great potential to significantly outperform. A lot of the funds of small companies that have potential to double or triple over time as they gain scale. So, yes, it is a concern. I mean, that’s also a tailwind. We think the companies that we hold are probably going to experience more attention as there’s a more larger weight of money going into the space. Absolutely. But as active managers, we’re very cautious of not paying too much for stocks that are in the fund. And just because they have an ESG thematic


    Camilla Love: And I think that goes into what Adam was saying about, you know, taking advantage in this into this thematic, whether you love ESG or not, getting that exposure into your client’s portfolio.


    Adam Montana: Yes, absolutely. I think it’s you know, we we’re in a period of change. And I as advisors, we need to understand what opportunities are there for not just strategy and strategic advice, but but how we allocate clients financial wealth and having an exposure to ESG or at least having that conversation with clients and getting that knowledge around what impact that will have to their their future wealth is is really key to part of the the preferences conversations we have with clients.


    Camilla Love: And I think that’s a really good place to end, Adam. So thank you and thanks everybody for listening to our Champagne Standard panel today. And if you’d like to find out more about Emily’s Fund head to, the ticker code is IMPQ.

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