ESG

Australian Ethical’s partner in the new fund, Infradebt, is an ubiquitous presence in Australia’s energy transition movement, having funded 40 renewable projects to date.

Biodiversity is under rising threat around the world, with potentially disastrous economic and social consequences. Investing in programs that manage and protect these assets will be key to mitigating the associated risks.

In 2023 governments came to a general awareness that to achieve net-zero, robust and consistent ESG policy frameworks must be put in place. In 2024, we should see a continuation of that theme according to New-York based investment group Neuberger Berman.

Ethical investing is rightly associated with driving change for people and the planet, but because it’s about being highly convicted on long-term themes, it also a means to drive better portfolio performance according to Australian Ethical.

Given the opportunity set in front of advisers during the next transfer of generational wealth, now may be the time to reassess the role of responsible investing and the importance of being an ethical steward for capital.

The net-zero transition will bring about an economic transformation, with massive up-front investment leading to near-zero energy costs in the near future, ClearBridge Investments’ Nick Langley told industry leaders at The Inside Network’s ESG Retreat. But big challenges remain, with no easy answers.

Institutional investment teams may still oscillate between engagement and divestment as their first choice in leverage with large emitting companies, but one thing is certain – they are all looking at ways to hold these groups accountable for their activities and behaviours.

To achieve the widespread adoption of green hydrogen necessary to reach net zero targets and for the companies in that sector to achieve their full potential, we are eventually going to need a high carbon price. And that looks still to be some way off.

“The portfolio does look different to mainstream,” says Australian Ethical portfolio manager and equity analyst Deana Mitchell, before explaining how the fund manager tilts up and down to meet its ethical charter.

Sam Elsom, Mr Seaweed and the rest of the Sea Forest team are unlocking the power of asparagopsis to reduce methane emissions in a spectacular way. The plan has caught the attention of Prince William and Caroline Kennedy, but remains bogged down by governmental process.

“Rational, economic arguments” are required to support a reduction of the costs of global warming on the planet and the economy, says Australian Ethical.

Despite being buffeted by some serious headwinds, the sustainable investment movement shows no sign of slowing down in Australia.