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Head of credit risk, Stanlib Credit Alternatives
Paying attention to impact investing
Global interest in sustainable investing has surged in recent times and in the US alone, sustainable investment funds saw a record $20.6bn of inflows in 2019, almost quadrupling the $5.5 billion dollars of net inflows gathered in 2018, according to Morningstar, the data provider.
Asset managers have experienced what the FT describes as a ‘change of heart’ where investing now looks beyond ‘cold hard profit’. This trend is by no means unique to the US and Europe, as South African asset manager Stanlib can attest to. Nicholas Naidoo, head of credit risk at Stanlib Credit Alternatives, tells us that the country’s interest in ESG has taken off and in his words, “it’s about time.”
According to Nicholas, impact investing is a topic that has long been neglected in South Africa. “There are a lot of people who pay lip service to it, but aren't meaningfully doing anything about it.”
During his career at Stanlib’s parent company Standard Bank, Nicholas was involved in several rounds of fundraising efforts for renewable energy programmes on the continent of Africa and he’s carried his passion for sustainable investing into his current role.
“Unfortunately, the renewable energy momentum, that gained impetus at the start of the previous decade in South Africa, was somewhat lost as the decade drew to a close, following a decline in political will to extend to further rounds.”
Nicholas feels however that the current sentiment shift towards sustainable finance does provide grounds for optimism. “We're upbeat about opportunities in Africa because we invest on the whole continent,” he explains. “And what's particularly exciting about this year is that we are looking at launching a couple of new funds, one of those being an 'Impact Investing' fund.”
The direction of local markets is influenced more than ever by events happening all over the world. For a truly global macroeconomic perspective, it’s vital that asset managers have access to quality sources of global intelligence.
Optimising insight
Stanlib is one of the largest asset managers in South Africa, with in the region of $44 billion dollars in assets under management. As an investor in Africa, which remains an emerging market, they find themselves attuned to what happens in the US and other developed markets such as Europe. For Nicholas, the FT is the only news source that provides him and his team with the depth and breadth of analysis they require.
“We need to know globally what the themes are, and how to position the business along the right strategic lines,” he says. “Inevitably, what happens globally does end up affecting our markets locally.” Nicholas admits that until recently, he had merely been “scratching the tip of the iceberg in terms of all the FT has to offer.”
Following a consultation with a FT customer success manager, Nicholas started to uncover new areas of content he hadn’t seen before. “That session definitely pointed me in the right direction,” he says. “I’m reading other articles and insights on ESG that I would have missed otherwise.”
A unique source of ESG analysis
The FT was early in identifying the shift in tone around socially-responsible investing and editor-at-large Gillian Tett saw a gap for a financial markets perspective on how ESG affects business.
FT Moral Money is now the trusted destination for news and analysis about the world of sustainable finance and impact investing. For asset managers such as Stanlib, Moral Money offers forward-looking, unique insights that show readers what’s coming, and what trends to expect.
Billy Nauman, reporter for Moral Money describes the newsletter as “integral to the way the asset management industry is headed.” A FT Professional Subscription allows seamless content sharing. Nicholas details how he’s been able to surprise colleagues with the FT’s ESG commentary he’s shared with them.
“We’ve started a climate change working group within the business,” he explains. “I was helping a colleague with a presentation and could see he was struggling for content. I shared some FT articles with him and he was impressed with the material.”
“We’re incorporating the key themes into our presentations,” Nicholas concludes. “It’s having tangible benefits.”
Investment in ESG has exploded to $23 trillion dollars, and it’s still growing fast. The FT offers you a trusted guide through our newsletter Moral Money. It’s something you can’t afford to ignore.
FT editor-at-large
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