Sustainable investing: the perspective of the asset owner

How have attitudes to sustainable investing changed in the current climate? A group of asset owners offered their views during a panel discussion at LOIM’s annual Transition Investment Summit in London this month.

The panel was moderated by Nicholette MacDonald-Brown, LOIM’s Head of Sustainable Equities, and included Emma Wall, Head of Platform Investments, Hargreaves Lansdown; and Mark Fawcett, CEO, Nest Invest.

In a conversation centred around Donald Trump’s re-election, shifting market expectations and performance headwinds, the investors shared why they remain convinced that sustainability is not a sideline issue or fad – rather, it needs to remain a  fundamental part of every investment decision.

Watch this video for insights from key speakers at the Transition Investment Summit:

“We can ignore a lot of the rhetoric from the US, and just focus on where we can make money for our members and also have an impact on climate change”.

Mark Fawcett, 
CEO, Nest Invest 

Read also: Investors focus on system changes at the LOIM Transition Investment Summit

Navigating political noise

MacDonald-Brown started by asking whether conversations internally or with clients had changed given policy shifts and messaging from the US administration that has been perceived as hostile to the net zero transition.

Panelists acknowledged the impact, saying that investment managers face tough choices in the current climate, particularly those in the US.

“But ultimately, there are 600 million people in Africa that don’t have access to electricity – there’s a massive investment opportunity there,” Fawcett said. “We can ignore a lot of the rhetoric from the US, and just focus on where we can make money for our members and also have an impact on climate change”.

They also stressed the importance of alignment and philosophical consistency, noting how today’s challenges help distinguish those who are truly committed to sustainability issues from those who are not.

A core investment principle

A recurring theme was the need to keep sustainability from being siloed. Instead, it must be embedded in every investment decision.

“Sustainable investing isn't a product opportunity,” Fawcett said. “It should be in your DNA”.

Wall echoed this sentiment, arguing that sustainable investing is not only the right thing to do – it’s also the profitable thing to do.

“Ultimately we're all here to be stewards of people's wealth,” she said. “You want to have risk-adjusted returns, therefore environmental, social and governance risks and risk mitigations must be absolutely central to your investment philosophy.”

Read also: How can the net-zero theme add value for investors?

The investors emphasised the need for a consistent sustainable investment framework across geographies, and said engagement is the preferred strategy for attempting to drive change.

“Our main strategy is not to divest,” Fawcett said. “It’s to try and have conversations, have influence, work with other asset owners to have an impact. But it's hard. It is really, really tough.”

The conversation also turned to asset classes. Private markets were seen as offering greater potential for impact on driving the transition. Wall noted that retail investors often accept longer time horizons in private markets, which aligns well with the nature of sustainable investments.

Rethinking terminology

Both MacDonald-Brown and Wall shared views on the diminished effectiveness of traditional sustainability terminology.

“I would eradicate all concepts of sustainable investing – all references to ESG, even climate change and global warming,” Wall said, advocating instead for a focus on outcomes and the true meaning of sustainability: enduring value. “I think it would transform the mission and engagement.”

MacDonald-Brown agreed, even proposing the term `persistent’ as a replacement for `sustainable’.

“What you are really looking for is businesses that are going to be persistent in an economy that will be net zero and nature positive because it has to be,” MacDonald-Brown said.

The message was unanimous: sustainable investing is not a passing phase or a political statement—it’s a long-term imperative. Amid noise, setbacks and scepticism, these asset owners are not rowing back on commitments. Rather, they have made sustainability central to their investment philosophy.

“Our thinking has evolved around ESG, as the whole world’s thinking has evolved, but ultimately we think it's our responsibility to manage ESG risks along with all other risks for our members”, Fawcett said. “This is about embedding sustainable investing throughout the whole of a person's lifetime of investing.”