Speaker 1: This is Bloomberg Business Week with Carol Messer and Bloomberg
Speaker 1: Quick Takes Tim Stinovic on Bloomberg Radio. Well, well, Chile
Speaker 1: on Wall Street, certainly in the first half of Chile
Speaker 1: in my studio as well, and Chili when it comes
Speaker 1: to E s G, because in May, investors made the
Speaker 1: biggest ever monthly redemptions from US exchange traded e s
Speaker 1: G funds based on Bloomberg Intelligence estimates. So let's get
Speaker 1: to our guests see what she and her team are
Speaker 1: seeing when it comes to impact investing in E s G.
Speaker 1: Sarah Bratton hughes his head of E s G and
Speaker 1: Sustainable Investing in America's Century Investments. She joins us phone
Speaker 1: on the phone from New York City. American Century. By
Speaker 1: the way, they're controlling owner is the biomedical research organizations
Speaker 1: Stower's Institute for Medical Research. The firm directs its profits
Speaker 1: to their efforts to defeat life threatening diseases. So uh,
Speaker 1: they're not only investing for others. They really are kind
Speaker 1: of walking the talk. Sarah, nice to have you here
Speaker 1: with Mike and myself. What interest are you seeing an
Speaker 1: E s G right now amid all the market volatility
Speaker 1: thank you for having me, Carroll. We are still seeing
Speaker 1: UM increased interest and E s G and sustainable investing.
Speaker 1: Although those headlines about redemptions, although the redemptions have gathered headlines,
Speaker 1: you can't really look at them in a vacuum. You
Speaker 1: have to look at them versus the broader market as well.
Speaker 1: So UH, this year we conducted the fifth edition of
Speaker 1: our Impact Investing survey, and there were some really interesting
Speaker 1: UH findings and there are all just talk about these
Speaker 1: three things that really surprised me. UM Here in the
Speaker 1: US we've seen increased appeal of impact investing. But interestingly,
Speaker 1: it was probably the first or only survey I've ever
Speaker 1: seen that men had preferred impact investing over a woman.
Speaker 1: And when you really killed back the onion and looked
Speaker 1: at the numbers, what you saw was actually, there's a
Speaker 1: delta around what the education and impact investing is for
Speaker 1: a woman, UH, particularly in the baby boomer generation. So
Speaker 1: as we think about the transfer of wealth, UM, people
Speaker 1: often talk about the intergenerational transfer of wealth, but I
Speaker 1: like to think of it first as an intergender transformation
Speaker 1: of wealth. What we've also noticed is the dominance dominance
Speaker 1: of the S factors in the U S so UM consistently.
Speaker 1: UM U S investors, when they're looking at the factors
Speaker 1: that they want to impact consistently have had more appeal
Speaker 1: in S factors than our global counterparts. So what we
Speaker 1: have observed this year again, healthcare is the most important
Speaker 1: factor from a US perspective. Climate is up there second,
Speaker 1: but there isn't another E factor from a U S perspective,
Speaker 1: UM whereas that is dominating, Climate dominates the UK, Germany
Speaker 1: and Australia. And then the third and final that is
Speaker 1: on greenwashing, where over fifty of the investors were concerned
Speaker 1: about greenwashing. I would actually, Carol, think that number was
Speaker 1: higher Vay within marketing. I would agree. I would agree
Speaker 1: because I really do feel like anything with the s
Speaker 1: G and impact, people are like, Okay, enough of it.
Speaker 1: We've seen a ton of money go into it. Now
Speaker 1: show me that you're really doing it. Mike, do you
Speaker 1: feel the same way. Yeah, well, you know, Carol, it's
Speaker 1: sitting again, Sarah. There's certainly been a bit of a
Speaker 1: backlash from the right side of the political aisle towards
Speaker 1: the notion of the SG in general. Sarah. I'm wondering
Speaker 1: if you view that as any sort of legitimate risk
Speaker 1: going forward, especially no as these mid term elections come
Speaker 1: up and a lot of people expecting the Republicans to
Speaker 1: gain House and gained seats in Congress. Is there is
Speaker 1: this backlash sort of in the early phases. But I
Speaker 1: wonder if is it a real risk to do you think?
Speaker 1: How are you thinking about it? So I look at
Speaker 1: what has really resulted in the rise of the SG investing,
Speaker 1: and it's UM the continued UM demand we've seen from
Speaker 1: a BOLT in a retail client perspective, but also institutional clients. UM.
Speaker 1: It is the economic argument for it when you've seen
Speaker 1: this massive rise of intangibles on balance sheets. You look
Speaker 1: at the amount of intangibles on balance sheets in thenteen
Speaker 1: seventy five which just seventa the last figures and were
Speaker 1: over twenty UM or over N. But I think the
Speaker 1: biggest thing is the policy environment. So according to the
Speaker 1: u N Principles for Responsible Investing, the top fifty out
Speaker 1: of the top fifty economy have some form of policy
Speaker 1: designed to help investors consider sustainability, risks, opportunities and outcomes UM.
Speaker 1: And for the long longest time, the US was the
Speaker 1: outlier UM in terms of policies that we're providing kail
Speaker 1: winds were sustainable investing UM and and now we we
Speaker 1: may become the outlier again. However, what we're seeing happening
Speaker 1: in the rest of the world, particularly Europe, is going
Speaker 1: to continue to provide kail winds UM. Interestingly this week
Speaker 1: and there's a lot of conversation about the SEC and
Speaker 1: their climate disclosures that the EU UH has actually vary quietly.
Speaker 1: UM reached a provisional agreement that we require UH non
Speaker 1: EU they companies with later million euros of a u
Speaker 1: M to have provide report on their E s G
Speaker 1: impacts UM and it's it's defined and it's going to
Speaker 1: be legally mandated for US company persons over there. Yeah,
Speaker 1: especially on this, I do feel like we're looking largely
Speaker 1: to Europe in terms of what they're doing. It does
Speaker 1: feel like though a moment of reckoning when it comes
Speaker 1: to UH impact investing, and I think investors are increasingly
Speaker 1: demanding it. Sara, we scratched the surface. Hopefully we can
Speaker 1: continue this conversation in the future. I know it's something
Speaker 1: we talked about a lot here at Bloomberg. Sarah Bratton Hughes,
Speaker 1: She's head of E, s G and Sustainable Investing at
Speaker 1: America American Century Investments, joining us on the phone from
Speaker 1: New York City. I mean, like the amount of money.
Speaker 1: I think Bloomberg Intelligence expects something like fifty trillion by
Speaker 1: so yeah, I mean it just keeps coming