FEM logo
Fund EcoMarket

the sustainable, responsible and ethical investment information hub

A collection of responses to HSBC’s Kirk extraordinary climate speech

May 27th, 2022

Earlier this week I set out my initial response to HSBC’s head of Responsible Investment – Stuart Kirk’s – extraordinary presentation on climate risk  (see blog linked below).

In the interest of understanding different points of view – here is a collection of  articles and opinions about his speech that we believe are relevant to UK financial services professionals.

You will see that opinions are quite varied. ‘Unfiltered’.

As hard as this is for many of us to go along with – understanding different opinions remains important.

In spite of all of the problems climate change is causing around the world today –  the associated human pain and infrastructure costs, and the knowledge that this is just the beginning – there are evidently people in responsible investment (and important positions) who do not think that climate change is a financial risk – and are prepared to role the dice, favouring ‘adaptation’ .

Given that I believe climate change is a massive risk for investors – and an existential threat for human kind (and some other species) –  I won’t be sitting on the fence.

But I will try to understand and respond to other perspectives.  Indeed, like many ‘old hands’ in sustainable investing I spent many years doing so ‘pre Paris (2015)’.

I won’t analyse the responses in detail in this blog, but I can’t avoid saying that the views of ‘conventional economists’ were unable to be challenged for far too long – which will have been one of the key reasons why the ESG floodgates opened as far and as fast as they did after 2015…  (markets are not perfect, there is no such thing as an ‘externality’ on a finite planet etc)

If we are to progress towards net zero with the necessary urgency the (real) responsible investment community (as well as regulators, policymakers, clients and others) needs to be aware of,  understand and respond to differences in opinion  –  preferably without the kinds of insults Mr Kirk employed (as amusing as some were).

It won’t always make sense to do so, but understanding and reflecting on different perspectives might just help us to move forward faster than we are at present…

And a final thought – our Fund EcoMarket database lists 140 primary funds where their managers have told us the fund is covered by a  ‘Published ‘CEO Owned’ climate risk policy‘ *.

Stuart Kirk was senior (and almost certainly in the wrong job) – but he was not CEO.  And that matters.

(*see the ‘Responsible Ownership’ field, ‘Other company features’ column).

‘Man who jumps on bandwagon accuses fellow passengers of being on bandwagon’

Media comments following Mr Kirks presentation (May 2022)

HSBC AM’s ‘head of irresponsible investment’ condemned over climate speech (James Baxter-Harrington) – Investment Week (20/5/22)

Includes reactions to the statement from professionals in the sector, who disagreed with / puzzled by Kirk’s words.

  • Gavin Haynes, co-founder of Fairview Investing: labelled speech “totally bizarre”.
  • Louisiana Salge senior sustainability specialist, EQ Investors: suggested that many of Kirk’s comments “seemed to directly conflict with the science” “His entire speech was trying to explain the lack of climate change impact on finance – he ignored the responsibility of finance in impacting the climate and our transition”
  • Hortense Bioy, Morningstar: “a classic ‘tragedy of the horizon’ type of comment”
  • Beau O’Sullivan, senior campaigner on the Bank on our Future campaign: speech was “regressive and grossly flawed”. “Climate change does pose a material risk to financial assets.”

Many questioned the efficacy of HSBC’s ESG products especially in light of ASA greenwashing accusations:

  • Gavin Haynes – Fairview: “HSBC as a group have already been under fire for their misleading approach to how they promote green initiatives,” “Culture in an organisation is important when looking for credible ESG investment providers and such views make it very difficult to consider HSBC’s ESG fund range.”
  • Darius McDermott, Chelsea Financial Services: investors in sustainable fund range now have “reason to review” their investments. “It is certainly confusing for investors and at the very least mixed messages”
  • Louisiana Salge, EQ Investors: “No doubt this will influence other investors that are investing with a sustainable objective and are conscious of the responsibility that comes with stewarding their clients’ capital.”
  • Julia Dreblow, founding director of SRI Services: “this will force HSBC’s hand. If there is no correction issued and no heads roll, we will know a lot more about HSBC than we did a few days ago.”
  • Beau O’Sullivan, Bank on our Future campaign: “Pension fund clients should note that HSBC Global Asset Management might not be as serious about protecting their capital from the effects of climate change as it claims to be, and they should be looking for a more responsible asset manager.”

As a consequence of speech, company processes need to be more robust & transparent about ESG & Climate change:

  • John Fleetwood, director of responsible and sustainable investing at Square Mile Research: “Climate considerations should now be embedded at all levels of a company’s culture… Confidence in a company’s ESG processes can only be maintained if its messages are clear and consistent.”
  • Salge, EQ: “I am worried that this type of behaviour and tone will be the very reason why we will fail to use ‘big finance’ as a lever to enact the change we need.”

 

HSBC suspends Stuart Kirk over climate change ‘hyperbole’ speech (James Baxter-Derrington) – Investment Week (23/5/22)

The article provides a brief overview of Kirk’s speech and HSBC’s reaction, which is to suspend him pending an internal investigation.

Senior executives at HSBC eager to distance themselves from Kirk’s speech, despite the fact its theme and content had reportedly been agreed internally before the presentation was given.

  • Nicolaus Moreau, CEO, HSBC Global AM: Kirk’s remarks “do not reflect the views of HSBC Asset Management nor HSBC Group in any way”.
  • Moreau stated: climate change was “one of the most serious emergencies facing the planet” and HSBC was committed to a sustainable future.”
  • Noel Quinn, HSBC group CEO: said he did “not agree at all” with Kirk’s speech, adding it was “inconsistent with HSBC’s strategy and do not reflect the views of senior leadership”.
  • Quinn added: firm’s ambition was to be “the leading bank supporting the global economy in the transition to net zero” and remained “fully committed to a net zero future”.
  • Nuno Matos, HSBC chief executive of wealth and personal banking: in “complete agreement” with Quinn, adding the transition to net zero was of utmost importance to the firm.

 

Not so moral money? BusinessGreen editor hits back at Stuart Kirk’s climate risk speech (James Murray) – Investment Week (23/5/22)

Reacts to Kirk’s claims and counters his arguments in defence of climate change.

  • Kirk’s speech is one shared by many investors and top executives – the ‘let’s just adapt’ to climate change argument the likes of Bjorn Lomborg and Matt Ridley have been pedalling for over a decade.
  • Kirk’s speech is dangerous. It highlights how critics of the net zero transition hope to exploit the cost-of-living crisis to delay and dilute climate action
  • Kirk’s claims he takes “a very financial and investment view of the topic”. Murray argues this view of climate risk should still incorporate the very risks Kirk insists we should not worry about.
  • Kirk’s overarching argument: warming of circa 2C to 3C is “not a financial risk that we need to worry about”. Murray: it is true that humanity might find ways to mitigate and adapt to these impacts…but …such substantial and interlocking impacts could present a financial risk that is worth considering..”
  • Kirk is guilty of a long-standing error about the nature of risk. “past performance is not indicative of future results”. At the end of the Boy Who Cries Wolf, there is a wolf.
  • Kirk claimed that Y2K digital disaster concerns were overblown. However, Paul Saffo, professor at Stanford University stated “The Y2K crisis didn’t happen precisely because people started preparing for it over a decade in advance.”
  • Kirk’s real frustration with climate stems from “the amount of work these people make me do”. His team are “being asked to look at something that is going to happen in 20 and 30 years hence” at a time when they also have to deal with crypto, US regulators, China, a looming housing crisis, and soaring inflation.
  • Murray: the above argument could gain traction in this current economic and political climate however Kirk’s claim that “markets are crashing around our ears today for nothing to do with climate whatsoever” does not stand up to even the most cursory scrutiny and provides examples:
    • World Meteorological Organisation recently published report detailing how four key climate change indicators – greenhouse gas concentrations, sea level rise, ocean heat, and ocean acidification – all set new records in 2021
    • Primary trigger for the current economic crisis is a war waged by a petrostate which has led to surging energy costs, which would be considerably less of a problem if governments had introduced more ambitious energy efficiency and domestic renewables programmes.
    • Food security crisis has been further exacerbated by record heatwaves in India that have forced the government to block wheat exports
  • Kirk also claims: “we can adapt to.. (Climate change) …we will cope with it.”
  • Murray counters: “The crux of Kirk’s argument is that civilisation should play chicken with the habitability of the biosphere and not even bother to think about the prospect of this gamble going wrong.”

Article points out that Kirk’s speech is at its most interesting and revealing in its dismissal of the stranded assets hypothesis, a view widely held in financial circles.

  • Kirk: “average loan length…is six years. What happens to the planet in year seven is actually irrelevant”
  • Kirk: “the Mark Carneys of this world have to convince us all that every single one of us is wrong on climate risk. That’s possible, but it’s a big call to make.”
  • Murray: It is a big call, but it is also not like the entire financial industry has never been collectively wrong about systemic risks.
  • Murray: Carbon Tracker think tank has repeatedly pointed out, investors who dismiss the prospect of stranded assets are engaged in a high-risk strategy.

Kirk concludes by confidently predicting that the 21st century will enjoy the same long term economic growth rates enjoyed throughout the past century

  • Murray: He may well be right…if he is, it will because policymakers, business leaders, investors, entrepreneurs, and the wider public actively rejected such complacency and treated the immense climate risks the global economy is facing with the seriousness they demand.

 

HSBC exec suspended for ESG comments brought ‘dose of honesty’ to debate, ex-BlackRock sustainable investing chief says (David Ricketts) Financial News (23/5/22)

  • Tariq Fancy, who was BlackRock’s sustainable investing CIO between 2018 and 2019: Kirk’s remarks were controversial, (but) he has “done us a service” by “infusing a dose of honesty into a debate that is otherwise leading us nowhere”.

 

Industry asks ‘what sort of culture HSBC is breeding’ in wake of Stuart Kirk suspension (James Baxter-Derrington) – Investment Week (23/5/22)

Article questions HSBC’s  links to Kirk’s speech, despite their attempts to distance themselves from it.

  • Global heads of HSBC have argued that it does not reflect the group’s stance on climate change.
  • However, FT reported that the presentation was signed off internally and was known to the firm for at least two months in advance, raising questions about the sincerity of its recent claims of climate credentials, and whether Kirk’s comments were as “rogue” as they have been made out.
  • Gavin Haynes, co-founder, Fairview Investing: “hard to see how HSBC can claim Stuart Kirk’s views were rogue and not authorised”.
  • Darius McDermott, managing director at Chelsea Financial Services: speech “was not the right message, particularly for someone in that position”
  • Beau O’Sullivan , senior campaigner, Bank on our Future: the internal backlash opened a “new can of worms” for HSBC “The bank must now explain how such offensive and inaccurate comments were signed off, to what extent other senior executives share Kirk’s views and what sort of culture HSBC is breeding that allowed the comments to pass unchallenged”
  • Julia Dreblow, founder SRI Services: “My biggest question, given that the presentation was pre-approved and that he has now been suspended: Does the HSBC compliance team not understand climate risk?”

 

Free speech row erupts after HSBC suspends banker over climate change criticism (Tom Rees & Louise Moon) – Daily Telegraph (23/5/22)

Article defends free speech:

  • Bill Winters, CEO Standard Chartered: “it’s increasingly difficult to speak out against anything”

Kirk shouldn’t have been suspended

  • Winters hinted that he would not have suspended Mr. Kirk, calling the presentation “very colourful”
  • Jean-Marc Ollagnier, Accenture’s Europe boss: said that he would not suspend an employee if they gave views in a personal capacity, adding it is “not our job to judge” employees’ views.

Concerns about hypocrisy:

  • There is a push to reconsider fossil fuel investment in light of the energy crisis due to Ukraine invasion.
  • In Britain, ministers are pressing oil and gas companies to invest in new projects in the North Sea just months after the COP26 climate change conference.
  • Human rights activists accused HSBC of hypocrisy for preventing discussion of climate change while refusing to condemn a brutal crackdown on dissent in Hong Kong, where it makes most of its money.
  • Head of Serco compared ethical investors to “people who eat sausages, but don’t want to know how they are made” (December 21). Warned that a reluctance to back defence companies was putting national security at risk…
  • There are wider concerns in the City that a fad for ‘ethical’ investment is shutting down debate.

 

HSBC suspends exec who slammed ‘nut job’ climate change risk warnings (Thomas Barrabi) – New York Post (23/5/22)

Article outlines the speech and includes some comments from professionals:

  • Bill Winters, CEO Standard Chartered: “Do I agree with the views? No. Do I encourage free speech? Yes, People should be able to speak their mind, whether you agree with the conclusions or not,”
  • A former Blackrock executive focused on sustainable investment said Kirk’s remarks had “done us a service” in discussions on climate change risk by “infusing a dose of honesty into a debate that is otherwise leading us nowhere,”

 

Stuart Kirk boldly goes where no global head of responsible investing has gone before (John Lappin) – Octo Members (23/5/22)

Lappin responds to Kirk’s speech, which he states is “not a rant and may even have some merit” and feels that Kirk may not have been suspended had he “removed a few of the more injudicious comments and phrases”

  • The real issue… is that fund buyers started asking questions. Journalists started asking questions and then the CEO had to disown the comments too.

He goes on to highlight what he believes are the most interesting parts of the speech:

  • Falling volumes may not mean falling profitability
  • Stranded assets are a limited risk due to time horizons
  • Central banks adding unmerited policy shocks
  • Market has progressed through all manner of crises, while full foresight is near impossible

With the following comments:

  • The most powerful point concerns central banks’ scenarios which may well be painting too bleak a picture. Are they allowed to be alarmist when sounding the alarm? It begs questions of some of the growing PRA requirements. Is this the basis for an important debate?
  • The issue with volume is of most concern for advisers and portfolios. This seems to suggest that the best run non-sustainable businesses (in climate terms) can prosper. This part of the speech should be tested among asset managers and allocators.
  • A lot is going to depend on regulation and, by and large governments are going to keep working at the problem.
  • Pandemic, recession, QE and all make it very difficult to draw any conclusions – negative or positive – from the relative level of shares currently.
  • It may be fair of Kirk to question the IPCC on GDP 80 years’ hence, but the science is unlikely to be wrong, so unsure that the disaster point holds.
  • Kirk was not denying the importance of transition nor even of climate change however with the language he used, and the confidence that we will definitely work it out and adapt, his point is very close to the arguments sceptics offer, many of whom do not really have a coherent case.
  • Finally, there are two arguments (points 2 and 3 above) where there are grounds for debate on central banks’ projections and on relative performance of shares and stranded assets. Should the global head of responsible investing at HSBC Asset Management be making them? Quite possibly yes. But the speech and the slides needed a rewrite and it’s too late now!

 

HSBC ‘climate-gate’ set to sharpen investor due diligence – Capital Monitor (24/5/22)

Article touches on argument that Kirk’s speech may reflect HSBC’s wider thinking on climate change, despite their protestations to the contrary. HSBC sponsored FT event as ‘strategy partner’, branding on Kirk’s speech

  • Adam McGibbon, UK campaign lead at non-government organisation Market Forces, feel Kirk’s comments are a truer reflection of HSBC’s real attitude to climate, given their continued heavy financing of fossil fuels, including coal.

Article also argues that many will increase their focus on climate change, rather than lead them to link it has been overplayed.

  • Simon O’Connor, chief executive – Responsible Investment Association of Australasia (RIAA): “Scrutiny of asset managers by asset owners – and indeed by retail and wholesale clients – has been rising dramatically in the past year, with net-zero commitments adding further impetus to this trend.
  • Mike Clark, Ario Advisory: Asset owners should – and probably now will – increase their due diligence of where fund managers stand on climate risk

Many are not surprised by Kirk’s comments and believe some financial services executives hold this view:

  • Wolfgang Kuhn, an independent consultant (formerly of ShareAction): Many in the industry will hold views similar to Kirk’s “otherwise we would see more action [on climate], and divestment [of polluting assets] wouldn’t be questioned constantly”.

Article also touches on whether he should have been suspended – unfair, is he a scapegoat?

  • Mike Clark: “we don’t know where HSBC stands”, “If (speech) was signed off internally, then HSBC Asset Management – at least – have got some explaining to do.”

Failure of Governance at HSBC. One positive message – the need for tighter due diligence both internally and by clients.

 

HSBC’s responsible investing chief was ‘spot on’, say advisers (Sally Hickey) – FT Adviser (24/5/22)

Article has included comments from advisers who have agreed with Kirk

  • Climate change a sham – Nick Lincoln, director at Values To Vision Financial Planning
  • Don’t panic…people are being conditioned to panic outrageously” – Greg Neall, Wake Up To Your Wealth
  • “I find some of the comments very controversial, but his point about financial risk I find to be correct” – Greg Neall, Wake Up To Your Wealth
  • Praises Kirk for “telling the truth about anthropogenic climate change.” Tim Price, portfolio manager at Price Value Partners
  • Comments are “bizarre” / “He lays himself open to the charge of lazy complacency and that he was out of touch with the human beings who are suffering right now and who will suffer in the future as a result of climate change.” – James Evans, chartered financial planner at Morgan Williams & Co

 

HSBC’s Suspended Banker Taken to Task by Key Architect of ESG – Bloomberg UK (24/5/22)

Discussion of varying opinions about the Kirk speech. References some of the issues surrounding ESG. Still some way to go in the sector.

Paul Clements-Hunt comments: (the man who helped coin the acronym ESG in the mid-2000s)

  • “He represents yesterday’s bank executive,” “Ninety-five percent of the world’s scientists agree that climate is a huge risk.”
  • it would be wrong for the ESG industry to ignore the critics.
  • “I welcome the debate,” ESG was a kind of “virus we planted in 2004,” and it’s clear it posed a “threat to proponents of traditional finance because it was based on their own thinking and language, that is, material risks and fiduciary responsibility.”
  • The next few years will see a “shakeout” of the ESG industry. “Sustainability has been co-opted by opportunistic forces in the market. The market has run ahead of itself,” but “these are all growing pains,”

Sasja Beslik, author of “Where the Money Tree Grows”:

  • “expressing what many bankers think when the media isn’t around.” “there is a lot of silent resistance to ESG in many big houses, partly due to the fact that bankers know that not everything they do is always ESG kosher.” –
  • the Kirk comments ultimately “give you a good temperature on where ESG is,” and that’s “still mostly on the PR side.”

Matt Moscardi, an ESG consultant

  • there will be unintended positive consequences of Kirk’s remarks.
  • “I don’t agree with what a single word he said but all of this is exposing the gap between marketing and execution of ESG,” he said. “The best outcome is that every single asset manager and investment banker will start telling clients what exactly they are trying to achieve with ESG.”

 

Mark Dampier: HSBC’s Stuart Kirk was spot on about ESG – Financial News (24/5/22) (Former head of research at Hargreaves Lansdowne)

Brief overview of history of Ethical funds (no real stats) and broad difficulties surrounding ESG (categorising good & bad is difficult) Questions ESG credibity.

  • He feels sorry for Kirk – “His comments struck me as being spot on.”
  • “Climate change has become a trillion-pound industry spawning more hangers-on, think-tanks, green publications and pressure groups than surely any other industry today. All have a vested interest in keeping the status quo, so they strongly dislike people raining on their parade.”
  • “What Stuart Kirk was surely saying was that, in terms of risk, we can take action to reduce climate change, but we can’t know for sure whether it will work”
  • References Danish author Bjørn Lomborg (an advocate of adaption) and his book ‘False Alarm’
  • “The problem we have today seems the inability to talk about difficult subjects and to challenge the consensus”
  • “ironic that the fund management industry, where great managers have the ability to think more laterally, is being steamrolled into an ESG bandwagon? But then, an industry that now has £2.7tn of assets under that umbrella has a tendency to do that.”

 

ESG’s power grows as banker is canceled for talking sense on climate change (Rupert Darwall) New York Post (24/5/22)

Article defends Kirk’s comments and argues against ESG.

  • Four hundred years ago, people were burnt at the stake for believing the wrong things about religion. Today, they get fired for questioning the climate-change catechism.
  • Central banks and financial regulators are using every regulatory weapon in their armories to suppress investment in fossil fuels and direct capital flows toward renewables like wind and solar, as a result of Paris Climate agreement.
  • Distorted, alarmist climate reporting is the norm — and getting worse

 

Five takeaways for asset managers stunned by Stuart Kirk’s sustainability slur (Esther Armstrong) – LinkedIn (24/5/22)

  • Communications disaster for HSBC
  • Wake up call for Asset Managers – 5 points to consider
    • Have to be held to account – Journalists & professional funde selectors are doing this more, which is good
    • Evidence – not enough to say you are sustainable & responsible – mean it and evidence it
    • Don’t allow individuals to ‘go rogue’ under corporate umbrella
    • The truth will always come out
    • Being thought provoking needn’t be inflammatory. – the funding of innovation and adaptation will be crucial to achieving the transition to net zero.
  • Asset managers have to deal with the aftermath of Kirk’s speech with urgency in order to protect their reputation, product and brand relevance

 

The Stock Market And Climate Change: A Very Provocative Speech By Stuart Kirk (Robert G. Eccles) – Forbes (24/5/22)

Article provides an overview of Kirk’s speech: growth is a central theme; Kirk is also upset with regulators and compliance costs and critical of those expressing concerns over climate change.

Article also touches on the press reaction:

  • The Wall Street Journal applauded his speech saying “But he merely said what many in his industry believe but are too timid to say: Climate change poses a negligible risk to the global economy and bank balance sheets.”
  • The New York Times doesn’t explicitly take a position but it does call out some of Mr. Kirk’s more provocative comments such as comparing the climate crisis to Y2K

Article then goes on to raise issues where the author struggles with Kirk’s logic.

  • Doesn’t understand how Kirk really feels about investors:
    • argues that if climate change really was a big problem, it would be captured by the market, implying it should be flat or going down. But he sees investors as “smart” and rightly discounting the hue and cry about climate change
    • Kirk doesn’t acknowledge is that it is investors, including HSBC Asset Management, not just central bankers and regulators, who are deeply concerned about climate change and are working hard to create investment strategies to deal with it. So maybe they’re not so smart after all?
  • Time frames:
    • Kirk talk about short-term orientation of the bank. “what happens after seven years is irrelevant.” Stock price “valuation does not take into account anything that happens after 20 years.”
    • So, if things really go really pear shaped due to climate change, the market will take a big hit?
  • Adaptation:
    • Kirk: “Human beings are spectacularly good at managing change.” “Adaptation is cheap and effective” – more money and attention should be focused on adaptation than is the case today.
    • If we need to start thinking harder about adaptation, this amounts to giving up and the necessary focus on mitigation will disappear.
    • Although wars, financial crises and pandemics all have major global impacts, it is also possible for the world to recover from them. Climate change is a different category. It is a systemic risk which society will find impossible to reverse if climate change goes past a certain tipping point.
    • Kirk asserts that S&P 500 growth will continue but unless something dramatic happens increased wealth creation will be held by a smaller and smaller percentage of the population. The “World Inequality Report 2022” points out substantial income and wealth inequality both across countries (developed vs. developing) and within countries (of all types). Climate change will make this worse.

 

Former UN climate chief: HSBC speech ‘one of the most irresponsible public statements heard in years (Christiana Figueres) – Investment Week (25/5/22)

  • Brief discussion of HSBC’s standing in light of Kirk’s speech.
  • Kirk’s speech made it clear re severity of Climate change and the need to step up a gear.
  • Discusses the effects so far and states we have to “peak global emissions by 2025 and cut 50% of them by 2030”.
  • Two possibilities open to us – stay in denial (but shouldn’t then stay in leadership roles) or understand the science and act on it

 

Stuart Kirk is right – over-emotional discourse about climate change is distorting markets (Bill Blain) CapX (25/5/22)

  • Agrees with Kirk – thinks media has responded in a ‘hysterical’ manner and using ‘extreme’ quotes out of context.
  • Kirk’s arguments should be considered – focus of speech was on Mankind’s ability to adapt
  • Analysts have questioned its ESG culture, governance, ambition and stewardship in the wake of Kirk’s comments
  • Substantial danger that ESG is over-emotional, and that this is causing distortion.
  • Climate change is real but we have hysterical ESG distortions which are as much responsible for the West’s energy crisis as anything Vladimir Putin has done.

 

Asset managers divided by HSBC executive’s climate criticism (Harriet Agnew and Adrienne Klasa) – AFR.com / Financial Review (25/5/22)

Comments on both sides of the argument; some welcomed Mr Kirk’s willingness to expose groupthink and highlights some of the inconsistencies of ESG:

  • Desiree Fixler, the former head of sustainability at DWS “I welcome a contrarian view as sometimes the ESG market is overly one way,” “ESG has become such a tremendous fundraising machine that even the doubters have jumped on board.” “ESG is in danger of becoming a bureaucratic tax on investors and shareholders,” “We’re living in a world where ESG executives are paid on PR statements and aspirations rather than on actual impactful results.”
  • Hendrik du Toit, CEO, Ninety One: “This has given us all food for thought and encouraged healthy debate around the biggest existential topic of our time. It doesn’t change the fact that we need to address the climate challenge that impacts the vast majority of the world’s population and resonates far beyond the S&P 500.”
  • Petra Dismorr, CEO of consultancy NorthPeak Advisory: “It’s always good to have two sides of the debate. The biggest problem for ESG is that everything has become so polarised and politicised.”
  • Unnamed London based fund manager: “The ESG net zero zeitgeist is so all-powerful you just can’t stand in its way.”

Criticisms of Kirk’s speech:

  • Michelle Scrimgeour, chief executive at LGIM: “ESG factors are long-term financially material,” “We need to stay the course.”
  • Saker Nusseibeh, chief executive at Federated Hermes: “Real investment opportunities take long-term planning — include ESG factors — alongside traditional financial ones and require genuine engagement and dialogue with investee companies. If your time horizon is shorter, then that is an entirely different debate with different parameters and risk perspectives.”
  • John Ions, chief executive, Liontrust: “Climate risk is a risk that investors should be concerned about,” “Climate change, population migration and biodiversity loss are all things that affect companies and businesses.”
  • BlackRock chair and chief executive, Ions: climate transition marked “an important investment opportunity for investors to provide capital to new technologies and business models”.

Cowardly corporations have been captured by a form of group-think -Telegraph (25/5/22)

  • Suspending an HSBC executive for comments about climate change is an unjust response to pressure group criticism

 

Sign Up to our Newsletter

If you are a Financial Services Industry professional you can sign up for our newsletter

Click Here

Latest News

London Climate Week – (free) Excel event tickets – 28 & 29 June
June 15, 2022

  London Climate Week event on 28 & 29 June  I happily agreed to become involved with a major London Climate Week event run by Reset Connect some time ago. The event is now only two weeks away. I did so mostly because I am always keen to help and encourage intermediaries to learn about climate issues […]

A collection of responses to HSBC’s Kirk extraordinary climate speech
May 27, 2022

Earlier this week I set out my initial response to HSBC’s head of Responsible Investment – Stuart Kirk’s – extraordinary presentation on climate risk  (see blog linked below). In the interest of understanding different points of view – here is a collection of  articles and opinions about his speech that we believe are relevant to […]

‘Man who jumps on bandwagon accuses fellow passengers of being on bandwagon’
May 23, 2022
HSBC

…and has now been rightly suspended by HSBC. There is so much to say on this story, but let me start by saying I have no desire to ‘bash’ HSBC. Big banks are imperfect and have, in my view, propped up the fossil fuel industry for far too long – but that is not what […]