April 2021 | Issue 233
Opinion ESG
If we have to rely on top-down global political coordination we are all doomed
quotation mark
ESG can’t be dictated to us by authorities. It’s a way of life
Such is the urgency with which ESG and impact investment is gathering pace, no firm can afford to sit on its hands waiting for government regulations or industry standardisation to show them the way. Getting ahead of the pack will be one of the biggest competitive differentiators between success and failure in the business of the very near future.

This edition of Creditflux is testament to the changing ESG landscape. There are numerous threads running through the articles, and clear indications these criteria are fast extending to every part of the credit spectrum.
In truth it’s raised my morale no end after a month in which I contemplated rather too keenly how much there is to do in the world, and how little time — although this mood is coloured by rising frustration with Welsh lockdown restrictions, which engender days where the highlight could be fighting my way into an unusually stubborn packet of Leerdammer slices.
This week at least began positively when I read how, many years on, Sir Paul McCartney had settled his ‘debt’ to a woman in Wales for borrowing a blanket in 1958 when he and George Harrison had camped in a tent on her Harlech farm as teenagers. Such heart-warming anecdotes are a reminder to always hold in mind where we come from, the journey that got us where we are, and the people who showed us kindness along the way.
But fast forward a day — and to 2021 culture. I note Nike is suing Brooklyn art collective MSCHF for trademark infringement after it sold 666 pairs of $1,018 modified Air Max “Satan Shoes” that contain human blood in the soles. A collaborative video on YouTube shows rapper Lil Nas X sliding down a stripper pole from heaven to hell to steal Satan’s horns, while wearing the trainers that reference Bible verse Luke 10:18: “So He told them, ‘I saw Satan fall like lightning from heaven’.”
There is so much about modern capitalism here distilled in one drop, I doubt even Karl Marx would know where to start — and none of it provides much assurance capitalism can improve life, or itself be saved. Although, on this evidence, the jury is also out on art, sportswear, music, religion and even pole-dancing.
Whether financial markets are fit for purpose to solve modern problems is no longer a philosophical question, even for those of us head down in them every day. Former BlackRock ESG chief investment officer Tariq Fancy is doing the rounds in the media claiming that responsible investment criteria are like “selling wheatgrass to a cancer patient” and are actually harmful.
While I sympathise that much of today’s ESG box-ticking is just that — a free market “rush to gather assets”, as Fancy puts it — I can’t get behind his conclusion that government action is the only viable fix.
As much as I hope the Biden administration will finally bring the US back on track with climate initiatives, if we have to rely on top-down global political coordination we are all doomed. New Netflix documentary Seaspiracy — another of the past month’s bleaker musings — claims we are sleepwalking toward lifeless oceans by 2048, lulled by misleading ‘sustainable’ stamps on produce from deeply compromised overseers. It sounds familiar.
It is up to all of us
Real change has to start with ourselves, the organisations and systems we build around us, and infuse everything we do. Even the seemingly less intractable areas of ESG — the social and governance goals — have been shown time and again of late to have a long way to go.
Away from all the upbeat LinkedIn posts about International Women’s Day, in the UK at least March can’t be said to have been a good month for women. The murder of Sarah Everard, police heavy-handedness in dealing with her vigil, as well as the efforts of a prominent male TV pundit to rubbish Meghan Markle’s relaying of her experiences regarding race and mental health all show how challenging it remains for half of our society to feel safe and be heard.
Our industry’s focus on bringing diversity to senior positions is all well and good, but true social impact will be very limited if we only ever direct this gaze upwards, with an aspirational eye.
Share this article:
Global credit funds & CLO's
April 2021
| Issue 233
Published in London & New York.
Copyright Creditflux. All rights reserved. Check our Privacy Policy and our Terms of Use.