Rob Stewart (RS): You talk to a lot of our clients quite often – what are the areas that they are talking to you about on the ESG front?

Hanneke Smits (HS): They do talk a lot about diversity. They do want to understand how at Newton we are ensuring that our workforce becomes even more diverse than it already is – and not just by gender, but by ethnic and socio-economic background, because there are now a number of studies, including a recent one that McKinsey produced, that clearly demonstrate that companies that have a more diverse workforce, including investment organisations, should deliver better results. Ultimately, we are here to drive investment results for our clients so that is a very important topic for them which we talk about a fair bit. Increasingly, it has also been about climate change, carbon footprint. Some of our clients have to deal with some of those topics and have to report on it too, so at times it becomes a sharing of how we actually deal with these issues – we at Newton and the client – so it can become a mutual learning opportunity as well.

RS: Do you think we’ve got a way to go with our approach to climate change?

HS: With climate change we do. I think it is a trickier topic to tackle from a definitional perspective, and you and I have had a number of conversations about this. I think it’s a very important topic and also the commitment to 2 degrees [limiting global warming to 2 degrees Celsius] I think is very, very important. How you implement that at Newton, in terms of thinking about how you allocate capital, but also how you change behaviour of your own employees, I think we are just working through the detail of that.

RS: That’s something that we’ll be looking to work on over the next year isn’t it?

HS: Yes, we are.

CEO Hanneke Smits discusses Newton clients’ sustainable investment requirements.