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[ ESG ]
“All the car manufacturers
are now transitioning to
electric cars and in 15 or
20 years, people will say ‘I
can’t believe the air I was
breathing’”
Self-fulfilling prophecy
McAlevey believes the trend towards
socially responsible investing could
become a self-fulfilling prophecy:
“With investors demanding greater
standards, more money will go into
companies with higher ESG scores,
pushing up share prices.”
There are still sceptics who maintain
the belief that a focus on anything
There are signs tobacco’s best days
ethical will be down to pressure from
are behind it, with stringent taxation PR departments rather than any
making it unaffordable and vaping –
desire from the fund manager.
which has minimal barriers to entry –
You may attach more meaning to
offering a cheaper, but less profitable, the words of someone like Sorrell,
alternative; the FTSE 350 Tobacco
who doesn’t feel the need to toe a
index has lost a quarter of its value in particular line. It is worth bearing in
the past year. However, the point is
mind though that while he turned a
that if an industry with rock-bottom
small basket maker into one of the
ESG scores has outperformed over
planet’s biggest advertising firms, he
the long term, what is to stop a repeat was forced to step down from WPP
of this in the future? For Dudley, the
this year when his behaviour fell
world is now a different place.
short of the company’s own ethical
“There is a general trend towards
standards. This serves as a reminder
health and wellness, and products like of one of the most important rules of
tobacco don’t fit into that,” she says.
investing: things always change.
Lode points out this can be seen in
other industries as well.
“All the car manufacturers are now
transitioning to electric cars and in
15 or 20 years, people will say ‘I can’t
believe the air I was breathing’.”
“It is like smoking, people used to
smoke on planes and in restaurants,
but people hated it and now it is not
acceptable. It will probably be the same
with all the car fumes in London.”
trustnet.com