In this year’s summer series on PA Future, we have asked junior members of ESG/sustainability teams to answer our questions on career paths, red flags and personal passions, to showcase the ‘Next Generation‘ of talent coming through.
Candidates needed to be a member of a fund management, ESG/sustainability or stewardship/engagement team with less than five years’ experience.
Here, Mariana Villanueva, ESG analyst at AXA Investment Managers, explains her thoughts on how the anti-ESG backlash was a sign of the market maturing, her involvement with joint shareholder resolutions and how there’s “no stronger message” than good stewardship and engagement.
How did you start your career and what led you to focus on ESG/sustainability? Is this a personal passion?
I’ve always had a passion and interest in environmental and social issues, probably influenced by growing up in the Philippines where these challenges are rife and difficult to ignore. That led me to specialise in impact-driven companies in business school to gain a broader perspective. I initially launched my career in Paris, in socio-economic policy after completing my studies in development economics and policy. It was only later that I delved into the realm of investment gaining a deeper understanding of the influential role that financial actors can play.
You joined the industry around five years ago, when appetite and launches in this area of investment soared. What was that like to experience as a relatively new starter to the industry?
As a newcomer with a strong interest in ESG, the general mood towards ESG topics was very encouraging and sent positive signals about the direction of the industry where I aimed to build my career. I left a sustainability focused team for a mainstream investment function where I was pleasantly surprised to have ESG systematically brought up in every discussion – from investment committees to issuer roadshows. It felt like a paradigm shift was occurring wherein ESG had ventured out of the corporate social responsibility and philanthropy space and was being considered by everyday investment professionals.
And what has it been like for you over the past few years where appetite has waned, and we have experienced the anti-ESG backlash in some areas?
Like many topics, I believe that challenging periods are when core convictions are revealed and reaffirmed – ESG is one of them. I’m lucky to work for an asset manager that has stood firm on its convictions which I personally share. I think we are seeing dialogues shift slightly now, to an emphasis on better communicating and demonstrating the value of integrating ESG into investment decision-making and processes; and proving there is a solid ESG approach. I like to think that the anti-ESG backlash is also part of the market maturing on sustainability more broadly and that it has given way to healthy discussion and debate.
What has been a career highlight for you?
Stewardship activities have been particularly rewarding! Stewardship and engagement used to be rather vague concepts to me, whose outcomes weren’t well understood. I realise now that I had greatly underestimated the value of these activities, which are essential for implementing impact strategies. I’ve been involved in many collaborative engagements, some of which have achieved tangible outcomes through joint shareholder resolutions, for example, and others that are contributing to shifting industry dialogue and raising awareness such as Nature Action 100 and Investor Initiative on Hazardous Chemicals. It’s always rewarding to be a part of something bigger than oneself.
What is a red flag for you in terms of greenwashing? Are you happy to hold companies or individuals accountable for greenwashing?
A general lack of transparency over any green claims. There are differing perceptions of greenness, but what matters is that green claims are effectively backed up and well described so that market participants can evaluate these claims for themselves. I’m also increasingly paying attention to consistency. While it’s laudable for a company to have positive or off-setting actions, I believe that companies should also strive to mitigate their on-going negative impacts first and foremost.
While I may not fully endorse the concept of naming and shaming, I do believe in holding companies accountable. There is no stronger message than stewardship and engagement, and allocating capital to issuers that align with or are striving to align with an investors’ sustainability convictions.
Fast forward to five years from now – where would you like to be in terms of career aspirations? And how do you think the industry will have evolved by then?
I’d like to be at the heart of sustainable financing, working in an impact strategy role as close as possible to funding projects which are directly contributing to the broader social and environmental transition – and preferably with an emerging markets dimension. As to what kind of role, careers can surprise you, so I’d like to leave room for unexpected opportunities!
If the sustainability push is successful, I expect that the majority of investment professionals will be well-versed and eager to adopt and incorporate sustainability topics. There will always be a need for experts and subject specialists, but I hope by that time ESG and sustainability will become fully integrated.
