Where theory and practice meet: Sustaining and impactful, and especially for governance fiduciaries.
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Marquette was delighted to host executives and corporate leaders from companies and investment firms from across the country on October 24 at its annual Sustainability 2.0 Conference.
The event garnered its largest attendance ever.
Experts from around the world came together to discuss the challenges and opportunities facing organizations for a sustainable economy, now and in the future.
The Marquette University Sustainability Lab is a cross-disciplinary project that aims to research and disseminate knowledge, foster and develop managers around effective sustainability and stewardship practices increasingly demanded across industries globally. Our lab aligns with the university’s commitment to the Laudato Si’ papal encyclical and furthers our Catholic, Jesuit mission to care for our common home. Through instructional opportunities that span business, the STEM fields, the humanities and more, the Sustainability Lab provides students with the knowledge they need to Be the Difference.
Housed in finance and the college of business, the S-Lab is interdisciplinary across the university including the Office of Economic Partnerships, supply chain management, communications, engineering, the natural sciences, the Women’s Leadership Institute, the law school and the Center for Peacemaking.
Its purpose: to research, educate and bring together this generation of sustainability leaders.
Marquette has long been recognized as a leader in sustainability. The university hosts the “Sustainability 2.0” Conference every fall, bringing together business leaders and executives from investment firms, public and private companies and NGOs for the largest regional conference on the issue. Our ESG (environmental, social and governance) courses are, likewise, unique among Midwest universities, designed with the future of corporate behavior in mind. Finally, the university itself is a recipient of the Princeton Review’s “Green College” designation and is recognized as one of the country’s most sustainable campuses.
Co-director, Dr. Christopher K. Merker, had this to say on the Lab and the critical importance of sustainability on present and future business performance: “Our goal is to help people understand and adapt to the world that’s changed around them. Those who undertake this successfully will be prepared to handle the strategic issues around sustainability, whether as an investor or as a business manager.”
2022 is wrapping up on many levels as the most challenging year financially since the Global Financial Crisis, geo-politically since 9/11, and politically since the McCarthy years, when the country was divided over fears of a fifth-column, communist invasion.
One casualty in this bubbling cauldron of uncertainty has been what has become known in the past few years as ESG investing. 2022 marked the first year of negative outflows in over a decade with investors pulling $13.2 billion out of ESG funds through November 2022, according to Lipper. Even when considering the broader universe of fund outflows this year, ESG outperformed and not in a good way.
(https://www.reuters.com/business/sustainable-business/esg-funds-set-first-annual-outflows-decade-after-bruising-year-2022-12-19/)
The secular headwinds are obvious at this stage: in Europe the Ukraine War and the implosion of its energy market. In the U.S., rampant inflation. In the emerging markets, the insidious and growing activism of authoritarian regimes on the world stage, namely China, Russia, Iran and North Korea.
Certain factions in the United States have seized on this backdrop of uncertainty and placed a portion of the blame on the ESG movement, characterizing it as woke, damaging to the middle class and harmful to the economy.
Exhibit A: Blackrock has seen over $2 trillion in assets flow out, particularly from a wave of public pensions that have fallen under state legislation banning ESG investments.
Exhibit B: Vanguard announced recently its intention to back away from the NetZero Alliance to address “confusion” over its ESG positions as a leading indexer.
While a political backlash in the U.S. seems to be the norm these days on just about any issue, this has marked a sea-change in the ESG movement, just as the SEC pursues stronger mandates to enforce greenwashing claims.
This has no doubt made for a tougher business environment for ESG investing.
All that being said, beneath the subterfuge is real underlying progress developing, and it is happening in the places that matter most: companies. A confluence of rationalization happening at the ESG standards level, in the form of the International Sustainability Standards Board, combined with pending rules on SEC climate-related financial disclosure has lit a fire, and companies are not backing away.
Data science is leading the way, and companies that are measuring are finding that they can also manage. Capital markets will remain part of the equation, providing some additional carrots and sticks, but the real traction will only happen with companies that find ways to innovate ourselves into a new carbon pathway, as one example.
This is also I think bringing some new life to the whole rationale where I think ESG as an investing experience has found itself marooned. For too long investment managers have fallen back on this idea that ESG is a risk management exercise. This may be true, and certainly can be argued, but it only carries us so far. People wanting to do the right thing and have a passion for doing the right thing, is where the whole idea of good corporate citizenship started. ESG investing has failed with investors who thought this concept could be simply rationalized and outsourced. As we are finding out, doing sustainability is a roll up the sleeves activity that is best placed when as an integral part of doing business.
| ESG Courses at Marquette University are available for professionals to attend today! New environmental, social, and governance (ESG) courses to serve as preparatory courses for industry-driven certifications for accounting, investment professionals and ESG leaders, offered to professional learners in an asynchronous format, with one course on a hybrid online/live platform. The timeliness of these offerings coincides with the new SEC Climate Disclosure rules. In the U.S., not just public companies will be subject to the SEC requirements; “Scope 2 and 3” reporting will impact thousands of private companies, too, who contribute as suppliers and partners to these companies. Corporations are in a unique position today to elevate ESG practices in partnership with Marquette University. Prepare your organization today for the ESG requirements of tomorrow! Vouchers are included for participants to access the Fundamentals of Sustainability Accounting (FSA) Credential™ (FSA I, FSA II teaching to the SASB Standards) by the IFRS Foundation, and the Certificate in ESG Investing by the CFA Institute. |
We are delighted to announce our keynote speakers for the 2022 Marquette Sustainability 2.0 Conference scheduled for October 26-27. We look forward to a special keynote panel discussion on the energy transition and the potential future of nuclear power with leaders from two outstanding organizations.
For further details on the conference:
https://www.marquette.edu/business/companies/sustainability.php
Mr. Dan Pickering, Founder and CIO, Pickering Energy Partners
Dan Pickering is the Chief Investment Officer of Pickering Energy Partners (PEP). PEP manages client assets via energy strategies focused primarily on public markets and private equity. Prior to PEP, Mr. Pickering served as the President of Tudor, Pickering, Holt & Co. and Chief Investment Officer of TPH Investment Management. Dan has spent 26 years as an energy portfolio manager, researcher and analyst, first at Fidelity Investments (where he managed ~$1 billion of energy sector funds), then as Head of Research at Simmons & Company and as the founding partner of Tudor, Pickering, Holt & Co. Dan currently serves as the portfolio manager of the PEP Energy Equity Opportunities Fund and on the Investment Committee of PEP’s energy co-investment and private equity strategies. He also serves on the Advisory Board’s for Tudor, Pickering, Holt & Co, the Energy ESG Council, the Houston CFA Society, as well as the Board of Trustees for Texas Children’s Hospital and the Texas Children’s Hospital Foundation. Dan grew up in Missouri, has a BS in Petroleum Engineering from the Missouri School of Science and Technology and an MBA from the University of Chicago.
Mr. Brent Ridge, President and CEO, Dairyland Power Cooperative
Prior to Dairyland, Ridge served as Vice President, Corporate Services, and Chief Financial Officer and Treasurer at Energy Northwest (Richland, Wash.). His responsibilities included finance, treasury, enterprise risk management, asset management, human resources, supply chain, information services and energy services and development. He also served as Vice Chairman of the Corporate Nuclear Safety Review Board for Columbia Generating Station. Earlier in his career at Energy Northwest, Ridge served as Asset Manager, Controller and Chief Risk Officer. He was also the manager of Construction and Maintenance Services, responsible for power plant modifications, outage and online major maintenance, facilities and commercial engineering. Ridge earned a bachelor’s degree in Civil Engineering from the University of Idaho and an MBA from Regis University (Denver, Colo.). He also completed the Reactor Technology Course for Utility Executives at MIT, the Utility Executive Course at the University of Idaho and the Advanced Management Program at Harvard University.
We look forward to seeing you in October!
Link to article:
To pre-register for the program:
https://www.marquette.edu/business/executive-education/esg-sustainable-finance.php
In this interview with Marquette Today, I attempt to define ESG.
The Financial Economist Roundtable weighs in on the SEC’s proposed climate-related disclosure rules. Their advice: limit rules to ESG related-cash flows and avoid “proxy legislation” of social and environmental policy.
https://www.tandfonline.com/doi/full/10.1080/0015198X.2022.2044718
The Financial Economist Roundtable (FER) is a group of senior financial economists who have made significant contributions to the finance literature and seek to apply their knowledge to current policy debates. FER was founded in 1993 and meets annually. Members attending an FER meeting discuss specific policy issues on which the FER may adopt statements. When the FER issues a statement, it reflects a consensus among at least two-thirds of the attending members, and all the members who sign it support it. The list of signatories for the 2021 statement can be found at http://www.financialeconomistsroundtable.com/.
Interesting take in this essay on what ESG is and isn’t in the current context of the Russian invasion of Ukraine from Robert Eccles.