This September, White Marble joined forces with tml Partners to bring together senior marketers in investment management for an ESG breakfast roundtable event that focused on the importance of culture in building authentic sustainability credentials.
We were interested in the characteristics that made true leaders in sustainability stand out from the crowd. As features such as TCFD reporting, UK Stewardship Code adherence and the integration of diversity and inclusion policies become the industry standard, the one differentiating factor still available to brands is culture. We have observed that many of the brands recognised in the industry as being leaders in sustainability are also those with a reputation for a robust, clearly-articulated culture.
All roads lead to culture
Strong and accessible corporate culture is a key tool for addressing some of the key challenges facing our industry.
Evolving landscape – The landscape of investor and regulatory requirements is evolving rapidly and firms frequently find themselves needing to be reactionary and pivot to meet new regulations and satisfy investor demand. Culture is key to not losing a sense of identity in this environment and maintaining consistency against this background of change.
Talent acquisition and retention – ‘Our assets are our people’ is one of the most frequently evoked sentiments in our industry. Given the importance of intellectual property and the human assets behind it, talent acquisition and retention is key. Culture plays a key role in this, especially as a new generation that values work-life balance, community, the environment and social issues enters the workforce.
Reputation – Both growing a positive reputation and protecting against reputational damage are the ongoing responsibility of brand teams. This relates to the acquisition and retention of talent, as well as the reputation of both the business and larger asset management industry among prospective clients. Retail and institutional investors alike may be dissuaded from investing their money in a firm that attracts negative press, or that has a reputation for high rates of staff turnover.
Green- and social- washing – Protecting against both actual and perceived green- and social-washing has both data and cultural factors. Training and corporate culture are key to overcoming challenges such as hierarchical pressure forcing errors and coverups that subsequently emerge and cause harm.
Social Washing – Exaggerating social credentials or trying to exploit social sensitivities to sell products. For example, a business might claim to promote diverse hiring in order to build their reputation in the industry, while not making a serious effort to transform their hiring practises.
Innovation and evolution – Another two of our industry’s favourite catchphrases. Without a culture that encourages the free exchange of ideas and the notion that new concepts should be rewarded, innovation cannot thrive.
CSR, CSI and Corporate Purpose – Corporate culture, what matters to the people in a business, informs CSR, CSI and corporate purpose. These are areas that are drawing increasing attention and scrutiny from retail and institutional investors alike, and there is a growing need to evidence authenticity and purpose. A random spattering of philanthropic activities with no unifying theme is no longer enough. This has importance for some (admittedly not all) investors, and many prospective employees (especially Millenials and Gen Zi).
Short-term market conditions – Focusing on current market conditions is inherently short-term. While firms must have some tactical capacity and reflect investor needs, they cannot disregard longer-term goals or training schemes.
Cognitive diversity – Another term that’s a favourite of our industry. Cognitive diversity moves beyond diversity in terms of gender and racial inclusion to focus on establishing a cognitively diverse workforce. A culture of equity and inclusion is essential to reap the benefits of cognitive diversity.
To read the full report and discussion summary, CLICK HERE.