If you want to save the world, your first choice of profession historically was probably not the financial services sector. Doing good deeds while selecting companies to invest in based on straight profitability doesn't exactly accord with moral prerogatives. This is why, for the most part finance has long appealed to amoral, intellectually curious, materially motivated individuals with very good exam grades.
This is changing. As yesterday's Goldman Sachs survey of opinions among its 2019 summer interns revealed, banking juniors (at GS at least) are environmentally aware and keen for carbon taxes to mitigate the effects of climate change. This accords with just about every survey of Gen Z and Millennial opinions ever done. It could become a problem for finance firms trying to hire people under the old amoral ethos - but that ethos is changing.
A report today from Deutsche Bank sugests that in the next decade jobs for people involved in ESH (environmental, social, and governance) investing will go through the roof. Right now, ESG investing accounts for 30% of the total global assets under management (AUM), says Deutsche. However, in ten years, ESG will account for 95% of AUM under the current growth trajectory. By 2029, most people on the buy-side will be investing with morality in mind. The amoral elite will disappear and finance will fill with people who want to make a difference.
Deutsche says the change is happening already. It notes that Norges Bank Investment Management (NBIM), Norway’s $1tn sovereign wealth fund, has introduced limits on coal exposure. Last year, NBIM blacklisted Rio Tinto, the Anglo-Australian miner which owned a copper mine in Indonesia that was seen as an environmental risk. After Rio sold the mine last year, NBIM reinstated the company’s stock as ‘investible’.
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