15:00, 12 feb 2021

Public awareness, the role of businesses and ESG investments: The COVID-19 pandemic gives sustainable issues a boost

"Development" must also mean "sustainable development". Public awareness, the role of companies and ESG investments. We talked about this topic at the WM Forum

Mario Romano
Direttore investimenti Sella Sgr
Alessandro Marchesin, CEO of Sella SGR, at the Sella Wealth Management Forum
Alessandro Marchesin, CEO of Sella SGR, at the Sella Wealth Management Forum

The issues of environmental, social and governance sustainability, in recent years, have become incontrovertibly one of the most important macro trends in the financial industry. The COVID-19 pandemic has also been an extraordinary lever fostering a great acceleration of sustainability issues. The two main trends underway are, on one side, an increase in public awareness, and on the other, the European legislator encouraging the ecological conversion of companies. In recent months, plans have been launched throughout the planet to allocate large sums to green modernization.

Sustainability and productivity were also among the topics addressed during the first digital edition of the Sella Wealth Management Forum 2021, the event reserved for private bankers of Banca Patrimoni Sella & C. and Banca Sella.

In particular, Alessandro Marchesin, CEO of Sella SGR, discussed this in an interesting debate with Mario Tozzi, Senior CNR researcher and scientific divulger, during which he ranged from the role of man as a cause of climate changes to responsibilities of individuals and companies, up to virtuous conduct and financial solutions in the ESG.

During the meeting, the two speakers addressed the best behaviours to adopt as individuals and as a financial and economic community to go in the right direction. Professor Tozzi stressed that the first fundamental target to achieve is the awareness that the natural capital on earth is fixed and cannot be increased: preserving the integrity of the natural capital is imperative to economize.

The element of understanding is vital because as there are only two alternatives: understanding this behaviour and anticipating it through intelligence or submitting to it through trauma. There can be no economy if the biosphere is not healthy.

Today it is possible to make a difference at three levels: individual, business, and legislative. First, every citizen must understand they can do something for the environment. For example, by limiting the intake of foods that have extensively travelled or come from factory farms. Or it is possible to halve the carbon dioxide levels produced annually by cutting on combustion cars and giving up intercontinental travel. Furthermore, the "positive word of mouth effect" should not be underestimated, as it allows us to influence those around us, urging them to adopt the same honest and positive behaviours.

At a business level, companies producing goods can make ecological reconversions appealing from both a social and economic perspective. For example, a product rewarded for its eco-friendly transformation urges the business perspective of its producer to change completely. At this point citizens and businesses, together, can ask administrations and the legislator to help them by encouraging reconversion.

Another point of speculation started from the statement  that "Natural disasters do not exist. They do not in themselves cause lethal effects to people if not in function of human action, i.e. the "sapiens".

We wondered why the association between man, climate change and the pandemic is not made. In Mario Tozzi's opinion, there are several reasons. First of all, humans don't like feeling accused of committing unhealthy behaviours (sapiens prefer believing that the pandemic originated from a laboratory-created virus, rather than deforestation). This is a very common and typical mechanism for guilt removal.

The latest pandemic case is very interesting. COVID-19 is a very tiny RNA virus that is scaring 7.5 billion humans. This is because the virus' strategy is exactly like ours: it tries to reproduce itself as many times as possible.

According to some scientific studies, the virus originated from two animals: the bat and the Malayan pangolin. Bats are animals that, having lived on this planet for millions of years, have a large viral load. For this reason, they have developed a very strong immune system, which allows them not to be harmed by viruses. Due to deforestation and the destruction of a part of their habitat, these animals are forced to move to new places where urban settlements or industrial areas are present. In this way, the saliva of bats containing the viral load is conveyed to other animals until it reaches the sapiens which does not have the same immune response and suffers much more.

A natural event that man transformed into a catastrophe, as it happens with landslides and floods. Man is ultimately responsible. If the man had left the forests intact, the spread of the disease would have remained confined. In future, we must learn to increase our respect towards nature and the forests to significantly limit the spread of viruses. To conclude, the focus is now on the world of Asset Management, which can make an important contribution to change. 

For some years now, companies such as Sella SGR have begun to convey an increasingly significant share of investments towards virtuous activities. The challenge for the future is to invest in sustainable realities increasingly attractive for savers, who are starting or have already started the process of ecological conversion to create a better world in the medium to long term. This can lead to a competitive advantage for companies which translates into an economic advantage for the investor, leading to a benefit for the community and generating a virtuous circle of collaboration for the common good.

"The attention we have had concerning the ESG acronym in recent years, commented Marchesin, focusing on the letter E for Environment and S for Social, is a starting point. But willing to rewind the tape we discover that the most important letter is G for Governance: it is how people working in the companies behave that makes the difference ".