It is about recognising dual materiality, understanding where we can invest to make the world a better place and where risks may impact our bottom line.
Lloyd, what conversations are you having with institutional investors who are pursuing responsible strategies? Lloyd McAllister: There has been a huge uptick in investors try- ing to understand what we mean by responsible investment. The industry is being rightly challenged to tighten the defini- tions of what people are talking about.
Definitions can be quite a dry conversation, but they are impor- tant because they define outcomes.
Ensuring clients are clear about whether they are in an exclu- sion, ESG integration or sustainable strategy is a key starting point. That has been partly driven by Sustainable Finance Dis- closure Regulation (SFDR), so definitions are a big piece of the conversation.
Then there is being able to demonstrate that you are doing what you say you are through stock and engagement examples to bring all of the talk to life. So rather than having 15 pages of process and two pages on ESG performance, we are switching that around and saying this is what we do and here are the statements to back it up. That is the big change we have seen this year. Campbell: Process is important in being able to evidence that you are doing it. Lots of people talk a good game on this. We have attended meetings with companies to discuss ESG and management have said we are the first professional inves- tors to mention this. If everybody was walking the walk here, we would not be the first people to talk to them about it.
Are pension scheme trustees concerned about the cost-of-living crisis and, if so, is it part of what they are trying to achieve? Claire Jones: Yes and no. Many pension scheme trustees are focused on the impact on their liabilities. They are thinking
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