One of the UK’s top investors says impact investing is nothing new for investors like family offices, although the scale of it today is much bigger than it has ever been.
Jon Moulton, a leading venture capital and private equity specialist who founded a number of private capital-led funds, believes investors need to see impact/sustainable investing in a historical sense and that it isn’t new, despite the perception in many quarters that it is a very recent concept.
“My grandfather had a portfolio where the sole selection criteria of his investments needed to be based in Stoke-on-Trent, which is where he came from,” said Moulton. “That’s impact investing.”
He added: “Nearly 50 years ago I worked on a portfolio owned by the Lever family, as in the family behind Unilever, and they were investing in companies on social grounds.”
The screening of portfolios on sustainable/social grounds goes back many years, said Moulton. “Family offices have always expressed some level of preference to impact investment themes, like saying they don’t want to do tobacco, or they don’t want to do oil, or they don’t like to invest in defence.”
Moulton was speaking at a sustainable finance conference held by Guernsey Finance in early June.
But Moulton said impact investing has really taken off in recent years. “It’s just much bigger now, and a much bigger issue.”
Moulton was speaking on a panel on sustainable/impact investing and private capital, which included David Bain of Family Capital and Taeun Kwon, head of wealth management programs at the Center for Sustainable Finance and Private Wealth at the University of Zurich. The session was chaired by Andy Sloan, deputy chief executive of Guernsey Finance.
Kwon said wealth management groups often pitch their sustainable funds and products at a level that can confuse wealthy clients and they might not offer clients the best results. “Private banks might not be the best place to see quick results in impact investing, so wealthy clients often look elsewhere.”
Guernsey is setting itself up as a centre of excellence for sustainable finance initiatives and works with a number of family offices in this respect, including Moulton’s various investment groups. Moulton is based in Guernsey.
“The Guernsey pitch is that we bring together a distinguished pedigree as a location for family offices and servicing private wealth together with a jurisdiction-wide commitment to sustainable finance,” said Sloan.
“We’re members of several United Nations networks and have developed world-leading sustainable products and services in the private capital space with a fiduciary and advisory community developing expertise in this field.”