2024-04-19: Nature

If you haven’t already you should read the book in the cover. Written by a well-known Italian climber, explorer, journalist and writer it is an eye-opener and well worth the time. It was published in 2009, just when we were all concerned about financial meltdowns and other much less charming humanly-caused events. The descriptions of Bonatti’s adventurous expeditions in some of the most naturally pure, beautiful and inaccessible places on earth is mesmerizing and borders on the incredible (‘alternatively realistic’ some people could say). His capacity to survive under practically any circumstances and for the most part on his own makes you realize how squeamish and pampered we have become, and how far from the nature of the world we have moved.

Somewhat coincidentally (I just finished Bonatti’s book), for the past few weeks I’ve been dwelling with some of our investing partners on the question of how to run a more ESG-aware portfolio. While the subject is much talked about and on itself would appear very logical, it is by no means well structured and organized in its application to a real-life situation. Part of the problem is that there are more than one set of rules or standards to be followed; it almost feels as if there are as many definitions or models as there are investment managers. There is also a lot of confusion in the terminology used: half of the people I talk to can’t tell the difference between ‘ESG investing’ and ‘impact investing,’ for example. Finally once the question of exposure and sectors are considered there is yet no agreement on how ‘severe’ the standards need to be (for example, like in the case of ‘best-in-class’ versus ‘exclusion’, both approaches widely employed in investment vehicles). At best, the field is work-in-progress, though legislation (in Europe) is moving fast and furious.

Makes you wonder if it would be easier to tag along a Bonatti-like adventure than trying to take on the task of implementing an ESG mandate.

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The reverberations from last week’s monetary policy expectations change continued this week with more determined impact on equities, aided also by the strong retail sales figure in the US. On the economic front, China grew more than expected while the IMF estimates the world will grow by 3.2% in 2024, a number once considered quite weak.

[Image Sources: Amazon.it, https://www.amazon.it/mondo-perduto-Viaggio-ritroso-tempo/dp/8866200611]