"ESG helps build a better portfolio“
„Sustainability only works when it is understood economically“, says Daniel Sailer, who heads the Sustainable Investment Office at Metzler Asset Management. For over ten years, he has been driving the integration of ESG (Environmental, Social, Governance) criteria into investment strategies.
The 41-year-old began his career with a work and study programme at the Duale Hochschule Baden-Württemberg and LBBW. After three years, he moved to MSCI, the world's leading provider of ESG data. There, he built the ESG Research Sales Team, and supported Scandinavian banks and pension funds that were early adopters of ESG indices.
Sailer's initial scepticism towards sustainability quickly faded as he realized that ESG investments do not necessarily reduce returns. In 2016, he joined Metzler Asset Management. He considers Metzler to be one of the first German firms to systematically integrate ESG criteria across all publicly available funds. And he believes that transparent ESG reporting is essential for implementation, as it allows investors to see how sustainability ratings, and any potential controversies, are evolving within their portfolios.
„ESG helps build a better portfolio“, states Sailer. The integration of ESG is driven not just by ethical reasons, but primarily by economic considerations. Sustainability must support a company's economic success in order to work in the long term.
It is critical to support companies that are on the right track, but have yet to achieve the highest ESG standards, he believes. Sailer cites the chemical industry as an example: in this sector, investments in sustainable biochemicals are heavily influenced by energy costs. Stable energy prices could help secure these future investments, and prevent industrial relocation.
A livable future
Sailer is convinced that sustainable investments are no longer just a trend. „Sustainability will continue to shape the financial industry“, he says. „We have a responsibility for the future. Sustainability and profitability must go hand in hand.“
As a father of two, he is also aware of the importance of sustainable financial decisions on a personal level. He wants his children to grow up in a liveable world. Sailer views the European financial sector as being on a promising green path. But he calls for clear and uniform regulations, particularly in emissions trading and the EU taxonomy, to facilitate the transition to a climate-neutral economy by 2050.
He also desires greater harmonisation of global ESG regulations, to provide clarity for companies and investors, saying that "standardisation in the area of ESG through regulation helps the market grow, and provides investors with guidance.“
Headwinds in the US
Sailer is concerned about the headwinds in the United States. „If you do business in the US, you have to remove sustainability from your marketing materials," he explains. "Otherwise, due to political developments in some states, you can no longer serve your customers.“
The situation looks better in Europe. The EU's proposed Green Deal Industrial Plan could help promote sustainable innovation in Europe, and ensure that the old continent is not just a „playing field“ for transformation but actively takes a leadership role. In Germany, up to now the ESG train has not come off the rails. The situation here is different from that in the US.
