"Around 30 Percent of Global Assets Are Sustainably Managed"
Béatrice Fischer, Head of Communications & Marketing at the Swiss Universal Bank, is also responsible for the bank's offering in the Philanthropy & Sustainable Investments area for our clients. She believes there is considerable potential in the sustainability segment.
Ursula Nötzli Breinlinger: The topic of sustainability is very much in vogue. What should investors understand by the term "sustainable investing"?
Béatrice Fischer: The aim of sustainable investing is to combine financial returns with positive repercussions for the environment and society. The investor strives to build up a comprehensive view that also includes non-financial factors. In investment decisions, the investor also takes into account sustainability aspects, i.e. social factors, the corporate governance of the companies in question, and environmental aspects – also known as the ESG criteria: Environmental, Social, Governance.
How popular is sustainable investing in Switzerland?
Viewed in global terms, around 30 percent of professionally managed assets are now managed on a sustainable basis, and the rising trend is very pronounced. In Switzerland the market volume of such assets is still relatively low and currently amounts to around 192 billion Swiss francs. However, the growth rate is remarkable.
How is Credit Suisse positioned in this market?
We have been active in the area of sustainable investing for around 15 years. Credit Suisse now has a market share of just under 12 percent in Switzerland, which makes us the second biggest player in this market. An important step in the development of our sustainability offering was the co-founding of responsability. Responsbility is currently the leading provider of "impact investments" and remains an important partner for us.
We have been active in the area of sustainable investing for around 15 years.
Are there specific client groups that are particularly interested in this topic?
We are witnessing a significant rise in interest in all client groups, both in the private client and institutional client areas. We see considerable potential for the sustainability theme among socially and environmentally aware client groups such as millennials, female investors, and entrepreneurs. The latter are often confronted with sustainability issues in the management of their companies and are developing a corresponding interest in this area. On top of this you have to factor in the 13,000 charitable foundations in Switzerland. They have been obliged by Swiss Foundation Code to align their investments with the specific foundation purpose as well as with sustainability criteria since 2015. Pension funds are also increasingly confronted with a desire on the part of their insured members to invest their retirement assets sustainably. On the basis of the sheer volume of assets under management, this market offers interesting opportunities.
How does Credit Suisse engage with the topic of sustainable investments to give these client groups the most extensive possible offering? How does Credit Suisse make sure to provide these client groups with the most extensive offering?
We offer our clients both sustainable portfolio solutions and sustainable individual products. Two of our flagship sub-areas are Impact Investments and Sustainable Real Estate. Impact Investments focuses on sectors such as microfinance, socially-oriented companies, sustainable agriculture and fair trade, as well as higher education in emerging and developing countries. The Sustainable Real Estate area offers innovative products that invest in climate-neutral properties in both Switzerland and Europe. The potential for sustainable properties is huge, as real estate is responsible for 30 percent of all global CO2 emissions.
Credit Suisse was the first company in Switzerland to operate on a climate-neutral basis, and the bank has operated on a climate-neutral basis globally since 2010.
Credit Suisse is also committed to sustainable development through a number of different initiatives. How do you leverage this expertise and experience for clients when it comes to developing products and solutions?
Microfinance, education, and environmental protection are themes that we make a significant commitment to as a company. Credit Suisse was the first company in Switzerland to operate on a climate-neutral basis, and the bank has operated on a climate-neutral basis globally since 2010. In collaboration with Siemens and Wincasa, we are reducing our CO2 emissions in almost all our 1200 properties. We use the experience gained through this process for product development: We have launched the first sustainable real estate fund in Switzerland and the first climate-neutral real estate fund in Europe. Credit Suisse also plays a pioneering role in the area of environmental protection financing. We work together with NGOs and foundations to develop innovative products in this area. Obviously this also means involving our employees and giving them opportunities to volunteer on sustainability projects.
In the world of finance, the word "sustainable" still conjures up an image of something that is expensive and performs poorly. How would you respond to that?
Credit Suisse would argue that sustainable investments do not suffer from structural underperformance. A number of studies have shown that ESG criteria have a positive impact on risk/return profiles. Incorporating impact investments or real estate building blocks into a portfolio increases diversification, as these instruments have little or no correlation with the traditional financial market. Last but not least, the motivation to invest sustainably is important in itself: Some investors want their portfolios to reflect their personal values. Additionally, institutional clients in particular deliberately use the non-material criteria I mentioned to reduce risks, as these can often have significant financial repercussions.