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19 February 2022 THEWEEKCommentators
Thetotalvalueof“green”ESGfunds could hit$50trnby
2025,accordingto Bloomberg.Mostinvestorsbuyingintothem
believethey’redoingtheir bitto tackleclimatechange,saysThe
Economist.Butthat“goodfaith”maybe misplaced.Fundsoften
meettheirgoals“simply byexcludingthesharesoffirmsin
pollutingindustries”,andthisishavingunintendedsideeffects.
“TheWestern world’sdirtyassets areheadingintotheshadows”,
aslarge,publicly-listed energyandminingfirmsselltheirmost
polluting(andoftenhighlyprofitable)assetstoplease ESG
investors.Privateequity firms,outofthelimelight, havesnapped
up$60bnworth offossil-fuel-linkedassets inthepasttwoyears.
Theprocessstinks.“Sellingapollutingassetdoesnotin itself
reduceemissions”,andoncein privatehandsthepressureto do
so fades.Thebestway totacklethisissueis“toaligntheprofit
motivewiththe imperative to cutemissions”viacarbontaxes. In
theshortterm,“sinceregreeninvestors”woulddobettertohold
onto “dirty shares”andworkwithmanagers to reduceemissions.Officeliferemains“ashadowofitsformerself”,saysLucy
Burton,and“rampant inflationwillsoonaddafurthertwist”.
Longleasesonsemi-emptyofficesareobviousthingsto put“on
thechoppingblock”forcompanies seekingtocutcosts–andto
financepay rises.Givenatight labourmarketandcontractingreal
wages(which fell by0.8%inrealtermslast quarter),thepressure
to coughupismounting.“Workers want paybumps...andamid
afiercebattlefor talenttheymaywellgetthem.”These
“negotiationsover payrises”are alsolikely tobe “lessheatedif
stafffeeltheir work-lifebalancehasat leastimproved andthey
cansavemoneyoncommuting”–anothertrendwhichislikely
to embedhybridworking.Allthislookslikebad newsfor
commerciallandlords.Althoughactivityhaspickedupinrecent
months,asurvey bycommercialrealestateagencyInfinitSpace
foundthat 62%of the204UKofficelandlordscanvassedwere
“strugglingto attractprospectivetenants”.Ultimately,themarket
willshifttoaccommodatenewwaysofworking.Butrightnow,
landlordsare “caughtin thecrossfireinthebattle over pay”.Economicstatistics will“neverfullycapture”the sacrificesmade
byyoungpeople duringthepandemic,saystheFT.Theylost
“yearsof carefreeyouththey willnotgetback”,largelytoprotect
those fromoldergenerations.Nowthey faceanewfinancial
blow.TheGovernmentisfreezingtheincomelevelatwhich
it becomescompulsorytostartrepayingtheir studentloans.
“Inflationwillthereforedrawmany,notvery well-paid,graduates
intorepayment–equivalentto anincrease inincometaxof
around 9 %ayear.”Indeed,the Intergenerational Foundation
estimatesthatthecombinationof “stealthtaxes”,thescheduled
NIhikeandinflationmeans“the disposableincomeofatypical
27-year-oldgraduatewillfallbyclose to 3 0%overfouryears”.
Meanwhile, problemspredatingthepandemic –notablyrising
houseprices–haveonlyintensified.“Responsessuchas takinga
riskypuntoncryptocurrencyor choosingnot tohave childrenare
understandable reactions,buttheyrepresentafailure ofadecade
of governmentpolicy.”TheGovernmentneeds aNewDealfor
theYoung–who“cannotkeepbeingasked tofootthebill”.“Inaright-thinking,butwrong-headeddecision”, whichmight
havebeenparodiedonthe comedyshowW1A,the BBCis
movingthe entirebusinessreportingteamforRadio4’sToday
andtheWorld Serviceto Salford,says Oliver Shah. “Manchester
is agreat city”,butLondon“will alwaysbe thecentreofbig
businessandfinance”,andthis move means mostchiefexecutives
will“nolonger be abletodropintogiveface-to-faceinterviews
onbusy results days”.What’smore, thenewunit–renamed
“moneyandwork”–seemsto have “a keyword”missing.
There’slong been asuspicionthattheBBCdoesn’tmuchlike
business,or wanttounderstandit,viewing it as “dirty”.Perhaps
that’sareflectionof Britishsociety at large,butitmakesAuntie
“herownworst enemy”.The BBC’sattitudeto businessis both
asymptomandacauseofits troubleswiththeGovernment–it
“windsuphawks”whowantto cutthelicencefee.“Forreasons
of self-preservation,letalone thebloodpressureoflistenerswho
careaboutfreeenterprise”,managementneedsto rethink.ChitraRamkrishna
The formerchiefof India’s
NationalStockExchangehas
receivedahefty fine,and a
ban fromworkinginfinancial
markets,afteradmittingthat
whilerunningit she reliedon
advicefromaspiritualyogi
basedin the Himalayas,said
The DailyBeast.Chitra
Ramkrishna,whoquither
job in 2016,saidshe thought
the guidance“wouldhelp
me performmy rolebetter”.
But an investigationhas
concludedthatshe was
“merelyapuppet”in the
unnamedguru’shands.
The huntis nowon to track
downthe mysteryyogi,said
PalakShahon The Hindu
BusinessLine.It seemsto
be someonewho“knew
the insideworkingof the
exchangeclosely”and
was“verywellnetworked
in Delhi’spoliticaland
bureaucraticcircles”.Rather
oddfor aHimalayan hermit...JoWhitfieldIn an apparentfirst,the CEO
of the Co-op’sfoodbusiness
is takingafour-month
unpaid“careerbreak”to
helpher two sonsprepare
for theirexams,saidAshley
Armstrongin The Times.The
juniorWhitfieldsare sitting
GCSEsand A-levelsthis
yearand theirmother–a
Liverpudlianwhodescribes
herselfas “familyfirst”–
wantsto see themthrough
“theinevitablepressureand
emotionalturmoil”.Group
CEOSteveMurrellswill take
responsibilityfor Co-op’s
2,600shopswhenher leave
beginsin May.The move
has drawna“mixed
reaction”,saidBBC
Business.Somepraised
Whitfield,whoearned£1.4m
in 2020,as “a fantasticrole
model”.Otherspointout
thatwhilesuchabreakis
opento all Co-opstaff,most
couldn’taffordit. “Equality
of opportunityas tokenism?”
tweetedone critic.Aroughdeal
foryoung
people
Editorial
FinancialTimes
Thebattlefor
pay–andits
casualties
LucyBurton
TheDailyTelegraph
Thedirty
secretsof
greeninvesting
Editorial
TheEconomist
TheBBC’s
notdoing
thebusiness
OliverShahTheSundayTimesCityprofiles