Stockholm (NordSIP) – Emerging and frontier markets specialist East Capital, an asset manager headquartered in Stockholm has appointed founding partner Karine Hirn (pictured) as Chief Sustainability Officer. Based in Asia since 2010, first in Shanghai then in HK since 2013, Hirn will now oversee the ESG and sustainability work within the East Capital Group, including the continued full integration of ESG analysis into the firm’s investment process. Despite her full agenda, she answered NordSIP and explained her ambitions as well as the challenges ahead.
While the CSO position is new at East Capital, the group integrated sustainable investment in its philosophy from the start. “Our ESG journey started on day one, when we founded East Capital in 1997,” says Hirn, “as our investment process has always taken into consideration corporate governance, a key risk (upside or downside) when you were a minority shareholder in Russian companies. It has evolved throughout the years with negative screening from 2007, norm-based screening from 2010, becoming a PRI signatory in 2012, implementing our proprietary ESG scorecards in 2016 (enhanced later on with an SDG module), and launching thematic strategies such as China Environmental and Global Emerging Markets Sustainable. We have always believed in the value of engagement and dialogue with portfolio companies and see this as a crucial part of our work as active investor.”
Given such this long-term sustainability background, Hirn has her work cut out for her. “The position of CSO is strategic and covers a number of areas and objectives, such as the ESG investment framework (including active ownership), our cooperation with associations and peers, the reinforcement of our positioning as a responsible owner in the markets we operate including in sometimes challenging emerging and frontier markets, and finally sustainability for our own companies within the East Capital Goup,” she explains. “The role implies coordination on many levels, which suits perfectly a founding partner who knows the company very well since its start 21 years ago! Sustainability is key to what we do and lot of the work is done by the existing investment teams, we do not believe in the “silo approach.”
In the short term, Hirn’s first challenge will be to set the right priorities. “I guess it is the same for any new role; I am lucky enough to have worked closely with the investment teams for a long time and we as an organisation are committed to these tasks so I do not expect resistance the way some similar roles could have in other organisations. What I am to achieve medium to long term is entirely about what East Capital is to achieve. As an investor in hundreds of companies around the world and managing capital from both retail and institutional investors, we have a responsibility towards our clients and towards the markets, by allocating capital where it should, and this way contributing to the achievement of the SDGs,” she says.
Working in Hong Kong, Hirn has witnessed the fast growing interest for sustainability in the Asian continent. “Asia is lagging behind Europe but it is catching up fast,” she adds. “China provides a fascinating example in terms of development regarding green finance and environmental regulations and Japan is making very significant progress in terms of stewardship. Many Asian countries face enormous challenges in terms of sustainable development so we will probably (or hopefully) see strong alignment in terms of government, societies and capital.”
Picture courtesy of East Capital