yvonne li
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Redirecting Capitalism for Responsible Wealth Management
TBLI Europe, November 2011
Yvonne Li (yli@avantageventures.com)
Standing at 7 billion
Sustainability issues in:
Food
Water
Healthcare
Natural Resources
Education
Energy
Environment
The ‘Dark Side’ of Capitalism
Short term shareholder value by firms
Maximise profit with little disregard for externalities and costs to society and the environment
Causing imbalances in global economies and trade
Unmitigated pollution
Remember Foxconn
Industry lobby groups
Perception of Finance in 2011
Euro debt woes
Financial meltdowns
Volatility in food and resource commodities
Financial mismanagement
Ponzi Schemes
Speculation
Derivatives
Financial engineering
6
Why Social Enterprises matter
Social/Environmental
Impact
Enhance localcommunities’
livelihood Community
Empowerment Promote sustainable
agriculturalpractices
Preserve scarcenatural resources
Use clean energyand reduce harmfulgreenhouse gases
Financial Impact
Balanced set offinancial returns
Generating profitsto scale impact
Create disposableincomes thereby
stimulating vibrantlocal economies
Why Asia matters
A key growth region for any investment portfolio
Demographics: by 2050, Asia will have 5.4 billion people, constituting 53% of the
world’s total population Rising inequality with record numbers of UHNW joining the global
elite, growing middle class with 1b still living on less than USD1.25 per day
Major socio-economic trends An ageing population Untapped mass “Bottom-of-the-Pyramid” Market Environmental concerns compounded by climate change and
consumption challenges
Potential Market Size in Asia
Refer to AV’s report Beyond the Margin: Redirecting Asia’s Capitalism
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Large demand but not necessary investable
Impact Investing and Wealth Management
Impact investing can be integrated into a balanced portfolio, and regarded as a prominent emerging market strategy. Provides investments in line with personal and family values An investment into key social and environmental trends Aligning investments with priorities of Asian governments,
generate profits on fair costs whilst generating positive social and environmental impacts.
22% of total assets held by HNW are invested in Asia Pacific to the tune of USD8.6 trillion.
A 1% allocation is what it would take to allow social enterprises to scale.
Rational for Responsible Wealth Management
Uncorrelated asset class, reduce volatility
Reasonable returns with reduced risk
Sustainable investing taking into account of triple bottom line
Long term investing
Ultimate emerging market investment strategy
Investing in the most important businesses of the future
Asian based
Support entrepreneurship and local economic development as drivers of poverty alleviation
committed to addressing social & environmental needs
Missing Middle finance; critical investments of USD0.5 to USD3 million
ensure FINANCIAL SUSTAINABILITY as a means of pursuing their bigger agenda
create a sustainable future for Asia
Avantage Ventures
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