Ignacio Perea: "COVID-19 has rolled out a red carpet for sustainability-linked investments."

Ignacio Perea Vall Banc sostenibilitat

Since last October Ignacio Perea has been the new Investment Director of Vall Banc. His incorporation coincides with the bank's firm commitment to sustainable investment models. Perea has more than 20 years of experience in asset management and risk analysis and has a clear vision of where the future of the financial sector lies. EL PERIÓDICO spoke to him about these new investment models that involve investing responsibly.

You have joined Vall Banc to strengthen its investment area, more specifically to lead the adaptation to the new international regulatory framework. What are the changes that need to be made?

The entry into force of the new international regulatory framework involves a series of changes not only at Vall Banc, but across the sector, as well as others aimed at greater clarity in the type of advisory or management services provided. It also involves elements of transparency. There is a great deal of effort being made, but the level of demand from Europe is very high, especially in terms of the costs applied to customers. Vall Banc is already working on incorporating this way of thinking and all the elements linked to sustainability into what it offers.

What do you mean?

Sustainability is not only about the environment, but also about social elements and good corporate governance. It has implications from gender equality to the inclusion of the disabled. We follow the principle of sustainable development, which means that we establish an intergenerational contract in which we want future generations to have the same opportunities as we do in terms of employment, social aspects and others.

I understand, therefore, that your arrival at Vall Banc has not been accidental and that the bank wants to make these types of investments.

Absolutely. We don't want it to be a marketing issue. We seek to incorporate this into our entire investment process in a rigorous manner and following European standards. We have tools that allow us to measure their application and are also committed to training. In this regard, we are in the midst of a certification process for the entire management team and will probably even extend it to elements of the sales team. We are working to have a common language within the company. In this sense, my presence is not a coincidence. On 10 March the first wave of regulations will come into force, especially in Europe, and although Andorra is not directly affected by the Eurozone, we aim to comply with these best practices and not wait to be forced to do so.

How is Vall Banc implementing these changes?

In addition to thinking about new products, we are reviewing the ones we already have to adapt them and incorporate new attributes. Now, not only do we look at the financial criteria, but we have a tool to measure sustainability ratings: environmental, social and good corporate governance. We look for best practices in business models; for example, we are measuring the carbon footprint to know the CO2 emissions of the companies in which we invest and which we are financing. Our idea is to gradually incorporate other metrics in addition to profitability, such as water management or waste treatment. In this way, we can give our customers a broader and more comprehensive view of when they invest, which also has a number of consequences that go beyond that. We want it to be an experience of sustainability.

Does Vall Banc also apply these sustainability criteria in its operations?

Yes. We are organising an internal working group to apply all these concepts across the board. Some of the management team is new and we are in the initial phases, but we are all pretty much aligned to the fact that it is a fundamental element, not only for our product offering, but in terms of how we operate on a day-to-day basis.

Are investors aware of this new way of investing or is there still a bit of awareness to be raised?

We must differentiate between the institutional investor, who is already very aware, and the minority investor. Of the former, we have some customers who are already starting to ask us for it; as for the minority investor, they may be sensitive to these issues, but they are not aware that they can invest. In this sense, we need to disseminate information on issues such as the carbon footprint, the circular economy and the 2030 Agenda; and we should also distinguish between sustainability and solidarity. Our core mandate is to make our customers money. Solidarity is a key element but our customers are more focused on implementing a system that can make a positive impact without sacrificing profitability.

You have more than 20 years of experience in the international financial sector and now you have just started in Andorra. What situation did you encounter regarding sustainability?

I have found a very interesting situation, because Andorra, as a country, is very sensitive towards sustainability; and as for the financial sector, perhaps it has been highly focused on corporate social responsibility (Vall Banc also makes its contribution in this sense), but I do think we have to change the investment processes in line with what we are seeing in other European countries, such as France, Germany and the Scandinavian countries. We must be more ambitious and Vall Banc is already on that path. In fact, it is a signatory to the United Nations Sustainable Investment Principles. We must focus on outreach to help educate our customers, but we believe we have to work very hard to achieve our goal.

Which are the sectors where this change in trend has been most noticeable?

Perhaps where it is being most noticeable is in everything related to energy. In this respect, it is going very fast. Also in new technologies, the world of sustainable fashion, or companies in the food world, which are extremely concerned about the proper management of water. It is being noticed in all sectors, so that in the end, it becomes a social demand. Public awareness is pushing brands to get their act together in a lot of ways beyond the transactional elements.

Since you started specialising in sustainability, what is your assessment of how the financial sector has changed?

When you start researching, you realise that sustainability gives you a better analysis of the risks than when you only look at the income statement, because you see other elements such as reputational risk. The perception of minority investors has also changed a lot and they are now more interested. And another very important element has been the effect of COVID-19, which has focused environmental concern on health and the most vulnerable groups. It has humanised us and this has rolled out a red carpet for everything related to products and investments linked to sustainability.

 

 

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