Hi Aya
Some of the bigger picture and insights can be gained from the linkages between energy security and geopolitics. Our recent Evelyn Partners Responsible Investment conference 2025 featured Tom Holland, celebrated historian and host of The Rest is History, and distinguished political economist Helen Thompson.
See some key takeaways and links to their discussion, including slides and a panel discussion with some of my colleagues and session by Kaya Axelsson from the Smith School of Enterprise and the Environment, Oxford, from the conference as below.
Regards
James
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Key takeaways
It may prove interesting to put some context to the current asset allocation position for our client portfolios, in view of Tom and Helen's comments on geopolitics. We heard about power shifts principally between Russia, China and the US. Slide 15 provides some points that we might use to explain here. In terms of our global outlook, we are broadly positive on equities relative to bonds as, despite the additional degree of global political uncertainty, we think that the global economy still looks to be in reasonable health. Higher levels of government debt, as we heard about with reference to Germany but also applicable to many other nations, including the US, could weigh on the performance of bonds.
We continue to like some US companies with good opportunities and have recently added to our holdings in emerging markets. While direct investment is not appropriate for all clients, given their risk profile, slides 13 and 14 show China's dominance in renewables and other key intellectual property spheres. This has been highlighted recently by the emergence of Deepseek, but is still broadly underestimated in our view. Finally, we continue to favour gold as it provides diversification for portfolios, and its recent performance demonstrates its value as a hedge against geopolitical uncertainty; particularly driven by emerging market central bank purchases, which we think is likely to continue.
We had a lively discussion about engagement over the course of the day. It may be of interest to you to hear a podcast that we recorded with Professor Kelly Shue at the Yale School of Management exploring the merits of sustainability strategies that involve engagement in contrast to divesting from carbon intensive companies.
In it, the Professor explained her empirical research that posits that by selling out of so called "brown firms", the cost of capital rises and then more short termist, polluting behaviours, such as drilling for more oil, result. As we mentioned at the conference, we are very happy to exclude companies or sectors where clients wish us to do so. Our default investment approach is to use active stewardship by engaging and voting if the investment case remains intact, where standards fall short of our expectations.
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Links to slides and recordings Responsible Investment Conference 2025 | Evelyn Partners:
Energy security and geopolitics: inextricable linkages - Tom Holland and Helen Thompson
How we interpret responsible investment v sustainability related approaches - Evelyn Partners panel
Introducing "Spheres of Influence" for assessing corporate climate action – Kaya Axelsson
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James Doyle
Director, Green Finance, Investment Management
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Original Message:
Sent: 08-04-2025 14:10
From: Aya Pariy
Subject: I need the community's help
Hello Community,
As I read this article from FT, I remembered this post from Will back in 2023 about unreliable friends.
"BP is shutting its low-carbon mobility team in the energy major's latest retreat from its five-year-old attempt to diversify away from oil and gas. The unit was responsible for developing electric, hydrogen and other low-emission solutions for vehicles, particularly trucks. It is the most recent casualty of chief executive Murray Auchincloss's plan to refocus BP on its legacy oil and gas business.
In an effort to increase returns and boost BP's share price, Auchincloss in February announced he was scrapping a five-year-old plan to become a major renewable energy player and cutting spending on green energy by 70 per cent. The strategy shift followed news that US activist hedge fund Elliott Management had taken a near-5 per cent stake in BP and was pushing for radical changes."
This kind of news is upsetting. Will the company make radical changes again in 4 years if the political situation changes? Over the long run, will the changes they make today (away from renewables and net zero, towards traditional oil and gas) help their company? They don't sound like they will help the Planet for sure.
Would love to hear other thoughts or analysis that somehow would show that I simply dont have enough information or dont understand the full picture?
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Aya Pariy
Original Message:
Sent: 13-07-2023 12:54
From: William Goodhart
Subject: I need the community's help
Dear All,
I need your help. I'm writing an article for Sustainable Investor. I've written something about whether investors should disengage with the oil majors following BP and Shell's weakening of their transition plans. I think it's ok, but it lacks a bit of grit and I'd be grateful for any suggestions. This is not an invitation to rewrite the piece as that probably won't work well with 115 people trying to edit a single document, but I'd love some feedback on the piece as a whole and also some ideas for data points that could be added. Thank you!
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William Goodhart
Chief Executive
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