"We forget that all investing is an art not a science"

Rachel Whittaker1

Rachel Whittaker
Head Sustainable Investing Research, member Executive Committee Robeco Switzerland Ltd., Zurich

Rachel Whittaker is Head of the Sustainable Investing (SI) Research Team and and was recently appointed to the Executive Committee at Robeco Switzerland Ltd. She leads an international team of SI analysts, whose fundamental research focuses on the impact ESG issues have on economic sectors and individual companies. She first joined Robeco from 2015-2017 as a Senior SI Analyst and rejoined in 2021 to lead the team. She has also held SI roles at UBS Wealth Management, Vontobel Asset Management, and Mercer’s Investment Consulting business. Rachel started her career in 2000 as a sell-side equity research analyst and earnt her undergraduate degree from the University of Cambridge, UK. She also holds an MSc in Corporate Environmental Management from the University of Surrey, UK, and is a CFA charterholder.


Please describe your journey from being in equity research in London to Head of Sustainable Investing Research at Robeco in Zurich?

I started out on a traditional career path in the investment industry in a graduate programme at Merrill Lynch. I enjoyed the dynamic nature of equity research and understanding how companies operate in different markets, but felt that traditional valuation models were missing the human element and that the pursuit of perpetual growth didn’t make sense in a resource-constrained world. Moving into sustainable investing and studying for a postgraduate degree in corporate environmental management filled that gap for me, it was logical that forward-looking investment decisions should take into account all the possible future impacts both on investments and on society and the planet. I moved to Switzerland in 2010 when there was already a strong SI community poised to become one of the leading centres for sustainable finance, and it has been a privilege to be part of that growth with my own small contribution.

You have been specializing in sustainable investing for over 15 years. The ESG market has developed remarkably. Yet sustainable investing still has its flaws like lack of standards, reliable data etc. How to overcome those flaws?

We often hold sustainable investing to much higher standards than traditional investing and forget that all investing is an art not a science. Investment analysts know that standardised, audited financial statements do not automatically lead to perfect investment decisions so why assume that it would be so for sustainability data? Sustainable investing has come a long way in the last 20 years, we have multiple frameworks designed for different purposes and access to growing amounts of non-financial data. There is still a lot of room for improvement of course, but investor skill lies in interpreting and using the data we have, whether that is financial or ESG data. And from an impact perspective, the absence of perfect data for reporting or measuring should not be an excuse for inaction.

From your point of view: Is the purpose of sustainable investing to avoid risks like climate change or is it to create an impact like the reduction of CO2?

Both, and more! There are multiple reasons why investors are drawn to sustainable investing, maybe to align with their values, or because they think it leads to better informed investment decisions, or to try and contribute to real world impact. The range of products in the market allows investors to pick the products that promise the outcomes they want. The challenge is to look beyond the marketing material and deduce which products will actually deliver those outcomes.

Addressing climate change has the largest focus in sustainable investing. But Robeco has also been addressing biodiversity for quite some time. One of the main challenges here is how to integrate biodiversity aspects in a portfolio. How do you deal with that?

Climate change is one of the main drivers of biodiversity loss, along with deforestation and species exploitation, so we can’t think about these issues in isolation. At Robeco we have been considering the impact that companies have on biodiversity loss for some time, focussing on sectors where these issues are most significant, and we have incorporated biodiversity-related issues into our engagement programmes' exclusion criteria (eg. our palm oil policy). Earlier this year, we also launched our biodiversity road map to develop nature-friendly asset management. Our goal is to better understand biodiversity impacts and dependencies of individual companies and distinguish between biodiversity leaders and laggards in all of our sustainable funds. Our recently launched biodiversity strategy invests in companies that support the sustainable use of natural resources and ecosystem services, as well as technologies, products and services that help to reduce biodiversity threats, or restore natural habitats.

Can you describe how Robeco’s organizational structures and investment processes are aligned to create the best possible results in your sustainable investment products?

We have an internal Centre of Expertise with 50 SI specialists focussed on research, data, voting, engagement, client education and addressing the critical SI issues of the day, such as the impact of climate on portfolios or the developing regulatory environments. More importantly, the SI Center operates in collaboration with all of the investment teams at Robeco to ensure that all of the traditional investment knowledge and experience is combined with the SI knowledge. It’s not easy to keep up with a rapidly evolving regulatory and competitive environment, but we have a senior management team committed to becoming a leader in sustainable investing and we focus on transparency and staying in touch with our investors to ensure that we are meeting their needs and only committing to what we believe we can deliver.

From your professional career you have a broad knowledge about the Swiss financial center. Where do you think it stands out in comparison to other European centers and how can Switzerland meets its goal of building an ecosystem for sustainable finance?

The size and stability of the Swiss financial center is a huge attraction not only to financial institutions but also to bring the best local and international talent. Swiss asset managers are notable for being among the early adopters of sustainable investing, so the commitment of the Swiss Federal Council to sustainable finance and incorporation of sustainability into financial market policy is both a natural evolution, and essential to ensuring that the stability and support for the global economy can be maintained in the longer term. In my view, the active collaboration within the Swiss financial industry, as well as with international initiatives is the key to finding scalable solutions to global problems. And as a global asset manager, we very much appreciate the efforts of the regulator and the industry associations to introduce frameworks with clear goals, aligned with European regulation but with a clear focus on practical implementation.

How do you personally integrate sustainability in your lifestyle?

I believe very strongly that a truly sustainable economy must be circular, so I try to minimise my family’s environmental footprint, reducing waste and re-using, re-purposing or upcycling our things as much as possible. I like to dabble in growing fruit and veg and making my own clothes, but my gardening and sewing skills are a work in progress so we won’t be going off-grid anytime soon!