How to Find Experts for Our Project Interviews?

Project Updates: “Lazy” investors?

Desk research and interview are the main methodologies our team used in the project. Through interviews, we obtained insights from different investors about their investment strategies that incorporate ESG factors. Through desk research, we found support from research and surveys to determine if our interview samples can be representative. 

According to our interviews, it’s interesting to look at the changes of the trend in investment strategies. Like what my classmate said, “In 2016, there was no one looking at ESG in their due diligence. However, in 2019, it seems like everyone has taken it into consideration.” This is surprising me and making me believe that what I am learning in this semester is one of the trends in investment, the world has started to change, looking at both financial returns and impacts. Especially after the Black Lives Matter and COVID-19, the interest on social issues and climate changes has increased. However, in the US market, the majority of investors focus more on financial returns even if they take sustainability factors into consideration. Looking at long-term value and focusing on inside-out aspects are the trend of the US market, but it will take many years for the US to catch up with the EU that considers both outside-in and insider-out in their investment strategies.

Talking about investors, I think “lazy” can be used to explain some phenomenon in the current US market. For example, investors have high demand for ESG ratings. One of the experts who we interviewed mentioned that many investors even do not know ESG frameworks such as GRI, SASB, and TCFD. They are “lazy”, they don’t want to spend time looking at different frameworks or collecting relevant data. Therefore, looking at ESG ratings is the easiest way to figure out how they can do “right things”. Some institutional asset managers also talked about the request from asset owners – they need ESG ratings to see their impacts, for example MSCI. 

However, inconsistency is one of the big issues for using ESG ratings. Some investors support standardized ESG ratings. More investors think a standardized disclosure framework should be the current priority. Lack of data is the biggest challenge for investors who are willing to incorporate ESG into investments. Encouraging corporations to disclose as much as data is important for investors to make their investment decision and for rating agencies to rate different companies by using their own frameworks.

Teamwork: How to find interviewees?

Outside-in and inside-out are two important aspects that our project focuses on. However, not so much research talks about inside-out – impacts of companies’ business on society and environment. Therefore, interviews are the main access to collecting information. Our team has already interviewed 20 people including asset managers, asset owners, professors, and rating agencies. However, we have sent more than 60 emails, only one third of them accepted to talk with us. Finding interviewees is the biggest challenge for us in the second half of the semester. There are several approaches I think are effective to get interviews.

First, professors are always willing to help students. On the one hand, professors’ insights on ESG investing are helpful for our project. We know the current trend of investment, how some investors incorporate ESG factors into their strategies, and policy suggestions. One the other hand, we have more than 5 interviewees who are recommended by professors. Because of professors’ introduction through emails, it’s much easier for us to successfully schedule interviews with them.

Second, guest speakers are happy to answer students’ questions. First, by asking guest speakers questions in or after classes, you can get some answers for your project, there is no need to schedule a meeting with guest speakers since you already get their answers for your questionnaires. Second, I prefer introducing my project to guest speakers after class and asking them if it’s possible to schedule zoom meetings with them. Through the meeting, I got more information compared with asking them in class maybe because of no time limitations.

Third, reaching out to alumni on LinkedIn is also a way to get interviews. Although not all alumni will reply to our requests, their response rate is higher than others. Meanwhile, when I have opportunities to participate in social events, I’d like to talk with alumni working in relevant fields about our project, looking at if they want to share more with us. 

The second half semester was busy – a lot of meetings and assignments. For the busiest day, I had 5 meetings - meeting with my group members, discussing different projects, and holding meetings. I really appreciate my group members and the people we interviewed. I learned a lot from this project, especially how investors and rating agencies use ESG information.