Sustainable Investing 1: Wendy Cromwell – The $170 Trillion Opportunity

**Ted Seides** (0:01)
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**Wendy Cromwell** (1:10)
Cheers.

**Ted Seides** (1:17)
Hello, I'm Ted Seides, and this is Capital Allocators. This show is an open exploration of the people and process behind capital allocation. Through conversations with leaders in the money game, we learn how these holders of the keys to the kingdom allocate their time and their capital. You can keep up to date by visiting capitalallocatorspodcast.com.
In January, James Aitken told me, It doesn't matter what you think about ESG, the clamor will only increase, fund flows will accelerate, and we need to set our cynicism aside and be mindful of the consequences. It's going to be with us for a long time to come. Ever since, I've grown increasingly curious about the megatrend of sustainable investing. Climate change dominated the discussion at Davos a few weeks after, and social issues about the treatment of workers are front and center since the onset of COVID-19. This mini-series, Sustainable Investing, The Next Frontier, is my effort to learn alongside you through conversations with serious, passionate practitioners in the field. For the next month, you'll hear conversations twice a week in a familiar style and format, all focused on this important investment area.
My guest on the first episode of Sustainable Investing, The Next Frontier, is Wendy Cromwell, Vice Chair of Wellington Management and the Director of Sustainable Investment at the firm. She joined Wellington out of business school 25 years ago and has been there ever since. A year and a half ago, Wendy also became one of two asset managers on the 10-person board of the UN PRI, or United Nations Supported Principles for Responsible Investment. PRI is the world's leading proponent of responsible investment, canvassing 2,500 signatories globally across asset owners, asset managers, and service providers. Their mission is to understand the investment implications of ESG factors and support the incorporation of those factors globally. Our conversation discusses Wendy's path within Wellington, the lingo of sustainable investment, market inefficiencies for an active manager in the space, implementation of sustainable investing across a large asset management firm, growth of interest in sustainable investing, integration of scientific climate research, rapidly rising interest and research in social considerations in companies, and developments on the come with carbon footprints, divestment, and regulation. Please enjoy my conversation with Wendy Cromwell in this first episode of Sustainable Investing, The Next Frontier.
Wendy, great to see you.

**Wendy Cromwell** (4:11)
Hi, great to see you virtually, Ted.

**Ted Seides** (4:14)
Well, this is our first in what's going to be a really interesting series on sustainable investing. There's a lot of great stuff to cover, but I want to start as I always do, and really talk about your background and your path to being in the seat you occupied today.

**Wendy Cromwell** (4:31)
Okay, great. Well, I have been in the asset management industry for almost 25 years now, and much of my career has been spent on the investment side, and most recently leading our multi-asset business. About two, two and a half years ago, and speaking with our CEO, we noticed a lot of sustainable investment content coming up from the bottom up with our investors and others at Wellington, including some from within my former team, where we were focused on impact investing.
We thought that we needed to knit all of that together and really put some strategy and resources behind it in a different way than we had already. He asked me to lead this initiative because inherently sustainable investment crosses all asset classes and because I had this inherent interest based on the work we had done on impact investing in public markets. So that's been my evolution into the space.

**Ted Seides** (5:29)
Well, you know, I had this great conversation with Jean a while back and she had such a fascinating background. You're going to have to just take me back into how you first got interested in investing in the first place.