“Do you think I’m missing a trick?” mused the chairman of the insignificantly-sized investment company Kermitted Asset Management when we caught up the other week. “Long experience would suggest not,” I replied. “Still, if you want a fuller opinion, you might want to sketch in a few more details – or indeed any details at all.”
“Fair enough,” said the chairman. “Remember five or six years back, when I surveyed the green shoots of environmental, social and governance-oriented investment and decided now was the time to answer the call, step up to the plate and give something back to the world in the shape of the ESG-focused specialist boutique we all know and love as Kermitted Asset Management?”
“Indeed I do,” I nodded. “Though I believe your precise words were, ‘I see a wall of cash heading this way and papa wants a piece of that action’.” “Recollections may vary as to the specifics,” shrugged the chairman. “Either way, I don’t believe anybody is going to begrudge me scraping together some sort a living at the same time as helping to save our planet.
“And the point I am trying to make, given the chance, is I chose to attempt this altruistic endeavour – this crusade, some might say – through the medium of asset management.” “As opposed to mime or interpretative dance,” is the response I kept to myself, instead venturing aloud: “Solid choice – 2023 aside, it’s fair to say your decision has generated an impressive amount of scrapings.”
You could – if you really had nothing better to do – read more from Kermitted Asset Management here
“Be that as it may,” said the chairman, waving a hand airily, “what has set me thinking is the giant green elephant in the room you so casually dismiss as ‘2023 aside’. It cannot have escaped even your notice that ESG-focused funds have just recorded their first ever year of net withdrawals – and when your entire inventory of investments can only be described as ‘ESG-focused’, that adds up to Very Bad News Indeed. That being so …”
Sensing a need to cut this long story short, I said: “You mentioned something about missing a trick?” “Consultancy,” said the chairman. “More precisely, ESG consultancy. No longer will Kermitted merely be allocating capital for the betterment of planet, people and other things not necessarily only beginning with ‘P’ – we will also be allocating the wisdom gleaned from our four hard years in the ESG space.”
“As ‘Kermitted Asset Management’?” I checked. “Of course not,” snorted the chairman. “That would be ridiculous. As ‘Kermitted Future Consulting’.” “Kermitted Future Consulting,” I said slowly – and then even more so: “K … F … C.” “Catchy, wouldn’t you say?” beamed the chairman. “I’d say you’ll be catching something,” I replied. “Most likely a writ. But why that name exactly?”
“I should have thought it was perfectly obvious,” the chairman replied. “Certainly the ‘Kermitted’ bit. Then ‘Consulting’ because that is what we will be doing and ‘Future’ because, as we have discussed in the past, we do kind of need a new word for ‘ESG’. And I could not be more confident that absolutely nobody else is going to come up with ‘Future’ to describe the great investment megatrends of the coming years and decades.”
“But …” I began before surrendering and asking instead: “You said ‘the time has come’ but ESG’s been in the doldrums for a year or so – why decide to make the move to consultancy now?” “Again, I should have thought it was perfectly obvious,” the chairman sighed. “Before this year is out, we will have had a general election and, if the polls are any guide – this time, anyway – that will see a few hundred ex-MPs seeking fresh employment.
“It stands to reason a lot of these newly occupationally-challenged will be jostling to earn a crust in their traditional go-to sphere of consultancy and, whether or not another £28bn a year extra materialises from that same election, a fair proportion of them will be eying up the little pot of green gold at the end of the net zero rainbow. If I don’t move now, I risk being stuck at the end of a long queue of somewhat questionable characters. And before you say it – yes, I have indeed spent a lifetime in asset management.”
This nonsense first appeared in the February 2024 issue of Portfolio Adviser
