All Angles Episode 1 - Embrace Complexity: What Sustainability Means at MFS

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  • 45 mins 18 secs
Join Vish Hindocha as he hosts the MFS All Angles podcast - Episode 1, Vish speaks with Barnaby Wiener on wide-ranging topics including altruism, climate change, perspectives on the ESG landscape, and what has shaped his thinking in his career.
Channel: MFS Investment Management

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Vish Hindocha:              Welcome to the MFS All Angles Podcast. My name is Vish Hindocha, and I am the global head of sustainability strategy here at MFS. The goal of this series is to unpack the wonderful world of ESG investing, one conversation at a time.

VO:                              The views expressed are those of the speaker and are subject to change at any time. These views are for informational purposes only, and should not be relied upon as a recommendation to purchase any security, or as a solicitation or investment advice from the advisor. No forecast can be guaranteed. Past performance is no guarantee of future results.

Vish Hindocha:              In this episode, I’m joined by Barnaby Wiener, our global head of sustainable investing and stewardship, portfolio manager and as you’re about to find out, many other things at MFS. We have a really wide-ranging conversation. We end up talking about altruism, Barnaby’s favorite books, climate change, his perspectives on the ESG landscape and so many more things. I hope that you take from this conversation as much as I did. Thank you for listening.

Vish Hindocha:              Barnaby, before we kick off, you’re a well-known entity to many, I’m sure, of the audience, but I thought I’d begin by asking you a little bit about your history, how you got here and some of your career highlights to date. So instead of reading out your illustrious biography so far, I thought I’d ask you to summarize your own potted history and what brought you here.

Barnaby Wiener:           Sure. Well, the honest answer is I got here by accident, but it was a very fortuitous accident. I had no ambition to enter the financial service industry when I was growing up. In fact, when I read history at university, then I spent five years in the British army, and in my mid-twenties, I actually thought I was going to become a screenwriter. But I was disabused of that notion after 12 months of working in bars and restaurants to fund my directionless screenwriting career. So I eventually ended up just trying to get a job and worked for a stockbroking firm.

                                    And then I was in a couple of stockbroking firms over a four-year period, and then I got approached by a headhunter who I knew from my time in the army, who said he was doing a search for a company called Massachusetts Financial Services. This was in late 1997, and I’d never heard of Massachusetts Financial Services. And I went along, really, just to keep him happy, because he was desperate to find candidates and this firm was trying to build a European or a London office.

                                    And I went along and met a couple of people. One was Marcus Smith, the other David Antonelli, both of whom served for over 20 years and only recently left the firm. And I decided it actually seemed like a rather nice place to work and a much more interesting job. And fortunately, I didn’t disgrace myself and they made me an offer, and I’ve been here ever since, which is getting on 24 years.

Vish Hindocha:              Yeah, that’s incredible. And the journey that you’ve had — don’t know if you  wouldn’t mind going into in terms of your responsibilities, not only as an analyst and building out the London team, but also your portfolio management responsibilities — again, some of the audience will be very, very familiar with your current role, but I think it’s really interesting. And as we’ll unpack through this conversation on sustainability some of your positions on the more value-oriented funds — and I’m sure we can get into value growth — it might be really interesting for people just to put some context around some of the comments that I’m sure we’re going to get into later.

Barnaby Wiener:           Sure. I was very lucky in so many different respects, but one thing is, I’ve had the security of working for a very well-established firm that’s run in the right way with very much a long-term focus and a deep commitment to growing the international business, which at the time I joined was irrelevant to the firm from an assets and revenue perspective. But in the early days, it was really like working for a startup. When I joined, there were five of us in total in the London office, across investment and distribution. In fact, we actually moved into our own office the day I joined. When we had our first Christmas party, we actually had to invite our spouses to make it a party, otherwise it would’ve just been too small a gathering to count.

                                    And so I spent four or five years as an analyst with initially just two other people, Steve Gorham, who’s still obviously at the firm, and Marcus Smith, covering Europe. And then after that through the tech bubble and the burst, and then in about late 2002 I took on a role as portfolio manager, initially working with Steve, in fact, on international value, and also starting our European value franchise. I did that for well over 10 years.

                                    And then in 2011, I took on this new mandate of Prudent, it was originally Prudent Wealth and now Prudent Capital, as well, which is obviously the more absolute return–oriented, long-only approach. And in between, I spent six years, actually, as the director of research for the European team until I managed to offload that responsibility onto Chris Jennings.

Vish Hindocha:              So, thinking about the comments, you talked about five years in the army, you talked about your career aspirations before that and how you found your way into MFS. What’s kept you here for 24 years? Why do you choose to do what you do? And again, it’s interesting to think about the evolution of your role, and that you’ve served in so many different capacities, but one of the hardest questions at interview, I think, is what is your why? So I’m going to ask it to you, Barnaby: What is your why? Why do you stay here? What’s kept you here for 24 years? And what excites you about the role that you’re in today?

Barnaby Wiener:           Sure. I think it boils down, really, to two things: One is it’s a really interesting job, and secondly, it’s a really nice place to work. I’ve been surrounded by people I enjoy seeing on a day-to-day basis. And also, related to that, I’ve been very lucky in the sense of, I’ve always felt I had a lot of autonomy. Even as an analyst, the excitement of — particularly coming from the sell side where you have a very narrow coverage given a fairly vast coverage of European stocks —  basically being told to manage my time as I see fit and focus on the things that I think are important and choose what I think the firm should be investing in and having a very supportive group around me, and that’s lasted all the way through. From being a portfolio manager, from being director of research and, obviously, most recently being head of sustainability. So, yeah. It really comes down to that. Fascinating job and great place to work.

                                    And I think the other thing is that, in some ways, I am quite a restless individual. In that respect, it’s slightly surprising that I’m still here after 24 years. But I’ve been able to reinvent myself a few times, as I intimated before. I managed to co-manage the value strategies for many years. But actually, after a while I also began to find the constraints of a strict relative return approach to investing a bit limiting and I was given the opportunity to devise a much more flexible product in the shape of Prudent Wealth and Prudent Capital. Then equally, in the last 5 to 10 years of my career, I’ve become much more interested in the broader impact of what we do. And obviously, that links to the whole sustainability side. And then, I was given the opportunity to really take a leading role there, which has given me a new lease of life. So I think that’s one factor. I’ve been very lucky to keep getting interesting new challenges that I’ve been allowed to take on.

Vish Hindocha:              Definitely. Let’s focus on your latest reinvention of self, then, on sustainability. And maybe, obviously this conversation is trying to dig deep and uncover your philosophy, your views on ESG and integration and where that is. But why is ESG important to you today? And maybe just for the listeners, maybe describe your approach, how you think about that in your day-to-day work as a portfolio manager.

Barnaby Wiener:           Sure. In some respects, it has always been an important part of my approach to investing inasmuch as I’ve always wanted to invest in sustainable companies, companies that are around for the long term and are going to be around for the long term and also managed in the right way. I’ve always put a high value on management quality and corporate culture. And that’s always been important to me, and I think that’s an integral part of sustainable investing.

                                    I think more recently, and I say recently, in the last 5, 10 years, I’ve become more and more conscious of some of the very real shortcomings of our ecosystem. And when I talk about our ecosystem, I’m not just talking about the asset management industry. I’m talking about the whole financial and corporate ecosystem that we’re a part of. And I think that on the one hand, this clearly excessive short termism, which manifests itself in so many different ways, and that’s unhealthy for long term value creation, but it’s also really unhealthy for society because it incentivizes the wrong behavior. And allied with that, I think I’ve become much more conscious of some of the social inequities and the environmental challenges we face.

                                    And so if we want our ecosystem to endure and we want our industry to endure, we have to play a part in correcting that imbalance. And so that’s, I think, why my interest has gone from being remote to acute as a result of that.

Vish Hindocha:              Is there anything you think that catalyzed that for you? One thing I appreciate — just standing back a little bit — about you is the clarity of your thinking and the way you articulate your thought process. And I’m just curious, as you think about going from remote to, really, in a driving-seat position on how we are doing this, not only as a firm but our stance in the industry, I’m just curious if there’s anything that’s really influenced you. As we all know, I think the marketplace and many investors are on a journey, and I’m always really interested as to when the light bulb moment might have been. It may not have just been one moment. It’s very unlikely to be just one thing. But just curious:  Is there anything that stands out to you as you think back to anything that — where the penny really dropped, in terms of the relative importance of those two major factors that you just mentioned?

Barnaby Wiener:           It’s hard to necessarily pinpoint one thing, but what I will say is that if I look at where my life has evolved, I started out  — for the first 30 years of my life, I think, I was interested in nothing other than personal gratification of one sort or another. I was seeking pleasure and experience and really had very little energy for anyone else’s problems. I was basically deeply selfish. And then I think the next phase was getting married and starting a family, so I suppose I was marginally less selfish, then, to look out for my immediate family. But I think it was only, really, when I probably turned 40, or around about that time, that I really started to think about the bigger picture in any real earnestness.

                                    And I initially thought about it more from a philanthropic perspective because I was thinking, what could I do to share my good fortune and be a bit more thoughtful in how we thought about philanthropy. And it evolved from that because my wife and I set up a charitable foundation, and we initially just thought in terms of how we give the money away, but then she kept on badgering me and saying, "Well, how are we investing it?" And I said, "Don’t worry about that. We’re invested in making as much money as possible, then we were..."

                                    And eventually, I started to question that. And actually, there’s a very interesting guy called James Perry, who is the cofounder of a company called Cook. You probably are familiar if you’re in the UK this is the frozen food business. They have shops in most towns now. And a very interesting, well-run company, and indeed a B Corp. And he’s a real cheerleader for this idea of how to deploy capital in a way that’s aligned with philanthropy. And he wrote a brilliant little article called “The Return of Capital,” and it was all about the importance of capital markets in terms of resource allocation and how, if done properly, that could be transformational for the world. And there’s one wonderful quote in it, which is, "We all know money talks, but can it sing?" And that really resonated with me.

                                    And so, I think that was probably the start. If there was one penny drop moment, it was reading that and thinking, yes, we need to really rethink how we deploy, how we think about money, because we live in this world where humans love to be binary. We like to say it’s black or white, it’s yes or no. And so people are much more comfortable thinking, okay, I’m giving money away here and I’m making money there, and this is philanthropy and this is business, and the two are totally separate. But actually, that’s a really illogical way of thinking about it because basically everything is an investment of one sort or another and every investment has an impact. So I guess that that was probably the moment that I really started to think.

Vish Hindocha:              I love that. We know money can talk, but can it sing? And I agree with you on a lot of things, obviously, but mental accounting is definitely one of them. And maybe we’ll talk more about the philanthropic side. I’ve become, over the last few years, really interested in the effective altruism movement as I explore that for myself and some of the principles. And one of the things that comes to life, there’s a book that was put out recently of “doing good better,” which highlights, for me, a point that you just made, which is we really desire things to be good or bad or right or wrong, but often our intuitions are misleading or it’s not always that easy to determine what is black or white on a particular issue.

Barnaby Wiener:           I love that book and I couldn’t agree more, and just to make that point, part of the penny dropping was the realization that the investment world needs to think about the impact. But it was also, and I know this is a bit of a tangent, but it was also that the philanthropic world needs to think more carefully about being rigorous in its approach to capital allocation because so much philanthropy is driven from the heart and smart people check their brains  at the door when they walk into the philanthropy room. That has to change because as that book demonstrates, there’ve been so many unproductive philanthropic projects and still are.

Vish Hindocha:              Yeah. And so William MacAskill, who wrote the book Doing Good Better, co-founded the Effective Altruism Movement, would be a recommend, it seems, from both of us. That’s unscripted, but great.

                                    So if in the philanthropic world, Barnaby, we have to vote or move with our head and our heart, so not leave our investment brain at the door, I wonder if a listener could accuse the investment world of leaving their heart at the door and investing purely with — like you talked about, the industry itself has moved to a much more short-term-focus obsession with relative benchmarks and incentivizing short-term optimization behavior, which may actually conflict with some of our longer-term aspirations of actual value creation in society.

                                    I just want to — again, given your purview now —  is there anything that you think about when it comes to the conventional wisdom or the prevailing wisdom in the marketplace that you believe contradicts that? Or we could be thinking of that differently, as we begin to segue into your process and how you think about differentiating your investment process from the rest of the marketplace as an active investor. Just really curious as to your thoughts on where you think the marketplace in general has got this wrong or where you hunt to see where we can differentiate and create an advantage.

Barnaby Wiener:           Yeah. Well, firstly, I do think that the head and heart rule applies to everything in life. I’m slightly nervous saying that because the one thing I don’t want to give anyone the impression of is that as an asset manager we should be allocating our clients’ money with a view to achieving philanthropic goals. That’s not our mandate. But what I do think is that so much of investing requires qualitative as well as quantitative analysis, and a lot of qualitative analysis needs to tap into the right side of the brain and not just the left. And so, I think if I were to simplify it, I think one of the problems in investing is it’s almost unacceptable to deploy the right side of the brain.

                                    I don’t know if you’ve ever read a book called The Master and His Emissary. Sorry. I know this is turning a bit of a book recommendation, but — by a guy called Ian McGilchrist. But it’s fascinating, and he goes into this a lot. And his premise is we’ve tried to create this divide between these two parts of our brain, between the logical, reason-driven side and the intuitive, creative side. And that’s had disastrous consequences, and actually both are a critical component of success and of humanity working properly. And I think that’s true in investing. I think so much of investing requires both the rigorous, objective, quant-driven analysis, but also, we need to free up our creative and intuitive side because that often is a source of great insight.

                                    So yeah, that’s probably rather a broad and overly right-sided answer to your question.

Vish Hindocha:              No, I agree. And one of the things that I really appreciated learning from you a few years ago was, it was a similar dichotomy that the marketplace has created around value versus growth investing. And I think you put it to me very vividly, that why would I cut off half of my brain? Why would I want to invest in a stock that is at astronomical valuations and unlikely generate return equally? Why would I invest in something that might be a terrific valuation but has no growth prospects? To invest with only half of your mindset doesn’t really make much sense. So I appreciate that what you’re talking about there in a slightly different context.

                                    Let me be more specific. Maybe if you could just describe how you think ESG integration, particularly in the last few years as the industry has moved and there’s so much coalescence around this from every stakeholder that we care about: our clients, the regulators in the marketplace, corporates themselves and the data providers, et cetera. There’s really so much momentum behind this. How does that affect your process for the research, the selection, the portfolio construction that you do on a day-to-day basis?

Barnaby Wiener:           Well, I think that the increasingly intense focus from clients and regulating this is great and welcome, but it’s also entirely aligned with what I think — and I’m not alone in this — most of us on the investment team think is how we should be doing our job. And that is thinking through some of the less easily modellable or less modellable elements of the investment equation.

                                    So I think a big part of the problem that we’re addressing here — and it goes back to excessive short-termism, et cetera — is people tend to get focused on the numbers and specifically for investors in companies, whether it’s equity or fixed income, modeling companies’ profitability over a relatively short time period and assessing whether they’re going to meet or beat expectations, and it always comes down to the earnings model. And as a result, the risk is you underestimate some of the less modellable but equally, if not far more, important characteristics of a durable business.

                                    So, I think there’s a very clear movement that is part driven by external stakeholders but it’s actually also sort of, I think, from within the industry. We’ve got to address that and try and better understand some of these material but hard-to-model risks and opportunities that companies are exposed to.

                                    And there are so many different flavors of this. There are obviously very specific social and environmental issues that certain companies are exposed to. So obviously, companies that emit high levels of CO2 are going to have to find ways of transitioning their business models so that they stop doing that, and for some  it’s going to be easier than others. And again, it’s very, very industry-specific, in some cases, very company- specific. Equally, there are some companies that may have benefited from being able to lower their wage cost either by offshoring or by basically moving to less unionized labor, and that trend is unsustainable and in fact I think is likely reversing. So those sort of risks.

                                    But I think what we also need to do is just take a step back a bit and try and understand and get a feel for the softer and less intangible aspects of corporate health. I will say we can’t just rely on the numbers to tell us whether a company’s in good health; we’ve got to lift up the bonnet and look beneath and really try and hear the heartbeat of the company and understand what goes on inside it. What are the values of the organization? What is the relationship between management and employees and other stakeholders? And do employees like working there? All those sorts of things.

                                    And it’s hard. It’s really hard to get to build tangible evidence on issues that are by definition intangible. But having said that, actually, when you — when you see it, you know it. And there are definitely companies out there that just stand out in my mind for having exceptionally strong corporate cultures, and I’ve always tended to gravitate towards those in investing.

Vish Hindocha:              Again, I think you’re making a fascinating point, and I’m glad we’re talking about culture, as nebulous as that can be, because lots of ESG risks and  opportunities, if you like, are by their very nature, intangible, hard to measure, hard to properly quantify and often lived outside of models and don’t have long histories going back a very long time. We’re seeing that with climate change, we’re seeing that with human rights risks, how do you quantify that in a way that is economically priceable by an investor or even a corporate or in the marketplace.

                                    And at the end of the day, I think this is a judgment call that ultimately you have to make. Now, that doesn’t mean that there aren’t assessment frameworks that you use. And again, hopefully we can talk about some of them. But I think that’s a really powerful point. And I think that’s what makes it, for me, actually really fascinating. The fact that I’m a big believer that the best practice, the science, hasn’t fully crystallized on how we’re going to do this. So it’s a really actually exciting field in our marketplace. It can be scary, but actually to embrace that is where I think the value is going to be. And so again, I don’t know if you agree with that or if you think about that differently. But maybe if there are some specifics in your portfolios that we can talk about, in terms of the process, the thesis and any shifts that you’ve seen over time as you’ve thought through some of these issues.

Barnaby Wiener:           Well, I definitely agree that science can only get you so far. I sometimes think that we have the same view of science now that people had of religion 500 years ago whereby religious beliefs were set in stone and if the priest said something was so it was so and if you disagreed you might get burnt at the stake as a heretic. And I almost feel that’s true with science, and I’m not one of these wacky anti-vaxxers or anything like that, but I just think it’s important to recognize that a lot of science involves a lack of precision, a degree of speculation, that not every variable is clearly understood. And of course, science changes. So science is continually evolving, and people are discovering new stuff.

                                    So I think, bringing this back to ESG, it’s a really — the whole area of ESG, which needless to say, because this is the world we live in, is everyone is desperately trying to come up with tools and systems to enable us to measure it. But so much of it is unmeasurable, and as you say, on the social side, really, there’s a few metrics you can look at and say, "Well, that’s interesting," like corporate turnover or wage disparity or stuff like that, but even those metrics can be very misleading. But you can’t put a number on human experience, and everything about social is human experience. What’s the employee’s experience like? What’s the supplier’s experience, what’s the customer’s experience? So all of that is by definition unquantifiable.

                                    And then even on the environmental side, where there’s more scope for measurement, the measurements are imperfect. If you take carbon emissions, for example, we probably have pretty good data on what companies’ scope one and scope two emissions are. So scope one is the emissions that’s generated directly from their operations Scope two is the emissions that are generated from the power that they buy. But what we have very little real understanding of is the scope three emissions, in other words, the emissions that are created up and down the supply chain, up and down the value chain, so both by suppliers and customers, and that’s much harder to measure, and in many cases, it’s much more significant. So, if you take, say, some of the food companies, they have very high scope three emissions given the agricultural-based supply chain, and then obviously oil and gas companies, they don’t have very high emissions for scope one and two, but they have huge emissions in scope three for obvious reasons.

                                    So all of this, it’s an interesting metric, but it doesn’t tell you the whole story. So there’s no substitute for actually engaging the brain and trying to use judgment as well as objective data to arrive at a conclusion. And then the final thing, of course, is it’s one thing to measure what a company is doing right now, but in the case of climate change, what matters is where a company’s going. The fact that an oil and gas company has a very high carbon footprint is not a reflection necessarily that it’s a bad company. Of course, it’s got a high — they produce oil and gas. And that oil and gas, by the way, is absolutely critical to the functioning of humanity. If we stop using oil and gas tomorrow, that would trigger a human catastrophe on a different level than anything that could be triggered by climate change.

                                    So trying to figure out how the world is going to transition off fossil fuels and over what time frame that’s achievable is really difficult and cannot be computed. There’s just too much uncertainty and imprecision. So in our job, we have to figure out how different companies are positioned to understand the extent to which the risk is manageable or not and therefore how to price it, and also to understand which companies in different industries may be ahead because obviously that’s a source of competitive advantage and therefore an opportunity. And we have to engage with companies, too, because as well as trying to fit whether they’re good investments, we want to make sure —  as you know, we’ve signed up to some major collaborative initiatives like Net Zero Asset Manager initiative and the Climate Action 100+.

                                    And so we are part of a much broader asset manager investment ecosystem that’s trying to encourage companies to do what needs to be done to help decarbonize their operations. But a lot of time, we don’t know and nor do they, so there’s an element of, we have to be forceful, we have to say, "No, you’ve got to do this," but also be humble and recognize, well, we don’t necessarily always know exactly what it is they’ve got to do. So it requires a blend of different skillsets and different ways of thinking that don’t necessarily accord when the natural tendency most people have is to simplify everything and put it into a box and you bring it down to a simple binary outcome.

Vish Hindocha:              Yeah. Very much agree, especially on the need for constructive dialogue to create real change. I think it’s tempting in this binary desire to — or these heuristics that we have —  to simplify our lives to think that you’re either an activist investor or you are passive. And so I think there’s more work being done on this by various academics, but this idea that you can be more constructivist as an engager actually, more long-term-oriented, more open in dialogue, as you say, more humble, to recognize that our job is not to tell an energy company how to run their business but to represent the views of a stakeholder that is an owner, a part-owner, of that business or a lender to that business, and how do we help them understand the outside noise and signal and how to transform and be a part of that journey? I think that’s a really critical point that I think we are going to stand on for quite some time.

                                    As you think about — obviously this is such a broad area. Are there any themes in the world of sustainable investing? So you talked about risk and opportunity and weighing the tradeoffs and thinking about that. Are there any themes that you are watching that you think about playing out that might be a material risk or opportunity for your strategies?

Barnaby Wiener:           Yes. So one entry, and I touched on this earlier, is a lot of the focus on climate change has been focused on the energy transition. And the energy is, I don’t know, 70 to 80% of all carbon emissions. So to the extent that we can decarbonize power generation and then electrify many industries or transportation and heating a building that previously would’ve directly used fossil fuels, that will obviously have a huge impact.

                                    I think that what’s probably had less focus thus far is the agricultural supply chain, which is a very significant source of carbon emissions, and not just carbon emissions but actually also any number of environmental and social risks: soil erosion, biodiversity loss and in some cases very serious social concerns. Child labor, modern slavery probably are fairly prevalent in parts of the global ag supply chain. And as we touched on earlier, it’s very difficult for companies to always know what’s going on down the chain. They have pretty good visibility into their immediate suppliers, but what they don’t really have is much visibility into supply chain beyond that. But ultimately it’s their responsibility. And so there are externalities there that they’re not currently paying for and nor are their customers, and so what happens when that changes? So that’s definitely one concern.

                                    And then, on the same theme, I suppose, of the importance of the land and natural capital, I’m interested in what the potential for things like forestry and timberland is as a potential solution. And not just forestry, but actually the marine environment. It’s quite hard to play this. You can play forestry through. There are obviously timberland investments you can make. Harder to do it on the marine side. But I think that we are still exploring and trying to understand the extent to which nature can provide the solution to carbon sequestration and I think that could be a very interesting theme.

Vish Hindocha:              Agree. I think each of us in this space, our heart probably goes to one particular theme at a moment in time. And of course there is so much energy and focus on climate right now. We are talking right now just in the aftermath of COP26, where there’s obviously lots of pledges around protecting the forests and limiting methane, etc., etc. So climate is definitely on the agenda, and very high up the agenda. For me personally, biodiversity loss is, I think, going to be the thing that dwarfs climate change. And again, that’s an opinion.  and there’s some really interesting work that’s only really just emerging on the economics of biodiversity loss and how we think about it. But if climate is hard — and I completely agree with you on how we measure it — then nature-based solutions and biodiversity loss for corporate is 10 times harder in terms of how they’re really going to measure their impacts on some of those. So again, really, really interesting on how to think about some of those opportunities.

                                    And then to your point at the end, how we play them. So Barnaby, maybe some quickfire questions to end, in terms of taking a step back and thinking again about we’ve talked a lot about books on this podcast. Again, this is in the middle of November, so people are thinking of furnishing their Christmas reading lists. Is there any book, article, piece of literature that you’ve shared or recommended the most? It doesn’t have to be specific to sustainable investing, just generally that you think is the most thought-provoking.

Barnaby Wiener:           I always struggle with that question because I need to go and look at my books-I have-read list, because I then uncover millions of books that are absolutely wonderful, and I could recommend more highly.

                                    But given what we’ve been talking about, there’s a couple that come to mind. One is a book called Wilding by Isabella Tree, which is about the re-wilding project that she and her husband carried out on a 4,000-acre estate in Sussex, which is actually very close to where I live, which is fascinating. It’s beautifully written, and it talks to a lot of the issues, including around biodiversity loss and biodiversity gain, when land is managed more —So I really enjoyed that book. But for anyone interested in natural capital solutions, I couldn’t recommend it more highly.

                                    And then on a separate note, I just think going further back, Nassim Taleb’s book Fooled by Randomness, which I think I read about nearly 20 years ago, is, I think, a must read for anyone, not just in investment. I’m a big fan of Taleb. I sometimes think he would’ve sold many more books if he’d employed an editor, but they’re all very stimulating, and that was his first one, and I think just the whole notion of how we fail to understand sometimes how random the world is. And we’re constantly looking to create patterns because it makes us feel better and leads us to all sorts false conclusions and a false sense of security. So I think anyone who hasn’t read that should definitely rectify that.

Vish Hindocha:              We talked a little bit, well, a lot actually, about philanthropy and work that you do outside of MFS. Is there anything else that you devote your time to? I know you are home today with your dog, which I’m sure takes up your time. What else is taking up with your time, Barnaby, outside of thinking about sustainability and managing portfolios on behalf of clients at MFS?

Barnaby Wiener:           One of my challenges is that, in all honesty, I feel that I’m a bit like a small child that’s entered a sweet shop and is walking around, and I remember my son being like this when he was little, and gathering things that he wants. It’s a sweet shop or a toy shop, and you keep loading up sweets or toys, and you can’t actually carry them all, but you can’t bring yourself to put any of them back. And that’s slightly how I feel about my life right now, because I’m pretty full on, obviously, with responsibilities at MFS and the sustainability front and also as a portfolio manager for Prudent Wealth and Prudent Capital.

                                    And then I mentioned this: The foundation we set out, which takes out probably the biggest part of my spare time. And then there’s all these other things I want to be doing, like I’m a very keen sailor and I love being outdoors. I love going for long walks or to ride my horse when I can at weekends. So all these different pursuits that I want to — and there really isn’t room for them all. So that’s, I suppose, the curse of good fortune, of having lots of fun things to fill one’s day.

Vish Hindocha:              Lots of exciting hobbies. Last thing: I’ve learned through my reading of behavioral science that people only ever remember two things. It’s the peak end rule. They remember the best part of a conversation, and they remember the very last thing. So the very last thing I want to ask you is: If there was one message that you would love to give the listener and our clients in the audience today, what message do you think is the most important to get across to them?

Barnaby Wiener:           Embrace complexity. And related to that, be comfortable with uncertainty and vagueness and nuance, because that is the reality of life. And every attempt you make to simplify it and compartmentalize it reduces your understanding of the world.

Vish Hindocha:              Thanks so much, Barnaby. I really, really appreciate your time and your pearls of wisdom throughout this conversation. Thank you, also, to our listeners, for joining us for this, our inaugural podcast episode. In future episodes, I’m going to be speaking with key members of each of our ESG working groups on the important topics, such as climate change, sovereign risk, societal impact and of course, governance. The next conversation is going to be a deep discussion on climate change, so please stay tuned.

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