2023 and Beyond: Geopolitics and ESG
A Conversation Between Christopher Skroupa, Skytop Editor-in-Chief, and Ron Rock, CEO & Co-Founder, Microshare / November 30, 2022
Christopher Skroupa: Thank you so much for working with us into 2023. I’m excited about some of the things we’re doing. I was putting together some of the amazing things that we have discussed. Ironically, I was trying to time- release our last Q&A but the more I waited the more conditions changed in Europe and around the world, and the more things seemed like there was a gap in your comments if compared to current events. So, let’s revisit our discussion and update our readers with your thoughts in real time.
My first question is, from your perspective, if you were to take a snapshot of the world today versus where it was 6 months ago, what do you think, do you think that anything is different in ESG or are the events we’re facing today not necessarily going to impact or pause the advancement of ESG?
Ron Rock: That’s interesting and, boy, has it been a crazy 6 or 8 months. The first is absolutely in North America, the United States specifically, ESG is scarily slipping to a nice-to-have from a must-have just twelve months ago. In Europe, that’s not the case at all. We’re seeing very strong demand. I just spent the last two weeks in Germany and Switzerland and it is as important as ever because they’re closer to Ukraine. They’re experiencing day-to-day their natural resources going away. And Germany is in a real tough spot, having decommissioned most of their nuclear power plants, not having enough wind energy to go around. So, despite all of that, they’re still seeming to be committed to ESG. In the U.S., I’m seeing a softening in importance. The other thing that’s significant is that with rising interest rates, much faster of an acceleration than I think most of us thought, we’re seeing a big downturn in tech. We’re seeing big layoffs in tech. The results are that a lot of your ESG product development initiatives are slowing down. It’s the perfect storm. Customer demand is kind of softening and tech firms are running out of liquid capital to drive innovation.
Christopher: And do you believe that’s one of the causes for the recent bevy of layoffs happening in the tech space?
Ron: I think the reason for layoffs is overall lack of demand, or softening of demand, for what they’re doing and rising interest rates and the tightening of access to capital.
Christopher: That’s interesting. We recently ran, in Stockholm, our conference on ESG impact, of which you were a proud sponsor. To share some context with you, when I put the agenda out, and I started recruiting asset allocators and fund managers, I was getting emails back saying geopolitics and ESG.
In Europe there seems to be a determination to drive forward on ESG, even though we are living in some uncertain times. Why do you think that ESG is persisting in Western Europe, where we may not be experiencing it the same way here in the U.S.? I would imagine that if you were in Poland, given the recent missile attacks, or if you were in a Western European country, it seems like there conditions that factor differently. But I am surprised to see that you experience that ESG isn’t slowing down.