Marina Severinovsky, Schroders’ Head of Sustainability for North America speaks to Best Execution’s Lynn Strongin Dodds about sustainability, opportunities and diversity & inclusion
Can you please tell me what is your day to day role is at Schroders?
As the cliché goes, there is no typical day to day! The role that I have is really fun as it is like a hub in the wheel, and there are many spokes attaching you to lots of different efforts across the business.
So in pushing the Sustainability effort forward in the US, my role covers elements of both product development and supporting our investment teams as they enhance their ESG integration or move down the path to Sustainable or Impact offerings, or as they seek to better leverage our central tools for their research, reporting and active ownership efforts. Another component is working with policymakers, regulators and industry bodies to help drive the direction of travel in terms of how Sustainability develops in the US.
I may also be spending time with my clients, from our external clients and prospects, to whom I am conveying our capabilities or offering our partnership, to my internal clients, who are the sales teams, to ensure that they are educated and trained on our approach, have the collateral and support they need from me, and are comfortable being at the forefront in terms of telling our story. In every role I have had at Schroders, sales teams have been my internal clients, so my goal is always to be proactive, responsive and easy to work with, so that they always want to come to me! Another thing I may do on a given day is push forward key projects or initiatives around things like joint research or co-engagement with clients, roundtables and other events, designing bespoke solutions for clients, and providing education and knowledge share.
Furthermore, I may on any given day be working with our communications teams on different campaigns or initiatives,or working with our PR team and doing various types of press, or creating content, like presentations, articles, white papers and blogs (which I especially love doing, as I grew up wanting to be a novelist, so this is now my creativity outlet), or speaking at industry events to share our message.
How do you plan to develop the group?
Luckily, we already have tremendous resources and support. One of my favourite roles is being a conduit between the US market and the central Sustainability team in London, which includes very thoughtful thematic researchers, integration experts, great active ownership, engagement and voting professionals, and a robust data and models group.
We also get a lot of support from our networks of ESG specialists who sit on various investment desks or sales teams and client support teams, and are empowered to lead ESG efforts on their desks and in their groups. At the end of the day ESG is not about our 30+ central team professionals, ESG is about our entire firm and everyone who works here. Schroders has made ESG a defining characteristic of our brand and business.
What skillsets have you called upon?
The role quite naturally aligns to some of my top strengths, which are influencing (often without explicit authority) and focused execution. Because there are so many competing threads and priorities at any given time, the ability to stay organised and keep pushing many balls forward at once is really key. And my existing relationships from many years at the firm, across many teams, as well as my ability to build new ones, is critical to finding the support needed to move initiatives forward. At the same time, I do have to remind myself to step back sometimes from the tasks and think more big picture and strategically about what our priorities are and what we want to achieve.
What are some of the challenges of integration and are there any specific to North America?
The main challenge around ESG integration is that it has become so prevalent, in the sense that everyone is purporting to be doing it. Given the momentum and the structural trends globally from a policy and regulatory standpoint, especially around decarbonisation, but also around addressing social ills, everyone feels pressure to be on this train. But the real challenge of course is that the application of these efforts is very varied. Third party rating agencies are concerned with it too, but are also part of the challenge, given the differences in their measurements. So both for issuers and managers who are trying to hold themselves to a higher standard the challenges are definitely there.
In the US, we have the additional challenge that our investor base is earlier in their journey, so requires on average a lot of additional support and education, and also that their priorities can differ quite markedly across geographies, age groups, political affiliations, and investor types, such that some of the global narratives (for example, all-in on climate all the time, and more fossil fuel exclusions rather than less) do not resonate here. We can’t simply import the same approaches and conversations other regions have used; we have to ensure that we take a client-oriented lens and that we try to meet US investors where they are and show that Sustainability is certainly a broad enough discipline to address their interests as well. We have to be pragmatic about articulating the risks and also the opportunities in the ongoing trends so that clients can see how this benefits them, and we have to do this in a comprehensive way across thought leadership, thematic research, company engagement and product development.
How do you see ESG evolving in investment management?
I see ESG efforts in investment management becoming more nuanced. We are moving to a place where simple integration of ESG characteristics to fully take into account risks and opportunities is becoming expected and table stakes.
From here, the continuum moves to Sustainable investment, where we are actually promoting ESG characteristics and also adjusting the investment universe so that some subset of companies who really are laggards are less likely to be included. This does not mean that we can’t support and finance companies as they evolve and transition, provided that they are willing to do the work to get there, but the bar becomes higher. And beyond that, the continuum moves to more thematic SDG (UN Sustainable Development Goals) investing and Impact investing, where we are trying to achieve specific outcomes alongside financial returns because that is how clients are choosing to express their priorities and values.
For example, in areas like decarbonisation, this will mean movement from simple emissions reduction in a portfolio, to investing in climate mitigation technologies, to potentially actually moving into climate solutions, like natural capital investments and carbon sequestration. Another big shift for the investment management space is in active ownership, on the realisation that we cannot stop the investment process at the point of choosing better positions, but must really focus on how we can enhance those positions once we hold them.
I think the industry recognises that divestment, on the scale needed to meet decarbonisation pledges, is not feasible, and would not allow us to build diversified and robust portfolios, so therefore active influence is the path forward, in terms of supporting investee companies in their own efforts. Finally, as the interest in ESG investing broadens across investor groups that have been more reticent to adopt it, as they await more regulatory “air-cover”, it becomes even more incumbent on investment managers to be those sources of education and standard setting, and to be diligent about keeping the clients’ interests as their top priority.
You were investment director prior to your new role so what made you switch roles?
I was asked! In fact, really all of my role changes at the firm have happened that way, in being asked to take something on. I am lucky to have sponsors and mentors who know my strengths as well as my weaknesses and have listened to me when I articulate what I enjoy or don’t enjoy doing, and have been able to line me up with roles that have suited me but also have allowed me to benefit the firm.
The good news, in this instance, is that the investment director role, which also sits between an investment function on one side, and distribution and external clients on the other, and manages a piece of a business, is very similar to what I do now. And the prior roles that I had were functionally very similar too, so there has been a lot of consistency to my roles. I have always represented, in the US, teams and resources that are predominantly in London, so I have always had a lot of autonomy to build here in the US, which definitely suits me.
What has been your career progression?
I started my career in consulting pre-MBA, and then moved into investment banking post-MBA, and from there to asset management. What has been really consistent is that each of my roles has required me to be a translator of complex ideas, from principals in consulting, technical experts in banking, and investors in asset management, to all of their end clients. There is a skill set in being able to speak between disparate constituencies in such a way that both can trust that you understand them, can represent them, and have their interests at heart. And so while I have moved between industries and effectively reinvented my career several times, there has always been that common thread to which I can anchor.
What made you stay at Schroders for 12 years?
Candidly, I have stayed because the roles have kept changing, so I have always been able to feel excited about taking on new challenges. There has been opportunity for upward progression in a way that has felt authentic to my interests and strengths and I have had a strong network of support both from senior managers and direct supervisors and peers. The culture and people at Schroders are really easy to like, and really hard to imagine leaving behind. The firm has the right priorities about serving the clients and growing the business with both innovation but also measure and patience. That ability to feel like your interests are aligned with what is best for your clients alongside having the space to think long term, is very fertile ground for wanting to keep contributing to the journey.
Is the career you envisioned? If not what had been the plan?
No, not really, but only in the sense that I couldn’t have known that this path even existed. I was born in the Soviet Union (in Kiev, Ukraine) and emigrated to the US as a child with my family. My parents and grandparents are/were all highly educated professionals but finance the way we have it here was not a reality in a Communist country, so they went into the likes of medicine and engineering.
I did go to the college with the intention of continuing to law school, and even worked at a law firm, but there were important mentors in my life and certain unexpected opportunities that led me first to consulting and then on to finance. I definitely ended up in the right spot, and I feel quite lucky to be able to enjoy what I do and to use my strengths in my role.
How have things changed in terms of diversity and career progression since you started working? Did you face any challenges?
Things are definitely quite different than when I started working. That isn’t to say that I had too many challenges, certainly not very overtly. I feel I benefited from being a woman in male dominated spaces, like my MBA program and both consulting and finance. People wanted to see diversity and they created opportunities for me as a result.
I also have always had many more male mentors and sponsors, just because there haven’t been a lot of women ahead of me on those paths, and so I have really benefited from the guidance of male colleagues who took the time to further my career. I will say that I have always taken a very authentic approach, I’m quite forthright and don’t have much of a poker face, so people have to accept me as I am, or not. I have been inclined to compete toe to toe with male peers. I have also focused on cultivating a more connected and relationship-oriented approach, more collaborative, which was really important as I got more senior. I think some of the biggest challenges probably were during my childbearing years, though Schroders was immensely supportive. The firm promoted me and tried to accommodate me as best they could during those times.
What further progress needs to be made?
I think the biggest thing the industry needs to do is to build diversity earlier into our talent pipeline. To connect with women and racially diverse students when they are still in high school or early on in college, and show them what the industry is like and how it can suit them. And when we do bring in diverse talent, we need to support them so that they feel they can bring their authentic self to work and not have to fit into more traditional moulds.
How does Schroders support and foster success with respect to Diversity and Inclusion?
Schroders has been on a journey in the 12 years I have been here, in terms of recruiting and supporting diverse talent, allowing people to be their genuine selves at work, creating employee resource groups to allow people to connect and to learn from one another.
Schroders has been very willing to be transparent (for example, showing our gender pay gaps in order to set aggressive goals around closing them), to lead the way (e.g., implementing a flexible working policy on a permanent basis), and to do the right thing (e.g., committing to no layoffs during the covid pandemic and lockdowns).
It is in times of adversity that you see an organisation’s true colors and values, and it has been very clear in recent years especially how authentic Schroders’ commitment is to DEI and to all of its employees, which is why the very vast majority of Schroders employees will that they are proud to be associated with the firm. We are certainly on the right path.
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