Meet the Managers - Australia Sustainable Equity

Will

I grew up on a farm in Victoria, Southeastern Australia, and that upbringing has deeply influenced me. I started in the industry in 1985 as a trainee investment analyst at National Mutual Life Association. Over the years, I’ve held various roles in stockbroking, including stints in London, New York, and Asia.

I joined MCA over 12 years ago to reconnect with my roots in asset management. Initially, I was in a client-focused role, which gradually evolved into portfolio management.

Several years ago, our firm adopted the motto “Investing to Improve Lives.” Within our team, we started to discuss how we could have a greater purpose than just managing money, and this resonated with me and helped to drive the establishment of the Sustainable Equity strategy. And now, I’m the Co-Portfolio Manager for the strategy.

Naomi

I joined MCA’s predecessor firm 18 years ago as a graduate with a background in quantitative research. I was drawn to MCA because of the flat structure, which allowed junior members, like me at the time, to contribute meaningfully and learn directly from seasoned professionals like Reece Birtles (MCA’s Chief Investment Officer (CIO)) and Michael Slack (Head of Australian Equity Research).

Sustainability has always been a passion of mine, rooted in my love for the outdoors and hiking. My role evolved from focusing on risk control to developing sustainability frameworks that balance financial returns with societal benefits. The chance to further grow my skill set, become Co-Portfolio Manager in 2020, and invest in companies that were on a sustainable pathway, was an exciting evolution in my career.

Naomi

My initial role involved researching and back testing how best to integrate our longstanding Valuation, Direction, Quality research with our proprietary Sustainability insights with Sam Li (Portfolio Manager). We wanted to build a portfolio that balanced sustainability and financial outcomes, while also running a high-conviction strategy. Working closely with Will, Reece, and Sam, we combined our diverse backgrounds to bring this portfolio to life.

I enjoy working with my colleagues to continually improve our investment process. I’m also focused on expanding and refining our sustainability frameworks, covering topics like shadow carbon costs, modern slavery, and natural capital.

Will

When I started 40 years ago, sustainability wasn’t even a concept. Back then, shareholder return was the sole focus. But steadily, and even more so since the Banking Royal Commission¹, there’s been a shift towards considering both financial returns and non-financial impacts on various stakeholders.

I’m pleased to see a growing focus on issues like employee safety, First Nations, environmental impacts, and climate change. I believe companies, not just governments, need to do the heavy lifting on sustainability in a way that benefits all stakeholders.

Ongoing communication between stakeholders is going to be key to reduce friction. For example, communities need to be involved in the development of wind farms, transmission needs to keep up with solar generation, and governments need to consider the impact on society’s standards of living in shutting down fossil fuels too quickly.

As investors, it’s our duty to raise these issues during our engagements with companies.

Will

I enjoy engaging with boards, management, heads of sustainability and employees across companies. Unlike quantitative-only and passive funds, our analysts are responsible for taking an active role in ownership. As portfolio managers, our additional involvement in engagement is a great opportunity which provides valuable insights to the impact of investment and sustainability themes across many companies.

Working with colleagues who have different skill sets, like Naomi, has been a huge opportunity for me, and I really enjoy working with her. Her quantitative background complements my passion for stocks, helping us maintain overall risk control.

Naomi

Given my quant background, I tend to respond more to incremental changes in proven quantitative signals and I’m more comfortable reflecting this in our position sizing than my fundamental colleagues.

Although we have a disciplined process, I think it’s important that our portfolio decisions are made fundamentally by Will and myself drawing on our complementary insights and experience.

Will

People often don’t consider what goes into making the next sustainable product. Australia plays a crucial role in supplying materials like lithium, copper, and aluminium, which are vital for the energy transition. People often overlook the source of these materials, but Australia is a significant supplier.

Naomi

Australia also has great companies offering low carbon solutions, such as Worley, a company that traditionally serviced oil and gas companies and who now provide sustainable solutions to customers like CCUS, hydrogen, and low carbon fuels. It’s a prime example of the undervalued, sustainability-driven stocks we seek for this portfolio. Additionally, Australia’s healthcare system is world-class, with companies like Medibank and CSL leading the way in innovation and improving patient outcomes.

Will

In my spare time, I’m a light airplane pilot, and seeing Australia from above gives you a unique perspective on the country’s natural beauty and the growing risks to it, like biodiversity loss. This experience motivates me to invest in a more sustainable future.

Naomi

I love adventure travel, particularly hiking. It gives me time to reflect, and I’ve witnessed the effects of climate change firsthand in places like the glaciers of the French Alps which are melting at an incredibly rapid rate.

These experiences have deepened my commitment to sustainable investing, with the hope that future generations can also enjoy these natural wonders.