On how sustainability intersects with business imperatives, Teo cites an example of why Fullerton invested in a green hydrogen company that offers the product at cost parity. “What’s interesting is that the pitch the company has for industrial customers is not buy my green hydrogen because it’s green is good for your reporting, but buy my green hydrogen because it’s the same as what you’re buying grey, and I’m giving you more reliable, better quality hydrogen,” he adds. “Now that narrative sits very well with customers, sits very well with stakeholders, sits very well with your shareholders.”
Businesses exist to make money, and sustainability is critical to assessing how companies generate profits and create shareholder value. This was the view of a panel of professional investors at the inaugural SGX Group-Gprnt Climate Action Forum held on July 2 at Shenton Way.
Fullerton Fund Management managing director Mervin Teo believes that profitability and sustainability can be mutually reinforcing. When evaluating companies to invest in, the fund manager asks questions on how sustainability creates business opportunities, lowers costs or enhances resilience. “What we’re trying to build is where profitability drives sustainability in the business, and likewise, sustainability drives profitability,” he adds.
