Lombard Odier partnership on Sustainable Investment

Lombard Odier and Oxford University: a roadmap to sustainability

Video transcript

Dr Ben Caldecott, Lombard Odier Associate Professor of Sustainable Finance, University of Oxford: It's impossible to tackle the global environmental challenges we face without shifting capital flows in the financial system away from things that are harming the environment.

Hubert Keller, Senior Managing Partners at Lombard Odier Group: We need to understand how industries will be able to address and solve some of these environmental problems that they face.

Sir Martin Smith, Founding Benefactor, Smith School of Enterprise & the Environment: People are recognising increasingly that the capitalist system hasn't taken account of a lot of the costs, many of which are rather negative.

Dr Michael Urban, Deputy Head of Sustainable Investment Research, Lombard Odier Investment Managers: We are at the cusp of an accelerating transition in the real economy when it comes to sustainability and that transition has major impact for risks as well as returns for investors.

Dr Ben Caldecott: So at the Oxford Sustainable Finance Programme one of the key things we have to do is to create world-leading research.

A pressing need to have scientific framework to inform practice. Roadmaps that industries need to follow to address their respective sustainability issues. To define best practice to define the future of sustainable finance and investment but we're also trying to translate that into real world practice.

Hubert Keller: So we're very excited with this very special collaboration between Lombard Odier and the University of Oxford.

Dr Ben Caldecott: This new partnership with Lombard Odier that's centred on endowing the first ever Professorship of Sustainable Finance at any university, anywhere in the world.

Hubert Keller: The collaboration with oxford is very important they will help us to establish and determine these industry roadmaps, across all the regions in which we invest.

Dr Ben Caldecott: And it means that we can also learn a lot understanding the challenges they face can enhance the research that we're undertaking. One of the really exciting parts of this partnership is the connection with Oriel College. Oriel has one of the biggest groups of environment climate change researchers across the University of Oxford and so it's this wonderful synergy between the department, the college, and the wider university.

Sir Martin Smith: I’m absolutely thrilled that this is happening. Lombard Odier are so well known, the whole nature of the relationship between environmental problems and the financial world. They couldn't be a better partner.

The partnership

Lombard Odier and the University of Oxford have launched a new multi-year partnership to foster research and teaching on sustainable finance and investment, with a particular focus on climate change, circular economy and nature.

The multi-year partnership will create the first endowed professorship of sustainable finance at any major global research university. The post will be hosted in the Smith School of Enterprise and Environment at the School of Geography and the Environment.

The collaboration between Oxford University, one of the oldest centres of higher education, and Lombard Odier, an outspoken leader in the field of sustainable investing, will provide a unique platform for knowledge exchange between scholarship and financial services, support sustainable finance in becoming a major field of academic research globally, and harness the vast potential of the financial sector to drive environmental, social and economic transformation.

A key element of the partnership is the creation of the first endowed senior academic post in sustainable finance at any major global research university. Dr Ben Caldecott has been appointed the first holder of the post and will become the Lombard Odier Associate Professor and Senior Research Fellow of Sustainable Finance at the University of Oxford, based at the Smith School of Enterprise and the Environment within the School of Geography and the Environment.

Lombard Odier will work with Oxford University's scholars to integrate the University's pioneering work into their own proprietary research and investment solutions, while Oxford will establish a programme for the ongoing training of Lombard Odier investment professionals, while Oxford scholars will benefit from accessing Lombard Odier's research and product innovation. The two institutions will also host a joint annual research forum, open to the wider academic and practitioner community.

Hubert Keller, Managing Partner at Lombard Odier, said, "There are unprecedented investment opportunities associated with the global sustainability transition - towards a Circular, Lean, Inclusive and Clean Economy. We call this the "CLIC Economy" and as a firm, we are at the very forefront of identifying and capturing these opportunities.

"Sustainability has always been at the heart of Lombard Odier's approach to its business and investment philosophy and we are consistently investing in these capabilities. Through their unique and leading capabilities in sustainable finance, we are excited to be working with the University of Oxford with the objective to increase the impact of sustainable investments."

Professor Dame Sarah Whatmore FBA, Head of the Social Sciences Division, University of Oxford, said, "This timely partnership with Lombard Odier will help to ensure the University of Oxford can scale its pioneering multidisciplinary research on sustainable finance. Our researchers have significant analytical insights to bring to bear on this profoundly important set of issues and this unique collaboration will enhance their ability to do so over the long-term."

Endowment and appointment of first Lombard Odier professorship

Dr Ben Caldecott, a distinguished expert in sustainable finance and investment who is the founding Director of the Oxford Sustainable Finance Programme and the COP26 Strategy Advisor for Finance at the UK Cabinet Office, has been appointed the first holder of the post and will become the Lombard Odier Associate Professor and Senior Research Fellow of Sustainable Finance at the University of Oxford.

The post will be based in the Smith School of Enterprise and the Environment within Oxford's School of Geography and the Environment and connected to Oriel College, Oxford.

Dr Caldecott, who will also lead the partnership, said, "Sustainable finance is a structural change in both the demand and provision of financial products and services. It is also mission critical for tackling the massive environmental and social challenges facing humanity.

"But for sustainable finance to be itself sustainable, it needs greater academic rigour, as well as pedagogy to scale the adoption of best practice. This is a huge agenda for both practitioners and researchers, and as the Lombard Odier endowment implies, these questions and issues will endure in some form for many generations. There are also many very immediate questions, such as how to ensure investor portfolios are aligned with climate outcomes, that we'll seek to answer much more quickly over the coming months and years."

Neil Mendoza, Provost of Oriel College, Oxford, said, "We're delighted to be part of this broader Oxford collaboration and for Lombard Odier's generosity and support. Across the physical and social sciences Oriel has one of the largest clusters of academic researchers in Oxford working on sustainability challenges. Understanding how environmental change influences investment and vice versa is essential and will add a significant capability to the Oriel Environmental Change Group. This donation will help Oriel be a focal point for what we believe is an essential area of research with a potential for high impact."

Professor Cameron Hepburn, Director of the Smith School of Enterprise and the Environment, said, "Sustainable finance, business and enterprise are crucial to achieving net-zero emissions, a green recovery from Covid-19, and a cleaner, fairer and more prosperous world. We are delighted to partner with Lombard Odier on this world-leading initiative, which comes at a pivotal moment for global environmental and economic efforts."

Dr Christopher Kaminker, Head of Sustainable Investment Research, Strategy & Stewardship at Lombard Odier, said, "As investors it is our obligation to ensure that we are as informed as possible about the myriad sustainability dynamics that underpin risk and return considerations. These dynamics, including the interlinked transitions to net-zero emissions, a circular economy and regenerative nature are already material to our investment processes and are set to accelerate dramatically in the years ahead. Through supporting research into these critical areas we endeavour to contribute to advancing the research agenda for the public benefit while also enhancing our own investment capabilities for our clients."