Guernsey has a role in creating a sustainable world and stronger society

It’s the first conference day at SuperReturn International Berlin and I’ve been fortunate to attend some more very interesting panel discussions.

One of which was Wednesday's State of the Union address which featured speakers Jan Stahlberg, Founder, Managing Partner Trill Impact, Gabriel Caillaux, Co-president, Managing Director and Head of EMEA ,General Atlantic, Philippe Freise, Partner, Co-Head of European Private Equity, KKR and Dr Karim El Solh, Co-founder and CEO, Gulf Capital.

They talked about which firms have weathered the Covid-19 storm, the role of PE in regenerating and predictions for 2022.

They agreed that we’re currently experiencing an explosion of investment opportunities and that we are living in an exceptional period of value creation, with innovation in the digital industry currently booming. There was a consensus that opportunities to generate growth have never been better if you are backing the right themes, particularly with regard to ESG and sustainable investing.

I particularly enjoyed seeing their assessment of what might be on the horizon with regard to risks to look out for in 2022. Rising inflation was cited, with panelists predicting that we need to plan for a world with higher inflation. There were warnings about over reliance on leveraging and over-capitalisation with one panelist reminding conference lessons from the past, learning the hard way that using a lot of leverage to generate returns is ‘not the right way’.

Of course, the biggest risk we face in future is the effect of climate change. This feels like a particularly pertinent discussion with SuperReturn taking place at the same time as the COP26 Climate Summit. Panelists agreed that ESG should be integrated into every stage of the process, with technology seen as a key driver for building back better.

I hadn’t planned to single anyone out, but I was especially struck with what Jan had to say when he opined that the PE industry can take action now, and will receive both political and regulatory support to do so. Industry already has the necessary tools to create change in this direction and it can be a great business opportunity, as well as creating a sustainable planet and stronger society.

Listening to this as a representative at SuperReturn International of WE ARE GUERNSEY, where we have been telling the story of Guernsey’s leadership in the green and sustainable space, it’s made me feel incredibly optimistic. Guernsey is proud to be a member of the United Nations Financial Centres for Sustainability (UN FC4S) and has is a genuine innovator in this space,. For example, the world’s first regulated green fund regime was launched in Guernsey in 2018 and now channels £4 billion into climate-related projects. In addition, it was Guernsey innovation that resulted in the creation of the world’s first catastrophe bond that uses blockchain to deliver humanitarian aid in the event of a volcanic eruption.

It’s been heartening to see the announcement from Mark Carney that there is £130 trillion committed to the decarbonization of the economy. This capital needs a home and experienced finance professionals to see that it gets to where it is needed. Guernsey, with its five decades of experience in specialist financial services, can certainly fulfil this role as an enabler for cross-border capital flows.