Hedge fund manager Paul Tudor Jones’s comment that “capitalism may need modernizing” may have made headlines, but it was taken out of context. More specifically, the tenet that sustainable investment is a new concept is false.
Jones was talking about the genesis of his new JUST exchange traded fund (ETF) in an interview. The ETF is a product that ranks companies according to aspects of good corporate behavior, such as the environmental impact of their supply chain, worker treatment and benefits, and diversity in management and governance.
Jones said “he had never heard” of the environmental, social, and governance industry or ESG for short, which totals $3 trillion in value. Indeed, this industry has expanded significantly since 2012, when the reputable hedge fund manager began exploring the JUST ETF concept. However, the world into which he has launched his ETF was not built over the past six years, but over more than 60 years.
It’s important to realize that the movement of sustainable, responsible and impact investing (SRI) provides critical grounds for where we stand in modern history. The sustainable investing movement is, sadly, being questioned as a trend or luxury in times of a relatively strong economy.
On the plus side, it is gaining popularity and visibility with the launch of products like Jones’ JUST ETF and the TPG Rise Fund, which are becoming increasingly common.