ANNUAL REVIEW FOR 2019 IN PERSPECTIVE - Quilter Cheviot
←
→
Page content transcription
If your browser does not render page correctly, please read the page content below
ANNUAL REVIEW FOR CHARITIES 2019
ANNUAL REVIEW FOR
CHARITIES
201 9 I N P E RS P ECTIVE
1
ANNUAL REVIEW FOR CHARITIES 2019
W O R K I N G W I T H YO U
If you would like to speak to one of our charity specialists, contact us on:
t: +44 (0)20 7150 4200 e: charities@quiltercheviot.com w: www.quiltercheviot.com
quiltercheviot.com
2
ANNUAL REVIEW FOR CHARITIES 2019
INTRODUCTION
Welcome to our fifth annual review. Once again we have curated articles
and information on a diverse range of subjects, all focused on the charity
sector. As ever, thanks to our contributors for their insights.
Enjoy your reading!
WILLIAM REID
HEAD OF CHARITIES
3
ANNUAL REVIEW FOR CHARITIES 2019
EDITOR’S NOTES
We are, as ever, very grateful to those who have contributed:
• Martin Bisp, Empire Fighting Chance
• Elizabeth Chamberlain, NCVO
• Ivan Cooper, The Wheel
• Lesley Dickie, Durrell Wildlife Conservation Trust
• James Evans, Tozers Solicitors LLP
• Pesh Framjee, Crowe LLP
• Ian Hempseed, Hempsons
• Carly Jones, SIFA Fireside
• Kirsty McEwan, Higgs & Sons
• James Saunders, Moore Kingston Smith
• Lexi Shore, A C Mole & Sons
• Robin Thomas, Morgen Thomas Ltd
• Emma Wilder, Beyond Profit
Thank you to those charity Trustees and Officers who completed our questionnaire at charity conferences over
the year. Thanks also to my colleagues Sheena Berry, Liz Dhillon, Howard Jenner, Greg Kearney, Suneet Kumar,
Eoin McBennett, Alan McIntosh and William Reid for their contributions and, particularly, to Violet Hayden for
her work in co-ordinating this as well as Seb Scott and Ricardo Oliveira for sense-checking.
If you have any feedback, please contact us at: charities@quiltercheviot.com
GEMMA WOODWARD
EXECUTIVE DIRECTOR AND DIRECTOR OF RESPONSIBLE INVESTMENT
4
ANNUAL REVIEW FOR CHARITIES 2019
CONTENTS
Questions of the year 2019 6
Questions of the year 2020 7
Events calendar 2020 8
Working with the sector 10
Investment 11
Globalisation: from policy to portfolio
Ingenious: why your genes are the future of medicine
Can we overcome emotion when investing?
Review of responsible investment 2019 and a look ahead to 2020
Big oil and climate change: engage or divest?
Outlook 2020: a familiar quandary
Q&A with the investment team of the Quilter Cheviot Global Income and Growth Fund for Charities
Finance, legal and regulation 32
Collaborations and mergers for sustainability and impact
Time for charities to diversify their income
In conversation with the charity sector
Governance matters – getting the balance right
“Closing the gap” - addressing diversity on boards of Trustees
Charity stories 48
The story behind Empire Fighting Chance
Going wild for gorillas
Improving health and inclusion for homeless people in Birmingham
Growing positivity about Ireland’s community, voluntary and charity sector’s future
The Brain Charity and dementia: a new musical legacy for Liverpool?
Volunteering and the sector
The sector: now and in the future 67
Supporting Ireland’s not-for-profit sector
Four key trends in fundraising
A review of the past twelve months for charities, and what’s in store for the future
What will the next ten years hold for the charity sector?
Charity sector at a glance
trustEnews 83
Testimonials 85
Charity guides 86
The Quilter Cheviot Global Income and Growth Fund for Charities 87
5
ANNUAL REVIEW FOR CHARITIES 2019
QUESTIONS OF THE YEAR
(2019)
In total, 249 people answered the following questions at conferences, these were the results:
How do you think Brexit will affect the charity sector?
In a positive way - 11% Unsurprisingly, nearly 90% of
respondents are concerned
In a negative way - 89%
about Brexit affecting the
sector in a negative way.
Do you consider ESG (environmental, social and governance)
factors when it comes to your investment portfolio?
Yes - 78% Nearly 80% of respondents
No - 22% consider ESG factors in their
investment portfolio.
When considering which companies and organisations to invest in, charities are
increasingly taking into account such factors as impact on climate, employment
practices, sustainability, human rights, community impact, executive compensation
and board accountability.”
CC14 Charities and investment matters: a guide for Trustees
For more information on our approach to responsible investment, please visit our website: https://www.
quiltercheviot.com/uk/charities/why-quilter-cheviot/responsible-business/responsible-business-for-
investment/
6
ANNUAL REVIEW FOR CHARITIES 2019
QUESTIONS OF THE YEAR
(2020)
Looking ahead, these are the questions we will be posing to charity Trustees and Officers:
Do you have a clear reserves policy?
Yes?
No?
Do you think your charity has considered how climate change might affect its work?
Yes?
No?
7
ANNUAL REVIEW FOR CHARITIES 2019
CHARITY EVENTS
C A L E N DA R ( 2 0 2 0 )
CHARITY SEMINARS
This year’s series of seminars focuses on the ever changing environment for charities. We will be
joined by Sir Stuart Etherington, former Chief Executive, NCVO and Jonathan Hill, Financial and
Commercial Director, Rowcroft Hospice, to talk about the challenges charities are facing and the
success story of Rowcroft Hospice. From an investment perspective, we will look at responsible
investment and what this means when making investment decisions.
Location Date
Dublin* 22 April 2020
Bristol 8 October 2020
London 13 October 2020
Birmingham & Leicester 21 October 2020
Liverpool & Manchester 22 October 2020
Edinburgh* 27 October 2020
*Edinburgh and Dublin speakers to be confirmed
8ANNUAL REVIEW FOR CHARITIES 2019
CHARITY ROUNDTABLES
This is an opportunity for you to join other charity Trustees and staff for a lively debate and lunch.
Roundtable on governance and the changing
Roundtable on ‘to divest or to engage?’
regulatory landscape
Location Date Location Date
Belfast 26 March 2020 Leicester 3 June 2020
London 13 May 2020
Bristol 14 May 2020 Roundtable on diversity on boards and
diversification in investment portfolios
Liverpool 18 June 2020
Location Date
Glasgow 28 October 2020 Birmingham 7 July 2020
Salisbury 10 November 2020
Roundtable on the political climate and the effect
on charities in Scotland
Roundtable on what are reserves for? Location Date
Location Date Edinburgh 16 September 2020
Birmingham 30 April 2020
Manchester 9 June 2020 Roundtable on effective financial management –
essential guide
Leicester 8 September 2020
Location Date
London 5 November 2020 Belfast 17 September 2020
Roundtable on building a sustainable future
through fundraising
Location Date
Edinburgh 18 March 2020
Glasgow 19 March 2020
Salisbury 24 June 2020
Liverpool 10 September 2020
Bristol 12 November 2020
Birmingham 17 November 2020
Manchester 26 November 2020
TO BOOK A PLACE AT ONE OF OUR EVENTS PLEASE EMAIL: charities@quiltercheviot.com
quiltercheviot.com
9ANNUAL REVIEW FOR CHARITIES 2019
WO R K I N G W I T H
THE SECTOR
2019 attendance statistics:
In 2019, we provided training for:
Making
1129
people at events for
88
HOURS
99,352
hours of
TRAINING
2018 attendance statistics:
In 2018, we provided training for:
Making
1088 events for
people at
80 87,040
hours of HOURS
TRAINING
10ANNUAL REVIEW FOR CHARITIES 2019
INVESTMENTS
Contributors:
Sheena Berry Equity Research Analyst Quilter Cheviot
Sheena joined Quilter Cheviot in 2018. Prior to joining the business, she was a Life Sciences analyst at
N+1 Singer. Sheena graduated from Edinburgh University with a degree in Mathematics and Boston
University with a Master’s degree in Financial Economics. She is a Chartered Financial Analyst (CFA)
charter holder. Her role is to analyse stocks within the healthcare sector.
Liz Dhillon Equity Research Analyst Quilter Cheviot
Liz began her career in the City in 1982 working as a sector specialist in mining equities for major
securities houses advising institutional clients. She joined Quilter Cheviot in 1995 where she has covered
a number of sectors, but continues to specialise in global mining and oil equities and is a member of the
UK and International Stock Selection Committees. After gaining a degree in Environmental Sciences
(Geophysics and Geochemistry), Liz worked in oil exploration before completing a Masters in Mining
Geology and Mineral Exploration. She is a Chartered Fellow of the Chartered Institute for Securities and
Investment.
Howard Jenner Executive Director Quilter Cheviot
Howard studied English and Psychology at Southampton University before joining Laing & Cruickshank
in 2001, which was acquired by UBS in 2004. In 2006, Howard moved with the majority of his former
colleagues to Cheviot Investment Management, which subsequently merged with Quilter. Howard is the
co-lead manager of the Quilter Cheviot Global Income and Growth Fund for Charities. He is a Chartered
Fellow of the Chartered Institute of Securities and Investment (CISI) and chairs the Charity Asset
Allocation Sub-Committee. Howard is a member of the international equity, alternatives and fixed
interest committees. Amongst his charitable commitments, Howard is a member of the Royal College of
Arts’ investment committee.
Greg Kearney Responsible Investment Analyst Quilter Cheviot
Greg joined Quilter Cheviot in 2019 from the UN-supported Principles for Responsible Investment. Prior
to this, he worked in the fund research team at Cambridge Associates. His role is to ensure we act as
stewards of our clients’ assets in order to protect and enhance long-term returns. Greg engages with
companies and funds to better understand how they assess environmental, social and governance risks
(as well as opportunities). He graduated from the University of York with a Master’s degree in
International Political Economy.
Suneet Kumar Investment Manager Quilter Cheviot
Prior to joining Quilter Cheviot, Suneet was a founding member of the Private Client team at Seven
Investment Management. He has also worked at Barclays Wealth & Investment Management and HSBC
Global Asset Management. Suneet graduated from Lancaster University with a degree in Law and
completed the Legal Practice Course at the University of Law. He is a Chartered Fellow of the Chartered
Institute for Securities and Investment. Suneet’s primary responsibility is the management of portfolios
on behalf of charities, individuals, trusts and pensions.
Alan McIntosh Chief Investment Strategist Quilter Cheviot
Alan became the company’s Chief Investment Strategist on the merger of Quilter and Cheviot and is
responsible for our global equity strategy. He chairs the UK and international stock selection
committees and is a member of the asset allocation and fund selection committees. Prior to Quilter
Cheviot, Alan was a founding partner of Cheviot Asset Management where he was chief investment
officer. Previously he worked for Laing & Cruikshank Investment Management and Credit Suisse Asset
Management as a senior strategist. This followed on from a 12-year career as an institutional fund
manager. Alan graduated with an Honours degree in economics from Heriot-Watt University.
11ANNUAL REVIEW FOR CHARITIES 2019
William Reid Head of Charities Quilter Cheviot
William has been managing charitable portfolios since 2003. Prior to his City career, William spent a
decade working in the Royal Navy, including seven years in the Submarine Service. His City career
began in 2002 at Laing & Cruickshank, then UBS, before joining Cheviot as a partner in 2006. The
Company merged with Quilter in 2013, at which time he was promoted to Head of Charities. William sits
on the Investment Oversight Committee and Charity Asset Allocation Group. He holds a BA in
Economics and is a Chartered Fellow of the Chartered Institute of Securities and Investment (CISI).
Amongst his charitable commitments, William is a governor of the Royal Star & Garter, Trustee of
Seafarers UK and acts as the independent investment adviser to the Royal Navy and Royal Marine
Charity (RNRMC). Historically, he has also acted as a school governor. In addition, he is a Fellow of the
Royal Society of the Arts.
Gemma Woodward Executive Director and Director of Responsible Investment Quilter Cheviot
Gemma joined Quilter Cheviot in 2015. She is responsible for managing charity portfolios as well as
developing the company-wide approach to responsible investment and the faith-based investment
offering. Gemma is the co-lead manager of the Quilter Cheviot Global Income and Growth Fund for
Charities. She has over twenty years' industry experience and has spent the majority of that time
focused on the charity sector and specifically clients with complex ethical and socially responsible
investment requirements. Gemma started her career at Lloyds Bank and joined Newton in 2002
following the acquisition of the Henderson private client and charity business; and latterly was at
Kleinwort Benson. She graduated from Durham University with a degree in history in 1994 and is a
Chartered Fellow of the CISI as well as holding the Chartered Wealth Manager designation. Gemma is a
governor of Rugby School and a Trustee of The Book Trade Charity (BTBS); additionally, she is an
independent investment advisor to the University of Birmingham’s investment committee.
In this section:
• Globalisation: from policy to portfolio
• Ingenious: why your genes are the future of medicine
• Can we overcome emotion when investing?
• Review of responsible investment 2019 and a look ahead to 2020
• Big oil and climate change: engage or divest?
• Outlook 2020: a familiar quandary
• Q&A with the investment team of the Quilter Cheviot Global Income and Growth Fund for
Charities
12ANNUAL REVIEW FOR CHARITIES 2019
G L O B A L I S AT I O N : F R O M
POLICY TO PORTFOLIO
William Reid, Quilter Cheviot
How has charity investing changed over the past 20 Perhaps less well known is the extent to which charities
years? have diversified their equity allocation. While the
amount invested overall in equities has remained the
Twenty years ago the film ‘Saving Private Ryan’ was
same, the allocation to North America has more than
released. It seems strange to think it was that long ago,
quintupled, with Japan and other Asian markets also
perhaps especially when we commemorated the 75th
seeing sizeable increases. The percentage allocated to
anniversary of D-Day last year. It is difficult to imagine
the UK, meanwhile, has halved, going from 84% to 40%.
the scale of change since then; indeed, it is virtually
impossible to comprehend.
Charts 1 and 2: The US is the winner from charity
We do not need to look back 75 years to see dramatic diversification
changes however. The world has changed significantly
over just the past 20 years, including in my own area,
charity investment. Charities are operating under UK - 84%
a radically different investment landscape today, US - 5%
with low interest rates, lacklustre global growth, and Europe - 7%
populism on the march. Japan - 1%
Asia (ex Japan) - 1%
Emerging markets - 2%
Charities ring the changes Global - 0%
As you might expect, charity portfolios have evolved
to reflect the impact of these changes over the past
20 years. Charity asset allocation to fixed interest 31 December 1998
investments fell from 27% to 11% between 1998 and
2018, while investments in alternative assets now
account for 11%. The fall in interest rates and risk- UK - 40%
free returns can be directly linked to this shift, with US - 26%
many charities seeking exposure to real assets like Europe - 15%
infrastructure, property and renewable energy to Japan - 4%
support income distributions. Asia (ex Japan) - 6%
Emerging markets - 4%
Global - 5%
31 December 2018
Source: WM, State Street, Teknometry
27% This shift away from the UK reflects a number
11% of factors, including an awareness of the sector
concentrations evident in the UK stock market. To gain
1998 2018 effective exposure to sectors such as technology, you
(Charity allocation to fixed interest fell)
13ANNUAL REVIEW FOR CHARITIES 2019
have to invest globally. Whereas technology accounts The ageing population in the developed world
for more than 15% of the FTSE World index, it accounts – eventually including the US – and high global
for less than 1% of the FTSE All-Share index. indebtedness are effectively acting as a millstone on
global interest rates. Alternative assets that provide
an income could become even more popular. If self-
driving cars ever take off, that could mean investing
in things like giant taxi fleets operated by Uber. While
15%
Uber might not want the dirty work of running and
1% maintaining its own taxis, leasing vast autonomous
taxi fleets could offer a reasonable income stream for
investors.
of the FTSE of the FTSE Other trends, such as the fall in the number of
World index All-Share index investable companies, are more uncertain. In 1997, you
could pick any one of 7,600 US companies to invest
In previous years, investors would gain global exposure in, whereas that number stands at just 3,700 today.
through conglomerates, such as Hanson Trust, a British Indices, structured as funds, have become far more
based international building materials company. The popular as investment products, with the number
(technology accounts for more than)
shift away from conglomerates has reflected investor of indices now in excess of 2.96m. Indices seem
confidence in making their own decisions in finding the unlikely to fade in popularity, and while low interest
most attractive global opportunities. It has also been rates encourage companies to issue debt rather than
possible to invest overseas and still enjoy attractive raise shares, logic dictates that the number of listed
dividend returns over many time frames, enjoying companies can’t go on falling forever.
enhanced total returns compared to the UK market.
Conclusion
How will things change in the future? As the novelist L. P. Hartley commented, ‘the past is
Some trends – like the rise of China – will continue to a foreign country; they do things differently there.’
demand greater allocations, despite President Trump’s Perhaps investors will look back at our own allocations
best efforts. China contributed just over a quarter of today and think it incredible that, even now, Chinese
global GDP growth in 2018, and this percentage is equities are not listed as a distinct category for
expected to rise over the next five years.1 India is also investment and sit instead within emerging markets.
expected to become increasingly important, especially We may also see some of the changes charities have
when its population is forecast to keep growing made, such as the move away from bonds, as being
through to the 2060s.2 Whilst the US will continue to prescient. Regardless of future shifts within charity
dominate in the short term, its influence will reduce if it portfolios, I am sure one adage will stand the test of
turns its focus inwards. time: investment managers will continue to tell their
charity clients to diversify!
In the current environment, it also seems likely that
charities will continue to move away from fixed income
investing.
2018
1 https://www.bloomberg.com/news/articles/2018-10-28/where-will-global-gdp-growth-come-from-in-the-next-five-years
2 https://ourworldindata.org/indias-population-growth-will-come-to-an-end
(China contributed just over a quarter of global GDP )
14ANNUAL REVIEW FOR CHARITIES 2019
I N G E N I O U S : W H Y YO U R
GENES ARE THE FUTURE
OF MEDICINE
Sheena Berry, Quilter Cheviot
Over the past fifty years, we have become used to the idea of mass healthcare. Cold as it may seem, our
health system is built on an industrial scale, with everything from heart disease to cancer treated using
largely ‘one size fits all’ procedures.
Is the industrial model of healthcare the future While cell and gene therapy technologies are still at
though? There are good reasons to think not. an early stage, there has been some success, with
Advances in medicine and our understanding of the US approving the first cell/gene therapy back in
genes are leading us to a new era of personalised 20172 for a form of blood cancer.
medicine, one where the treatment we receive will
be based on our own genetic make-up. These
advances unlock two exciting areas; first, the ability Cell and gene therapies are now becoming more
to cure genetic conditions, and second, medicines feasible
individually tailored to cure diseases like cancer. Treatments like cell and gene therapy build on
Medical scientists are now concentrating their focus almost a century’s worth of science, including that of
in one of two areas – cell therapy and/or gene Francis Crick, James Watson and Frederick Sanger.
therapy. Cell therapies are designed to improve the While Crick and Watson discovered the structure of
immune system’s ability to fight diseases such as DNA, Sanger was the first to establish techniques to
cancer. They involve collecting cells from a patient’s sequence and map genomes in the 1970s and 1980s.
blood, modifying them so they can make a more The work of the Human Genome Project later
vigorous attack on a disease, and reinjecting them mapped out the human genome, with the
into a patient. The next page shows the full process completion of the project in 2003 giving us a greater
for Chimeric Antigen Receptor T Cell (CAR-T) understanding of what individual genes are
therapy, which many believe is the future of responsible for.
oncology. It is only now that the science is sufficiently
Gene therapy involves the modification of advanced enough – and the technology cost
somebody’s genes. A ‘normal’ gene is inserted to effective enough – to see treatments based on this
replace an ‘abnormal’ gene, potentially curing a work. In the decade and a half since the Human
genetic disorder entirely. While individual genetic Genome Project, the cost of sequencing or mapping
conditions are rare by themselves, together they are someone’s genome has fallen dramatically, from
quite common, affecting around three million people around $100m to $1,0003. This has made it feasible
in the UK alone1. Gene therapy is a one-off for healthcare companies to invest in developing the
treatment which could potentially cure millions of ideas and treatments behind personalised medicine.
people, and eliminate the struggle of managing a
genetic disorder altogether.
1 Genomics England
2 US Food and Drug Administration
3 National Human Genome Research Institute
15Individualized CAR-T therapy uses a patient’s own immune system to fight certain types
of cancers. A patient’s T cells are extracted and reprogrammed outside of the body to
ANNUAL REVIEW FOR CHARITIES 2019
recognize and fight cancer cells and other cells expressing a particular antigen.
How CAR-T Therapy
H O W C AWorks
R -T T H E R A P Y WO R KS
6. Cell Infusion 1. 1. Leukapheresis
Leukapheresis
6. Cell reprogrammed
Deliver Infusion CAR-T A patient's white blood cells, including T
A patient’s white blood cells, including T
cells into
Deliver the patient’s CAR-T
reprogrammed blood cells cells,
cells, areare extracted
extracted through
through a specialized
a specialized
into the patient’s blood blood
blood filtration
filtration process
process (leukapheresis).
(leukapheresis). The
T The
cells Tare
cells are
then then cryopreserved
cryopreserved and sent and
to a
sent to our manufacturing
manufacturing facility for
facility for reprogramming
reprogramming
7. Cell Death
7. Cell Death
Within the patient’s body, the CAR-T cells have the potential to
Within the patient’s body, the CAR-T cells have the potential to
recognize the patient’s
recognize the patient’scancer
cancercells
cells and
and other
other cells
cells expressing
expressing a a
specific antigen and attach to them, which may initiate direct
specific antigen and attach to them, which may initiate direct cell cell
death
death
CAR-Tcells
CAR-T cells attach
attach to Cell death is initiated
to cancer Cell death is initiated
5. Lymphodepleting cancer cells cells
5. Lymphodepleting
chemotherapy
chemotherapy
Lymphodepleting
Lymphodepleting
chemotherapy is
chemotherapy is given
given to
to
the patient to reduce
the reduce the
the
level of
level of white
white blood cells
cells CAR-T Cell
CAR-T Cell Cancer
Cancer Cell
Cell CAR-T Cell
CAR-T Cell Cancer
Cancer Cell
Cell
and
and help
help the
the body accept
accept
the
the reprogrammed
reprogrammed CAR-T
cells
CAR-T cells
Manufacturing Facility
Manufacturing Facility Tcells
T Cell
4. Quality Check
Check 2.Reprogrammed
2. Reprogrammed cells
cells
Strict quality testing occurs prior to the release Using an inactive virus (viral vector), T cells are
and shipment of the CAR-T Using an inactive virus (viral vector), T cells are
release and shipment of thecells
CAR-Tback to the
cells geneticallyencoded
encodedtotorecognize
recognize cancer cells
patient genetically cancer cells
back to the patient andother
and othercells
cellsexpressing
expressing a specific
a specific antigen
antigen
3. Expansion
3. Expansion Viral Vector
Newlycreated
Newly createdCAR-T
CAR-Tcells
cells undergo
undergo expansion
expansion
CAR-T Cell
CAR-T Cell
Source: Reproduced with permission of Novartis
Q U I LT E R C H E V I O T A U T U M N 2 0 1 9 5
OS009234_QC_Magazine_issue_11_Autumn19_UK[2].indd 5 23/01/2020 09:44
16ANNUAL REVIEW FOR CHARITIES 2019
Once somebody’s genome has been sequenced, new Beyond cell and gene therapy
technologies such as CRISPR (clustered regularly
The changes stemming from cell and gene therapies
interspaced short palindromic repeats) allow us to
go beyond new potential treatments however.
edit genes or turn them on or off without altering
Personalised medicine means more testing of
their sequence. CRISPR is widely used in scientific
patients to determine what exactly is wrong with
research today, and some people are even eating
them and to monitor how they are responding to
‘CRISPRed’ food.
treatment. Demand for medical testing equipment
and services is therefore increasing, benefitting
medical tool companies in particular. One such
The 100,000 Genomes Project
company, Thermo Fisher Scientific, is seeing
Towards the end of 2012, the UK government set up increased demand for its help in manufacturing cell
the 100,000 Genomes Project, which aimed to and gene therapies, and the instruments and
sequence the whole genome of various NHS services needed to understand the drug mechanism
patients. The project focused on people affected by of actions.
a rare disease or cancer, with its database
The development of cell and gene therapy comes at
particularly valuable due to its combination of
an important time for healthcare companies with the
genetic data and patients’ full medical records.
cost of researching and developing new drugs rising
The 100,000 Genomes Project has already yielded faster than drug prices. That trend looks set to
results. The first family with a genetic abnormality continue for the meantime, though the use of
– causing kidney failure – were diagnosed in 2015, artificial intelligence might streamline drug discovery.
with changes then made to their treatment. The The hope is that artificial intelligence improves the
100,000 Genomes Project is also being used to design of clinical studies and the manufacturing
develop areas like precision oncology. Genomics process.
England, for example, is partnering with certain
We look for several factors when it comes to
companies to combine genomic data on a patient’s
investing in healthcare. Given the political pressure
cancer tumour with the drug response of that
on drug prices, it is important to look for companies
tumour, potentially making treatment far more
that are taking novel approaches to target unmet
effective.
needs, as well as the more traditional issues such as
the opportunities in a company’s drug pipeline and
Is personalised medicine being used to treat how effective management are.
people today?
The widespread adoption of new treatments based Conclusion
on cell and gene therapy is still some way away.
The implications of cell and gene therapies are
However, there are some treatments coming
profound. We may be on the cusp of a new era in
through. Novartis, a Swiss drug maker, now offers a
medicine, one where treatments are based more on
form of CAR-T for leukaemia in children. The
us as individuals rather than generic treatments
company has one of the most comprehensive CAR-T
designed to work for whole populations. It could
development programmes, with thirteen advanced
impact everything from treatments to how we fund
platform therapies in clinical development, and nine
and pay for drugs. With our healthcare system
expected to enter the clinic in 2019.
currently designed to actively manage chronic
The opportunities around personalised medicine are conditions, the impact of personalised medicine may
forcing lead drug makers to look outside their be as much organisational as physical. The real
research and development budgets. Novartis acquired appeal of personalised medicine, however, will be a
AveXis in 2018, which received US approval of the first revolution in what we are able to cure, and how.
gene therapy for spinal muscular atrophy earlier this
year. Roche, another Swiss drug maker, has also been
on the acquisition trail buying Spark Therapeutics, the
owner of a gene therapy for retinitis pigmentosa, a
genetic disorder which causes a gradual loss of vision.
17ANNUAL REVIEW FOR CHARITIES 2019
CAN WE OVERCOME
EMOTION WHEN INVESTING?
Suneet Kumar, Quilter Cheviot
Do you consider yourself a brave person? Are you willing to find out?
This was the killer question behind Derren Brown’s
2018 TV show, Sacrifice. In the show, Brown attempts
to get US citizen, Phil, to take a bullet for another
man, a Mexican immigrant who is being attacked by
a biker gang.
Phil expresses anti-Mexican sentiments during his
2-3%
recruitment for the show, so it is surprising when he
eventually intervenes to save the life of the Mexican
man. By subtly promoting Phil’s empathetic side
in the weeks before the shooting incident, Brown
apparently changes how Phil would otherwise
act; leading Phil to save the life of a man he would
otherwise allow to die.
What’s particularly interesting about Sacrifice is
that it raises the possibility that we can all ‘hack’
our brains to simplify our lives, and make ourselves
better. And this has parallels with investing, where
trying to make rational decisions without the fog of
human emotion is of paramount importance. In fact,
(emotions lead the average investor to suffer around 2-3% in foregone returns every year)
Barclays estimates that emotions lead the average Making decisions without any emotion
investor to suffer around 2-3% in foregone returns
every year. Fortunately, the role of emotions in decision making
has received a lot of attention in recent years. There
Of course, Derren Brown’s experiment is slightly is even a new discipline for this, neuroeconomics,
different to what I wanted to look into. Sacrifice which brings together neuroscience and economics
shows how emotions can lead us to act in a certain and looks at how the two can provide insights into
way. My own thought was whether we could start to their respective fields.
rule out emotion completely. So I began to look into
the role of emotion when investing, and came across Thanks to the work of neuroeconomists, we now
quite a few interesting discoveries. have studies comparing how different people make
investment decisions. In ‘The dark side of emotion
in decision making’, Shiv, Loewenstein and Bechara
looked at the decision making process of people
with brain damage due to substance dependence,
specifically looking at whether their decreased
emotional reactions allowed them to make better
investment decisions.
18ANNUAL REVIEW FOR CHARITIES 2019
When introducing their study, Shiv, Loewenstein Of course, this does not mean that we should all
and Bechara cite the real-life example of someone try to disregard human emotion completely. As the
with brain damage who is driving a car that hits authors of the study put it, many of the participants
an icy section of road. While the other drivers hit with substance-induced brain damage suffered from
their brakes in panic, the driver’s lack of emotion – poor decision making in real-life, and their better
specifically fear – allowed him to remember that not performance was ‘likely the direct consequence of
hitting the brakes was the correct reaction. the emotional indifference about losses, and their
willingness to risk punishment in order to obtain
The study went on to look at three specific groups
reward.’
of people – people with brain damage, no brain
damage, and brain damage to due to substance
dependency. Each participant was given $20,
Can we make ourselves better investors?
which they were told to treat as real as it was their
compensation for taking part in the study. Over 20 But if emotion can hold us back from taking the right
rounds, they had to make a decision between two decisions, can we actually suppress our emotions to
options: invest $1 or do nothing. If they invested, make us better investors? To a certain extent, this is
they had a 50/50 chance of either losing their $1, what a lot of people do already. Staying invested no
or keeping their initial dollar stake and gaining an matter what, or drip feeding money into markets on
additional $2.50. a regular basis are both strategies which remove the
need to take decisions, and thus the wrecking ball of
As the expected value on each round ($1.25) is
emotion.
higher than if one does not invest ($1), the correct
decision would have been to invest in each round. If There is also plenty of research on how we can
you did invest in each round, you would have only a take better decisions. Perhaps the most interesting
13% chance of earning less than if you just pocketed example of this is The Good Judgment Project, the
the $20. brainchild of Philip Tetlock, a Canadian-American
scientist. Tetlock wanted to test the accuracy of
The results of the study showed that people with
expert predictions, and find out whether their
brain damage – either from substance abuse or not
specialist forecasts were any better than those of the
– tended to make decisions that maximised profits
man in the street.
more than those without brain damage. Those with
brain damage ‘were not influenced by the emotional In 2011, the Intelligence Advanced Research Projects
reactions associated with the outcomes of preceding Activity (IARPA) – a branch of US intelligence –
rounds, so that they were more predisposed to launched a competition to identify cutting-edge
taking risks.’ methods to forecast geopolitical events. Five
scientific teams competed to generate forecasts
on the type of questions US intelligence agencies
needed answering every day. The competition was
unprecedented, partly because it was one of the few
attempts to measure the accuracy of US intelligence
forecasts, but also because it generated an
unparalleled dataset on what forecasting methods
worked.
More than one million questions later, the Tetlock’s
Good Judgment Project (GJP) emerged on top. In
Year 1, the GJP team managed to beat the official
control group by 60%. In Year 2, that gap widened
to 78%. By the end of the second year, the GJP
team were doing so well that IARPA dropped their
academic competitors. The team had even managed
to outperform intelligence analysts who had access
to classified data.
How could a team of outsiders perform better than
America’s foremost intelligence experts? The answer
lies in how far you are prepared to analyse your
(emotions in decision making )
19ANNUAL REVIEW FOR CHARITIES 2019
decisions. Tetlock and his team identified a group of individuals – Superforecasters – who were particularly
skilful at making predictions. These individuals were far more open-minded in their thinking and deliberately
tried to cultivate their forecasting ability. When forecasters practiced assigning precise probabilities to the
predictions, for example, they became better at distinguishing finer degrees of uncertainty.
Answer, check the answer, repeat
Much of what happens is about double checking yourself. Take the following question, for example: you have
two tokens in your pocket, which together are worth £1.10. If Token 1 is worth £1 more than Token 2, how
much is Token 1 worth? If you immediately answered £1, think again. The correct answer is actually £1.05.
When answering a question, the majority of us reach for the simple answer. Few people bother to check that
the value of their answers actually adds up to £1.10. If you do, you quickly discover your elemental mistake,
and come up with the answer relatively easily.
Making better investment decisions might therefore appear deceptively simple – you think carefully about
your decision and then double check your assumptions. This is hard to do in practice though. If you want
to become a better investor, slow down and think. And if you don’t have time to slow down, you can always
appoint a discretionary investment manager!
20ANNUAL REVIEW FOR CHARITIES 2019
VOTING AND ENGAGEMENT - QUARTER 4, 2019
VOTING AND ENGAGEMENT - QUARTER 4, 2019
REVIEW OF RESPONSIBLE
INVESTMENT 2019 AND
A N N UA L VOTIN G STATISTIC S
A L O AON NKUAA HEA
L VOTIN D T O S2 0 2 0
G STATISTIC
OverWoodward,
Gemma 2019 we voted
Quilter at:
Cheviot
171
Over 2019 we voted at:
In 2019 we voted at:
171
COMPANY
MEETINGS
COMPANY
MEETINGS
VOTE VOTE
VOTE vote against a VOTE vote against
remuneration report election of an NED
vote against a vote against
remuneration report election of an NED
(6 votes against)
VOTE
(6 votes against)
VOTE
VOTE vote against VOTE vote against activist
remuneration policy investor joining the board
vote against vote against activist
(1 votes against)
remuneration policy (1 votes against)
investor joining the board
VOTE
(1 votes against)
VOTE
(1 votes against)
VOTE vote against VOTE abstention of
investment policy re-election of an NED
vote against abstention of
(1 votes against)
investment policy (1 abstention votes)
re-election of an NED
VOTE
(1 votes against)
VOTE
(1 abstention votes)
VOTE vote against the wind VOTE vote against share issuance
up of a property company
vote against the wind
vote against share issuance
(1 votes against)
up of a property company (1 votes against)
(1 votes against)
It is important to note that on a number of occasions having engaged
(1 votes against)
with
It is the relevant
important company
to note weadid
that on not follow
number ISS’ recommendations.
of occasions, having engaged
It is important to note that on a number of occasions having engaged
with the relevant company, we did not follow ISS’ recommendations.
with the relevant company we did not follow ISS’ recommendations.
21
7ANNUAL REVIEW FOR CHARITIES 2019
MANAGEMENT RESOLUTIONS VOTED IN 2019
6%
With management recommendation
Against management recommendation
94%
TOPICS WHERE WE HAVE VOTED AGAINST MANAGEMENT
9%
36%
Audit and accounts
Board structure
Capital structure
Corporate transactions
Remuneration
Shareholder rights/company articles
Other business
46%
9%
8
22ANNUAL REVIEW FOR CHARITIES 2019
2020 AND BEYOND
We have spent the period since March 2017 voting and engaging with our core UK companies. In 2020, we
are adding further companies to our voting universe which will result in it doubling in size and covering just
over 75% of our UK holdings (which have voting rights). It is worth noting that roughly 45% of the assets we
hold on behalf of clients have annual voting rights; of the other 55%, these are largely investments in open
ended funds as well as direct bonds.
The expanded universe will comprise all holdings in managers with whom we invest consider ESG when
our monitored equity list for the UK, where we own making investment decisions. For more information
over 0.2% or £2million of the company/investment on our approach please refer to the Fund ESG
trust. We have a long tail of holdings, which is Integration piece in our responsible investment
unsurprising given the nature of our client base; document. In addition to this, over the last year
we do not intend at this stage to vote on every we have continued our focus on governance for
single position we have. The reasoning is simple: listed funds, and have been questioning boards
voting has to happen alongside engagement and, on how they hold the manager accountable on
therefore, whilst we could easily vote on every ESG considerations and disclosure. This work will
single holding globally, we would not engage on continue.
that scale in a meaningful way, and in some cases
For our direct equity positions, we have primarily
the position will only be held by one client.
focused on governance considerations although
With regards our other direct equity holdings in that is not to say that we have not engaged with
the US and Europe as well as other jurisdictions, we companies on other environmental and social
are not at this stage adding these to the universe. issues. In 2020, the focus will be to increase this
Our rationale is that whilst we may own $100m in work alongside the equity research team with the
our largest US holding, this position equals 0.01% objective of ultimately ensuring all our monitored
of the share capital. When we undertake voting we holdings have undergone a formal ESG assessment
do so alongside engagement; as things currently as part of the investment case.
stand we feel that it would be difficult for us to gain
Finally, new regulations mean that ESG and
access to the board (the analysts obviously meet
responsible investment remain a core focus for our
with the company on an ongoing basis anyway)
business. There will be a requirement for increased
in order to engage satisfactorily. This will not stop
disclosure around voting and engagement as well
us in collaborating with other investors, or indeed
as the revised Stewardship Code calling for a higher
changing our position in the future.
standard from asset managers.
We began looking at how we think about ESG
As ever, this is a journey and the ongoing work is
integration for the third party funds that we invest
never-ending. ESG integration for us is a process,
in at the end of 2018. Over the year, progress has
not a product.
been made with this and, in 2020, the team will
continue with this work analysing how third party
23ANNUAL REVIEW FOR CHARITIES 2019
BIG OIL AND CLIMATE
CHANGE: ENGAGE OR DIVEST?
Liz Dhillon, Greg Kearney and Gemma Woodward, Quilter Cheviot
What role should oil and gas companies play in combatting climate change? The sector has certainly been coming
under greater pressure to act, with shareholders forcing BP’s management to address how the company’s strategy
fits in with the Paris climate agreement last year.
Investors are not necessarily taking a unified approach Coal
however. Some champion engagement, encouraging While replacing fossil fuels is difficult,
companies to lower their emissions and invest in new there are benefits to switching between
technologies. Others prefer to divest and sell their fuels, particularly replacing through
Oil replacing coal. The shift from coal to
stakes in companies, hoping to force them to confront
gas-fired electricity generation has
the impact of their activities. Yet divestment is not
played a significant role in reducing the
always done for environmental reasons, with some
UK’s carbon emissions over the past 30
investors arguing that oil companies will be forced to Gas
years, with natural gas emitting half the
leave oil reserves in the ground as the world attempts CO2 of coal when burned.
to tackle climate change.
A further split concerns counting the emissions from
just the activities of oil and gas companies, or including when most forecasts show that the global economy
the emissions from burning the products they sell will remain significantly dependent on fossil fuels
too. The latter approach could have a much greater for some time to come – although it might equally
influence on tackling climate change. A report from the be argued that a pure coal company is not going to
Climate Accountability Institute (CAI) in October 2019 suddenly change. According to BP, oil and gas will still
claimed that just 20 energy and mining companies account for around 50% of primary energy demand
accounted for more than a third of global emissions in 2040, even in a scenario where we see a rapid
from 1965 to 2017. transition to a low carbon economy3. Engaging with
the energy sector might therefore be the best strategy
Crucially, those emissions included pollution emissions
to minimise emissions until the switch away from oil,
from both a company’s own operations and the burning
coal and gas is complete.
of its products. But what is important is the action
those companies (and others) are taking to change this. Engagement is gaining traction globally, with
Companies like Royal Dutch Shell, for example, have divestment sometimes held back as a threat to
already pledged to reduce their total emissions from both concentrate minds. This has been the approach
their own activities and the burning of their products. of investors such as the Church of England, with
its General Synod voting to divest from fossil fuel
Engagement vs. divestment: which wins out?1
companies that have not aligned their activities with
The immediate debate, however, is around
the Paris Climate Accord by 2023.
engagement vs. divestment. There have been several
high profile cases of divestment, with banks such Many companies are now responding to investor
as HSBC, Standard Chartered, RBS and Lloyds demands. The Transition Pathway Initiative, a group
announcing that they would no longer finance new of investors, has surveyed 308 companies across
coal plants, for example2. the fourteen most carbon-intensive sectors of the
global economy and found that a third now link senior
Investors who divest from a company, however,
executive pay to climate performance, including Shell
immediately lose any leverage in pushing for change,
and BP from the UK stock market.
1 https://www.cnbc.com/2017/11/29/oil-giant-shell-plans-to-halve-its-carbon-emissions-heres-how.html
2 http://www.ethicalcorp.com/divestment-isnt-badge-honour-its-failure-engagement
3 https://www.bp.com/content/dam/bp/business-sites/en/global/corporate/pdfs/energy-economics/energy-outlook/bp-energy-out-
look-2019.pdf
24ANNUAL REVIEW FOR CHARITIES 2019
What concrete steps can the oil and gas sector Politics still matters
actually take?4 Nevertheless, governments still need to do more. The
Shell is seen as something of an industry leader when World Meteorological Organisation recently warned
it comes to addressing climate change. In 2017, it that the concentration of greenhouse gases in the
became the first international oil and gas company to atmosphere reached a record high in 2018, with urgent
commit to reducing its net carbon footprint – of both action needed in the next decade.
its operations and products, following this up in 2019 While the challenge is significant, progress is being
with concrete short-term targets. made. The Paris Agreement, reached in 2016, commits
signatories to keeping the increase in global average
temperatures to 2C this century. Signatories are obliged
DI D YO U K NOW ? to report their carbon emissions, with the international
community hoping that a spirit of accountability will
Royal Dutch Shell supplies around
take hold as a result. There is scope for a ratcheting and
3% of the world’s energy.
review mechanism within the Agreement, with failure to
take action leading to more urgent (and ultimately more
Investors have played a critical role in encouraging disruptive) climate policies later down the line.
Shell to set short-term net carbon footprint targets, Can oil companies be part of the solution to
with the pay of its top 150 executives now linked to climate change? It doesn’t seem prudent to leave
emissions related goals. But in 2019, the company went them out. The US may have pulled out of the Paris
a step further, releasing its first three-year emissions Agreement, but companies can still work to reduce the
target and aiming to reduce its net carbon footprint environmental impact of their US activities. Engaging
by 2-3% from 2016 levels. It also committed to set new, with companies provides another avenue to help
more ambitious three-year targets in 2020. reduce emissions, one that an individual investor can
Equinor, a Norwegian oil company, is another example be part of if they invest with managers who practice
of the progress a traditional oil and gas business can engagement.6
make. The Climate Disclosure Project ranks it as one Another area which we should all be thinking about is
of the most advanced in terms of thinking through our own actions. Are we as consumers cognisant of
the transition to a lower carbon future. Between 2014 the impact of our own behaviour or is it sometimes
and 2018, for example, it reduced emissions from its too easy to blame the corporate? Shell has introduced
onshore US gas operations by 80% through reducing a scheme in the Netherlands where, for an extra cent
methane leaks from its pipelines. 5 The methane on a litre of petrol, the company claims it will offset
intensity of Equinor’s natural gas production is now the consumer’s carbon emissions. So far 20% of Shell’s
around one tenth of the industry average, and it has Dutch customers have taken the company up on this
even advocated for greater regulation on methane offer.7 We all need to be aware of the impact of our
leakage for the wider sector. own actions and that we, as consumers, are the end
While still a relatively small part of their businesses, demand point for hydrocarbons.
both Shell and Equinor have moved into areas like As companies think more about their ‘social licence
renewable electricity generation, with Shell investing to operate’, investors are increasingly thinking about
in wind energy in both the US and the Netherlands. how companies can be part of the solution to climate
Shell’s involvement in wind energy forms part of its change. Oil and gas companies often have significant
New Energies business, which is also involved in solar resources and expertise – not least the large scale
energy, biofuels, electric vehicle charging, and funding engineering competencies needed to overhaul
new start-ups. As of December 2019, its start-up the world’s energy infrastructure and distribution
arm, Shell Ventures, listed investments in 44 different networks. Those skills have been put to good use in
businesses, as well as eleven holdings in fund/ some cases, with companies like Royal Dutch Shell
incubator style investments. Shell and Equinor’s efforts and Equinor making tentative steps in this direction.
represent the right direction of travel, even if more Investors should continue to engage and keep up the
work is needed to ramp up activity. pressure – it’s working.
The companies mentioned in this article are for general interest
and should not be taken as buy or sell recommendations.
4 https://www.shell.com/energy-and-innovation/the-energy-future/what-is-shells-net-carbon-footprint-ambition.html
5 https://www.equinor.com/en/how-and-why/reducing-methane-emissions.html
6 We follow an engagement approach at Quilter Cheviot, but we are by no means the only professional investors doing this.
7 https://www.shell.com/media/news-and-media-releases/2019/shell-invests-in-nature-to-tackle-co2-emissions.html
25ANNUAL REVIEW FOR CHARITIES 2019
OUTLOOK 2020:
A FAMILIAR QUANDARY
Alan McIntosh, Quilter Cheviot
As we look ahead to what the coming year might hold for investors, it’s worth
The starting reflecting how different our starting point is to twelve months ago. At the
point for beginning of 2019, the FTSE 100 had fallen by about 10% in just three months,
investors is very while US shares had performed even worse, losing approximately 20%.
different now
compared to The start of 2019, however, also saw the most important event of the year – the
the beginning Federal Reserve’s U-turn on raising interest rates. While economic data seemed
of 2019. set to continue weakening, investors now knew that the Fed had their back. Stock
market valuations looked reasonable, tipping enough people into an optimistic
bent and prompting a dramatic rally that has led shares to new all-time highs.
This year, we’re left wondering where to go next. Economic data has largely
While stabilised, though there are soft patches. Central banks, most notably the
policymakers are Fed, but also the European Central Bank, remain supportive, with low inflation
more supportive having allowed them to become progressively more accommodative of markets
and corporate throughout last year. Completing our trifecta of optimism, corporate earnings are
earnings look set likely to grow this year, in contrast to 2019, which was largely a year of subdued
to grow by low to numbers.
mid-single digits,
stock market The trouble is that market valuations are much more stretched. That leaves
valuations are little room for error over the year ahead. And while we don’t necessarily believe
less compelling. anything will go wrong – the global economy continues to muddle through
– recent events in the Middle East highlight how geopolitics or unanticipated
developments can upset markets.
26ANNUAL REVIEW FOR CHARITIES 2019
Chart 1: Global shares continued to do well in 2019
160
150
140
130
120
110
100
90
80
Dec 2016 Jun 2017 Dec 2017 Jun 2018 Dec 2018 Jun 2019 Dec 2019
Source: Refinitiv, January 2020. Chart shows global shares (FTSE All World) rebased to 100 at the end of
2016 and finishing at the end of 2019.
Soft economic growth held up by the consumer and services
Manufacturing
In some ways, 2020 will be very similar to 2019. Investors will spend much of the
data continues
year worrying about the health of the manufacturing economy, with survey data
to be the main
concern for showing the sector is in contraction in the US and across much of Europe. While
investors. Chinese manufacturing is showing some tentative green shoots, this is still very
early. Boeing’s announcement that it will suspend production of the 737 Max, which
hasn’t yet made its way through to the data, is unlikely to improve the picture in
the short term.
What really matters, however, is whether this spills over into consumer behaviour
However, and the services sector. The consumer is responsible for over 70% of US GDP,
consumer making it a much more important factor in GDP. The good news is that US
behaviour consumers are continuing to save a historically high proportion of their income
remains – relative to recent history at least. This suggests that the current economic
supportive of expansion has further room to run and that any future recession could be relatively
the economy,
mild, certainly compared to the 2008 crash.
with few signs
that households
Chart 2: US savings rate shows consumers remain in good health
are financially
overstretched. 14
12
10
8
%
6
4
2
0
2000 2001 2002 2003 2005 2006 2007 2008 2010 2011 2012 2013 2015 2016 2017 2018
US savings as a % of disposable personal income
Source: Refinitiv, January 2020
27ANNUAL REVIEW FOR CHARITIES 2019
There are two further reasons to be cheerful. First, employment continues to grow
More broadly, in the US, with workers benefitting from rising real wages – i.e. more money in
there are some their pocket after taking account of inflation. Second, US service sector data has
encouraging shown some tentative signs of improvement, with the December survey reading
signs in service showing a rebound in overall activity. While this is only a snapshot from one month,
sector data. European data showed the same picture.
Can the industrial sector start to help out?
The pressure on Of course, investors might still breathe easier if we saw an industrial rebound.
manufacturers There are few obvious catalysts for this however. The recently agreed Phase 1 trade
should ease deal between the US and China contains a few provisions to reduce tariff rates, but
with the Phase 1 these remain relatively small scale. Markets mainly welcomed the agreement as it
trade agreement signalled an end to further tariff escalation.
between the US
and China, but Any wider agreement between the US and China will have to overcome three,
various issues likely insurmountable, barriers. China’s disregard of US intellectual property (IP)
prevent a more is the biggest issue. The US is unlikely to want to compromise on this, with many
comprehensive in the country now regarding China as a strategic competitor. Indeed, tougher
US-China deal. action on Chinese infringement of American IP is one of the few bipartisan areas of
agreement.
Other issues include whether it is actually possible for the US to close its trade
deficit with China (even assuming a commitment from both sides) and what might
be termed more ideological disputes, such as over the protests in Hong Kong, or
the treatment of the Uyghur Muslim population.
Will markets be rooting for Trump?
Investors Trade tensions will inevitably be influenced by the upcoming presidential election.
are nervous On a positive note, a desire to get re-elected may well encourage Trump to claim
about some of victory in the trade dispute with China, regardless of the actual state of affairs.
the potential
Democrat In many ways, it is the Democrats that are worrying investors. While Joe Biden, the
nominees for current front-runner, is a moderate, his closest rivals (Elizabeth Warren and Bernie
President. Sanders) are firmly to the left of him. According to the political blogging website
fivethirtyeight, Biden has approximately a one in three chance of winning the
Democrat nomination, based on where he was in the polls across the second half
of 2019.
Elizabeth Warren
and Bernie With the first primaries being held in early February, there is still plenty to play for.
Sanders, two Combined, Warren and Sanders also have around about a one in three chance of
firmly left-wing the nomination. Warren has sprung to prominence with her controversial stances
candidates, on breaking up technology companies like Facebook and Amazon, as well as her
are proposing proposals to regulate the banking industry more tightly and ban fracking. A ban
radical economic on fracking would have a dramatic impact on US industrial activity alone, leading
reforms that to a string of bankruptcies and even having a knock-on impact on global oil prices.
would have Sanders has many similar policies, and will be familiar to investors from the 2016
far-reaching primary election when he pushed Hillary Clinton closer than many expected.
consequences
for investors.
28You can also read
