The new chief of super at Australian Ethical, Ross Piper, says there is a lot to bear in mind when building a values-based career.
An increasing number of people are keen to pursue a career that combines purpose and profit.
They want reasonable pay in organisations that do good for society.
"This is especially true in funds management where capital allocation impacts the world in a very real way," Piper says.
During his career, Piper has seen more and more capital allocated to investments that achieve financial and social returns.
He has long believed that specialist asset managers play a crucial role in connecting private capital at scale - most often from asset owners - to investments that generate solid risk-adjusted financial returns and have a positive societal and environmental impact.
"I think capital has a profoundly positive purpose - it can contribute meaningfully to some of the world's most complex issues and problems," he adds.
Piper's career has long traversed the corporate and the not-for-profit. That's because he has always believed that corporate or institutional and development interests are compatible and can be aligned.
And this view is gaining traction.
"Increasingly, more and more people are realising that the choices they make about where they work actually makes a difference," he explains.
"For many people post-Covid - from graduates right through to executives - the type of company they choose to work for, what it stands for, and what it does and doesn't do is deeply important."
In his experience, people who find meaningful work in a flexible and supportive environment will not look elsewhere.
"I think it'd be fair to say, in most places I have worked there's a high degree of alignment between purpose and vocation.
"When you see highly capable professionals working with a deep alignment of a firm's purpose with what they're doing, it's very powerful."
Piper adds that for businesses, the growing desire among employees for value-aligned work affects both recruitment and retention.
"Many businesses, large and small, are going through a sort of evolution, often driven by the employees themselves. From a recruitment perspective, employees who are searching for meaningful work are very desirable because it shows they have a real passion for the company and what it stands for."
At least half of Piper's career has been spent in the corporate sector, with the other half in economic development.
Then, as now, he was a proponent of shared value - a strategy where companies create measurable economic benefits by identifying and addressing social problems that intersect with business.
"It's about enhancing the competitiveness and effectiveness of a business while aiming to improve social and environmental conditions in the regions where it operates," he explains.
Back in the day, Piper worked as a geophysicist, before moving into community development roles, and did a six-year stint as head of corporate risk at Macquarie Group.
He then began working for World Vision in the Middle East and Eastern Europe, working in some of the most challenging and politically volatile parts of the world, before serving as the chief operating officer at World Vision Australia for two years.
"For me, the intriguing issue was always whether institutional capital contributes to sustainable development goals but invests in a way that meets fiduciary requirements for risk-adjusted financial returns," he states.
"There is demonstrable evidence that it has and continues to play a profound purpose in helping to solve some of the world's most complex problems and issues."
"While none of us has a linear career path these days, if I look back, I can see how the pieces have fitted together".
Now back in funds management and superannuation, Piper can deploy and manage capital with a sharp focus on what that money can contribute to society.
Investing has always been complex - and especially in the current environment due to the continuing volatility of equity markets.
"Still, I say, investing ethically and making a profit is achievable - it's not philanthropy. And that is one of the reasons this fund has been so successful."
On Rainmaker Information data, Australian Ethical's primary superannuation fund, Australian Shares ranks 1st over 10 years, with a return of 10.44 per cent out of 43 Aust equities options.
March 2023 performance tables that same option still ranks 1st over 10 years, with a return of 10.40 per cent, out of 44 Australian equities options.
Australian Ethical's primary superannuation fund, Australian Shares, has generated a 10.7 per cent return over the past ten years, which was ranked first out of 43 funds, according to industry data.
Piper concedes the past year has presented a more challenging environment but remains confident that the fund will continue to deliver over the longer term.
"Investment markets will always go through cycles. And there'll be certain sectors that will outperform in some markets but underperform in others.
"We have conviction that the underlying settings in the portfolio, and the exclusions we have, are aligned with a long-term financial benefit for members and investors."
"What's critically important, is that investors have very clear beliefs about where and how they invest, and that they have the conviction to hold those beliefs through varying market cycles."
For example, the Ukraine conflict has created headwinds for certain investment strategies that may exclude parts of energy stocks.
Australian Ethicals applies a very robust set of screens and criteria concerning which geographies it invests in.
"When the Ukraine crisis happened, many funds needed to try and divest Russian assets. We were different. We were never there because of the screens."
Bringing them across
Australian Ethical recently announced two new hires - a new chief investment officer, Ludo Theau, former investment chief of the Clean Energy Finance Corporation, and a head of ethics and research, Alison George, from Regnan, who work closely together to ensure all investments meet its rigorous screening processes.
Piper notes: "Australian Ethical is one of the fastest-growing super funds in the country, we see that growth accelerating, so we've put in place a world-class team that can support that growth.
"There is a clear strategy that's been articulated clearly to our investors by our chief executive, John McMurdo, to accelerate growth across all our managed funds.
"Some of that is happening organically, and we are still seeing net flows into our super business. But we're also looking at potential partnering opportunities."
What the organisation does, he goes on to say, is increasingly resonating with the market.
RIAA research from 2022 found there is a sizeable shift towards responsible investing, with Australia's responsible investment market reaching a record $1.5 trillion in assets under management in 2021, and now representing 43 per cent of professionally managed funds.
"Again, for us, we think that the two issues of how you invest ethically, the long-term questions that are facing society around the environment and well-being and finances, are part and parcel of the same value proposition for members, what sort of world will they retire into? And how can we as investors contribute to that positive?"
"Not only do people want to work with organisations that align with their values, but they also want to invest their super - their future - in companies that do good by people, animals and the planet.
"It's been exciting to see the growth in the responsible investment sector over time, and it's very encouraging to see the pace at which the shift is now occurring."
In 2022, Piper was appointed chair of the Responsible Investment Association of Australasia.