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Guest in Classroom #3: Socially Responsible Investing

Recently, Hochschule Pforzheim hosted its third Guest in Classroom session addressed to both first and third year students in the MBA International Management program.  This session’s speaker was Hochschule Pforzheim’s own MBA alumnus James Dymond. James Dymond is the Senior Investor Relations Manager at SAP SE in Walldorf, Germany, and spearheads the company’s socially responsible investors (SRI) program.  At SAP Mr. Dymond manages relationships with current and potential investors regarding environmental, social, and governance topics (commonly abbreviated to ESG).
So what exactly is SRI and ESG and how do they work together? While SRI remains a fairly novel field within financial markets, it is rapidly expanding and showing high relevance to how the world is increasingly becoming more cognizant of social and environmental factors. Mr. Dymond pointed out that 2020 has proven the need for SRI amidst the current Covid-19 pandemic which has shaken global markets.
While the primary goal of making a profit remains, investors are now looking for environmental, social, and corporate governance mechanisms that add to a company’s sustainability impact. Initiatives depend on the investor and company of course; however, SRI is a heterogenous group that examines a number of aspects such as CO2 emissions, water usage, diversity in the workplace, human rights in the supply chain, composition of executive and supervisory boards, and board of investor’s pay structure.
Mr. Dymond elaborated that while there are a number of factors to account for, this paradigm shift amongst investors from solely profit to people, planet, AND profit is due to how ESG factors can mitigate risks, namely reputational risks that directly affect a company’s bottom line.
Due to the strategy SAP SE has taken to address these ESG factors while determining long term competitive financial returns, SRIs look favorably upon SAP for its efforts. SAP SE specifically supports the United Nations Sustainable Development Goals, a diversified supervisory board with 50% female representation, increased transparency in Compensation Report, employee engagement with an achieved goal of 25% women in management, education and opportunities for employee development, a Green Cloud, and goal of becoming carbon neutral by 2025.
Mr. Dymond’s information and insights provided an engaging Q&A discussion amongst the students before closing on this valuable and highly relevant Guest in Classroom session.

text: Gabrielle Boimann, Class of 2022
screenshot: Gabrielle Boimann