In the latest episode of our video series, I am pleased to welcome Dr. Patrick Zenz-Spitzweg. We have exceptionally exchanged the couch for a park bench, to talk about sustainable investing in a special environment.
I hope you enjoy watching the episode or reading up on the conversation!
Eric Schott: “Welcome to today’s edition of the Schottcast! We’re sitting outdoors today, right near some vegetable growing areas and orchards that are about 250 years old. We’d like to take a broader look today at a topic of interest across society – or actually, two topics we’ve both been following eagerly for quite some time now. The first one is the topic of saving, or investing, especially on the capital market, and the second is sustainability.
And that’s what we’ll be talking about today with you, Patrick. Dr. Patrick Zenz-Spitzweg, Divisional Board Member at FERI AG, where he is responsible in particular for private clients and investment advising. So he’s just the right person to talk to about this. Ttell us, Patrick, how did we come up with this crazy idea?”
Dr. Patrick Zenz-Spitzweg: “I remember that quite well, because whenever we meet up, we always leave with a whole bunch of amazing ideas, and the idea of doing a Schottcast together came up following an evening event for entrepreneurs. We walked out, had a drink at the bar afterward, and then we came up with it together.”
Eric Schott: “Something that really concerns me, and something that I’ve noticed, is that right now, only about one-fifth of Germans have invested in shares. Among women, we see a gender gap further exacerbating the trend, so only about 12% of the female population invests in stocks. Do you have any idea why?”
Dr. Patrick Zenz-Spitzweg: “Well, the figures show that the share is rising, at least – so, Germans are tending to invest more. There are various reasons. I think that in Germany, for historical reasons, there’s a certain anxiety or hesitancy about the stock market, unlike in places like the United States, for example. And it might also have something to do with lack of prior knowledge, so education and literacy in the area of investing.”
Eric Schott: “Yes, that could well be the case, of course. One thing that’s always concerning there, too, is that only about 70% of school graduates report that they have any knowledge at all in this area.”
Dr. Patrick Zenz-Spitzweg: “Yes, that’s definitely the case, and if there’s no knowledge, then people are probably just worried about making mistakes. So, when in doubt, they just leave everything in a savings account and actively decide against financial products, and by that I mean stocks.”
Eric Schott: “That’s really exciting, because we’re helping a lot of companies right now reach their sustainability goals faster. But that also means you have to have decided first, I want to do more for sustainability, too. And I have the impression that this is also the case in the individual segment, too.”
Dr. Patrick Zenz-Spitzweg: “It’s absolutely a very, very individual decision. And as an investor, you really have to ask yourself, where should sustainability fit into my investment strategy? Just like you take a position on risk or yield, you also have to think about sustainability.”
Eric Schott: “Now we have a lot of opportunities to go into sustainability, but might there be two areas of focus you see there?”
Dr. Patrick Zenz-Spitzweg: “Not areas of focus, it’s more of a spectrum. So, you can rule out certain things and say, I’d like to avoid certain things in my portfolio, or you can say, I’d like to make a specific difference.”
Eric Schott: “Hey, I think that’s really exciting. And could you give us a little more concrete idea at this point? Do you have examples, maybe?”
Dr. Patrick Zenz-Spitzweg: “Yes, well, when it comes to avoidance, it’s generally fairly practical, so you might say you want to avoid child labor, alcohol, tobacco, weapons, and so on – it’s usually fairly obvious. But then you can take it farther, so on that scale from “not this” to “make a difference,” and then you can identify individual sustainability criteria for yourself and say, which of these criteria – so that’s usually the 17 United Nations SDGs – which of these 17 criteria are especially important to you, and then you can just sort of position yourself to invest in specific criteria.”
Eric Schott: “So, to me it sounds a bit like you might start out with a general fund, so you’re not doing anything wrong, so to speak, but setting the right areas of emphasis. And then maybe once you’ve gotten a taste for it, and built some experience, then you might dig in and analyze things, see which companies are a good fit for you in this or that respect and where you’d like to become a shareholder.”
Dr. Patrick Zenz-Spitzweg: „Absolutely. I mean, the market is really highly dynamic right now, of course. There are constantly new solutions and products coming out, and that would be a good place to start. And then, when you feel a bit more secure, you could also think about investing in specific companies, meaning individual instruments, investing in stocks.”
Eric Schott: “Might there also be some kinds of funds where you can just contribute regularly and then you’ve also set the right tone?”
Dr. Patrick Zenz-Spitzweg: “There are a whole lot of different products, and more are constantly being added. As an investor, you can actually find a sustainable version of just about any equity fund – whether it focuses on certain sectors or regions or countries – and then invest in that, including through savings plans, for example, since you just mentioned that.”
Eric Schott: “And for you at FERI, sustainability is the top priority, or at least that’s what I understood.”
Dr. Patrick Zenz-Spitzweg: “It’s a very important subject for us. We founded our own SDG office seven years ago, a sustainability office, and we’ve also grown and developed in asset management, so our clients can also define their own sustainability criteria and implement their investment strategy on a very targeted basis with regard to their needs.”
Eric Schott: “Well, that was it for this Schottcast. Let me just sum up briefly as a takeaway. You might say it’s something of a civic duty to learn about stocks, or even better, to invest a bit regularly yourself, and especially to think about how you can support sustainability with your investment activities as well. Great talking with you, Patrick. Thanks so much.”
Dr. Patrick Zenz-Spitzweg: “My pleasure. Thanks, Eric.”
