For Asahi Pompey, there is no such thing as a half-empty or half-full glass on the subject of the present sustainability scene. The glass is full — and overflowing.
As president of the Goldman Sachs Basis and one of the infectiously optimistic people I’ve shared digital house with, the toughest a part of Pompey’s job is determining the place greatest to allocate capital given the abundance of worthy organizations to help.
Homing in on sustainability in capital markets as a wider class, and ESG investing particularly, one of many core tenets is that it’s decidedly not philanthropy. Reasonably, it’s the pursuit of revenue with critical consideration for and integration of loftier (though typically poorly outlined) targets corresponding to function and impression.
It’s a really tumultuous time for the ESG investing business: There’s confusion about what ESG even is, what it is meant to realize and the way it does so. As such, I used to be curious to study the vantage level from a basis corresponding to Pompey’s as to the way it conceptualizes sustainable investing and the way the pushback in opposition to ESG and sustainable investing are, or aren’t, affecting her work.
As Pompey informed me of those previous few years of pandemic, “You’ll be able to both see it as one of the difficult durations or a interval that offered an unprecedented alternative for us to get centered on group impression — not with phrases, however with deeds.”
The dialog has been edited for readability, size and elegance.
Grant Harrison: Asahi, your practically 17-year tenure with Goldman Sachs contains roles as co-chief compliance officer and world head of compliance for the funding banking division. How do these experiences inform the way you lead the muse?
Asahi Pompey: I believe I am perhaps essentially the most unlikely accomplice at Goldman Sachs, and an unlikely president of a basis. I grew up within the housing tasks in Brooklyn when my household got here from the Caribbean, after which grew up engaged on offers, IPOs and M&A, however then received a name from the chair of the agency, John Rogers, to tackle this function with the muse. If I had blasted out my resume to very large foundations and mentioned, “I need to be the president of your basis,” they’d’ve mentioned, “No means, you haven’t any expertise on this space.”
Total, the critique within the sustainable investing house facilities across the false dichotomy between profitability and reaching sustainability targets.
It’s been unbelievable to see the parallels from a authorized function with working the muse. Particularly, the identical rigor, depth and focus that we ship to our shoppers in engaged on a merger is that very same rigor we ship to our 10,000 small companies, our girls entrepreneurs in India and the Black girls and women that we’re working with by means of One Million Black Girls. There is a “Goldman commonplace,” if you’ll, that is utilized wherever you might be on the agency and I can vouch for that from shifting from my authorized function into the muse.
Harrison: The ESG investing house has completely exploded these previous two years, however not with out pushback — dubiousness about how helpful ESG rankings are and the conflation of ESG investing with planetary motion and sustainability. As a company basis centered on investing sustainably, what has your expertise been with the pushback? Are there criticisms of the ESG house that resonate with you, or that don’t?
Pompey: Once I hear critique of an area, I all the time suppose “OK, what’s underpinning this broad critique? Is it simply skepticism, or is there one thing extra that the recipient of the criticism needs to be doing or doing otherwise?” Total, the critique within the sustainable investing house facilities across the false dichotomy between profitability and reaching sustainability targets. A key critique is that sure, we hear you all discuss measurement and metrics — so what’s the true impression? It is a vital critique that needs to be addressed upfront with, once more, daylight and transparency, dependable information and an open guide round whether or not a sustainability report actually exhibits what’s taking place beneath the hood. Criticism is welcomed and we need to present what we’re doing.
If there’s extra we have to study from the present ESG critiques and subsequent dialogue, then we’re wanting to do this. Rome wasn’t in-built a day — we’re all marching in direction of a shared purpose. It will not be a straight line and there will likely be some curves alongside the best way. I worth an engaged dialogue round what we’re doing, and what extra will be completed. Once more, I do not shrink back from criticism. I embrace it and take into consideration what we could possibly be doing extra, otherwise or higher.
Harrison: “Sustainable investing” is a fairly broad class. How do you conceptualize company philanthropy’s function in shifting the funding business to help the transition to a clear and simply financial system?
Pompey: My view could also be controversial, however I all the time suppose I am attempting to get myself out of enterprise — attempting to work myself out of a job by way of the necessity for philanthropy. Philanthropy will all the time have a spot, however the cause I say that is that if we are able to discover methods to spend money on communities and in folks which might be offering returns, I believe it could lower the necessity for as a lot philanthropy as there may be presently.
However there may be simply a lot happening within the ESG investing house and a key concern is, after all, how do you measure it — what’s actually happening? What’s taking place because of the investments? Accountability on this house is simply so essential. And I believe that is on the core of every little thing that we do on the agency.
The opposite two issues I might say: daylight and transparency. There’s a want for fixed measurement of impression, to carry ourselves accountable and to have others maintain us accountable. We all know they are going to, as they need to.
Harrison: You’re main a handful of bold initiatives leveraging philanthropic capital to spend money on girls, slim alternative gaps for Black girls and help small companies within the U.S. May you share some highlights of the progress these initiatives have made up to now?
Pompey: I get to spend my day job speaking to entrepreneurs about shifting their enterprise and workers ahead. Consider 10,000 Small Companies as a kind of free MBA from Goldman Sachs that gives the best-in-class training on rising your corporation. We have been working this system for over a decade and we’ve graduated 12,000 entrepreneurs. Throughout the depths of the pandemic our CEO, David Solomon, referred to as me and mentioned, “I need us to go to twenty,000 small companies.” We have seen the significance of small companies, we all know they’re in want and we would like this to be delivered to twenty,000. By way of measuring impression, we all know these entrepreneurs have grown their income and for the time being, they account for about $16 billion in annual income.
We’re now 13 years into our 10,000 Girls program. We have labored with girls entrepreneurs in over 200 international locations and with the World Financial institution to launch a capital facility referred to as the Girls Financial Alternative Facility, particularly with a gender lens to present capital to girls entrepreneurs in growing international locations. Girls entrepreneurs are a tremendous credit score. And, after they develop their enterprise, they mentor a median 9 folks of their group. I consider it because the blast radius of a single lady entrepreneur.
We launched One Million Black Girls in 2021. As Malcolm X mentioned over 60 years in the past, essentially the most uncared for particular person in America is the Black lady. That also rings true, so we determined to do one thing actually totally different and never solely do a philanthropic funding of $100 million, but in addition $10 billion of stability sheet debt-and-equity funding centered on Black girls and women. It is early days, however we’re enthusiastic about the place it is going to take us and, frankly, what we’re listening to again from Black girls and women throughout the nation.
Harrison: What’s the relationship — formal or casual — between the muse’s work on local weather and sustainability and the opposite enterprise capabilities at Goldman, such because the Sustainable Finance Group, which might be engaged on the identical points?
Pompey: Possibly one of the simplest ways to explain it’s that we sit on the identical flooring. We’ve been again within the workplace over a 12 months now, and our groups sit down the hall from one another in the identical space. That is a part of constructing this muscle — the conferences within the kitchen and the shared convention rooms alike. These aren’t groups which might be working separate from each other, which I believe was by design. We need to be sure that we’re fostering the best degree of connectivity.
You’ll be able to’t have philanthropy there, ESG investing right here and local weather folks over there. It has to work collectively seamlessly, the place you are in search of alternatives and connectivity and partnerships throughout the board. That is while you actually can get a scalable mannequin. So, that kind of bodily manifestation is likely one of the methods wherein we’ve tried to make sure we make that attainable.
Harrison: Your background is (refreshingly) not that of conventional management within the finance sector. Born in Guyana, raised in Brooklyn’s housing tasks, you then supported your self by means of highschool in Japan, undergrad at Swarthmore after which Columbia Legislation Faculty in New York. How has your lived expertise formed your strategy to company philanthropy?
Pompey: Having lived all over the world, I’ve gained a stable sense of our shared humanity, which I believe has come much more to the fore over the past couple of years. Having a elementary understanding and actually seeing how rather more we have now in widespread than not, issues.
Residing in so many various components of the world is certainly one factor that informs my strategy to philanthropy. And I believe the rigor across the measurement of our impression is one other kind of capstone of my strategy to our philanthropy. The long-term funding view is completely crucial.
