After a world ravaged by Covid-19 during the course of 2020 and 2021, with most of us having endured a lockdown of some sort or another, we were cautiously optimistic about 2022. Now that we are nearing the end of 2022 it would seem that our optimism about a rosy year was rather short-lived. Conflict continues to escalate in various countries around the world, and the climate crisis is as much of a concern as it has ever been, if not more so, with serious water and food shortages around the globe continuing to put pressure on daily life for many. Monitoring and Communication For most of our clients, the main impact of these pressures has seemingly been confined to the value of the assets we hold for their benefit. As trustee, we are very aware of the assets that we administer and the effect that a turbulent world with high market volatility has on those assets. After all it is our duty as trustee to preserve and enhance the value of the trust assets in our care; inflation alone is rapidly eroding even the most cautious of assets. Regular communication and consultation with the appointed asset managers regarding the performance of an investment portfolio, or property managers in respect of tenants and tenancies, has always been an important part of meeting this duty and never more so when the normal order has been replaced with chaos. Increased Use of Technology Throughout the 20th and early 21st century, trustees were often found travelling the globe to see beneficiaries and intermediaries. During 2020 and 2021, the Covid-19 pandemic brought travelling to an abrupt halt and we were forced to embrace technology. Never before have we seen such advances in technology with regard to asset management, reporting and video conferencing. Skype, Zoom, Teams, all allowed us to monitor and manage assets, and attend meetings around the world when the pandemic prevented us from doing so. What has become apparent over time however, is the importance of conversations we have with families over a cup of coffee or meal after the scheduled meetings. It is often once the agenda has fallen away that families relax and talk about the things that they don’t realise are important pieces of information for a trustee. So it is understandable that 2022 has seen a rush by many to return to in person meetings. But how does that sit in a world that is trying to become carbon neutral? Undoubtedly the environment received a benefit from reduced travel during the pandemic. There were fewer planes in the sky and less traffic on the road which meant less pollution. In the face of a global commitment to protect our planet, we have to strike a balance with our duties to the families we work with. In 2023 we will therefore likely see a mixture of face-to-face and e-meetings. The ease of e-meetings enables more frequent and ad-hoc engagement thereby improving communication, however they do not replace the intangible benefits gained from in person dialogue. Both have their place in our future and that of the trusts and families that we look after, and we will all benefit from the greater access to, and use of online reporting and asset management. Impact Investing In 2022 we have seen many of the families that we work with, across the generations, asking us to consider ESG, impact investing and philanthropy, in part at least driven by the fall out of the Covid-19 pandemic and the intensification of the challenges faced by society worldwide. Impact investing, a form of sustainable investing, seeks to generate positive, measurable social and/or environmental impact alongside financial return. The risks can be higher but with greater rewards which extend beyond financial return. Philanthropy sits at other end of the sustainability spectrum, as there is no desire to generate a financial return from the deployment of capital, capital which is intended to serve a purpose for betterment only. We have seen increasing numbers of requests to consider the assistance of trust assets to do something positive in a community that could otherwise not afford to do so themselves. On a recent trip to Kenya, we had the privilege of visiting various charities with one of our clients whose family feels very strongly about making a difference in the community that they grew up in as well as internationally. This really brought home the harsh effects of living in impoverished communities where access to water is not a given. For example, drilling a borehole, providing a solar power array to power the pump and ultimately provide a village with running water so that the women and children don’t have to walk 40 kilometres a day to water their animals and bring water back to their villages. By providing them with water, the village can plant crops and the children can have an education and a future. As trustee, we have the privilege of being able to assist the families we work with in their endeavours to make the world a better place. And in 2023…? As we head in to 2023, we believe that market turbulence will persist, requiring ongoing scrutiny of the assets we hold as to value and suitability, the balancing act of in person versus virtual meetings will continue, and we are likely to see an increasing number of requests to consider impact investing and philanthropy, as the families that we work with try to do their bit in caring for our environment. It’s just another year in the life of a trustee!
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