Finance drives environmental change and Lana Baker-Cowling, sustainable finance and ESG strategy consultant at Anthesis, is optimistic it will deliver.
What attracted you to a career in sustainable finance?
I was driven by finding a purpose greater than myself. I wanted to do something that would have a positive impact on the world in some way. I wanted to help find a solution to the climate crisis. Once I started working in the corporate world, I saw that financial considerations were integrated into every possible decision, which was a key lever for driving any large-scale change.
What was your route?
I graduated from UCL with a first-class honours degree in geography in 2021 and my first job was in renewable energy, where I learned how capital allocation shapes what can be done to support the zero-carbon transition. In February 2022, I joined Oslo-based climate consultancy Carbon Limits, primarily working with public development institutions, and saw the reliance on international financial institution funding to drive change. I wanted to explore that link, to understand how investors and financial institutions factor environmental, social and governance (ESG) considerations into investment strategies. An opportunity came up to join Anthesis and work with private equity clients on responsible investment programmes, pre-, during and post-transaction. I joined as a junior ESG strategy consultant in December 2022.
What is your role at Anthesis?
I sit within the transaction and sustainable finance team, which is part of Anthesis’s wider ESG advisory and mandatory reporting offering. I predominantly work with mid-market private equity clients and their portfolio companies, project managing and delivering due diligence and sustainability reports, as well as risk and materiality assessments. I align companies with regulatory frameworks such as the Sustainable Finance Disclosure Regulation or Task Force on Climate-related Financial Disclosures; I also provide training for deal teams.
What due diligence do you undertake on a deal?
At pre-investment, we carry out a red-flag screening of material ESG topics relevant to a target’s sector and the general partner’s investment thesis. These include carbon emissions, waste management, labour practices, employee welfare, human rights, supply chain management, bribery and corruption, regulatory compliance and governance. We identify where the company currently sits, note any red flags and identify opportunities for value creation, from a short- to long- term basis. There is a tendency to focus on ESG risks, but the identification of ESG opportunities is central to driving value. Some businesses have real potential to differentiate themselves through innovation, operational efficiencies or better positioning for regulatory changes. We work within the wider due diligence process, alongside legal and commercial due diligence.
What are the challenges and opportunities for private equity?
We need to keep encouraging and engaging with the investment community as it plays a key role in driving sustainable change, whether that’s scaling up investment in new solutions or services, such as cleantech, or investing in businesses that contribute to positive environmental or social outcomes.
An ongoing challenge is balancing the sustainability agenda against broader macroeconomic factors such as inflation, cost of debt or market volatility, and ensuring ESG receives the recognition and prioritisation it deserves. ESG teams can be lean and juggle multiple demands, so being able to demonstrate how ESG activities can drive long-term change and contribute to value creation is key. This is particularly important in private equity when the typical ownership period is four to five years. Education on material topics, such as supply chains, decarbonisation and human rights, helps to set expectations, encourage collaboration and secure internal buy-in.
What are your future aspirations?
I want to continue working at the intersection between sustainability and finance. Climate is very topical and nature is gaining momentum, but I also want to further explore the social elements of sustainability. I’d like to see sustainable finance and responsible investing become the norm. Ten years ago, conversations centred around what responsible investing was; now, we’re discussing how to measure and quantify the impact of ESG activities within value creation. We’ve come a long way. There’s still a lot to be done, but I am optimistic.
