From budding trends to mature industries, Novem Group works hard to stay abreast of developing news. Here’s what caught our eyes this week:
The Dark Side of Green Energy
- Is a technology really “green” if the production of its inputs is so dirty?
- “A single electric car battery weighs about 1,000 pounds. Fabricating one requires digging up, moving, and processing more than 500,000 pounds of raw materials somewhere on the planet.”
- From an ESG standpoint, this begs a chicken-or-the-egg type of problem. If you want to make a difference do you:
- Invest in a company that screens well for ESG? These companies don’t pollute much and check the relevant boxes for social and governance related issues (ethnically diverse management team, independent board members, a product with a negligible environmental impact like software etc). OR
- Invest in a filthy mining company and drive improvement through ongoing engagement?
- I think that if you want to feel good about yourself, you do #1. If you want to actually make a difference, you do #2.
Betting with the Birds
- Getting data from the same sources as everyone else and investing with the consensus means you will never outperform.
- To generate differentiated performance, you need a different perspective and unique data.
China’s Naval Ambition knows no bounds.
- The rising influence of China’s navy is a theme we continue to follow.
- Largely unchecked by the West, China has used the distraction of the COVID-19 pandemic to accelerate the expansion of its influence. The Chinese navy is the tip of that spear.
- China has already demonstrated its lack of respect for the sovereignty of other nations in the South China Sea. As China’s navy becomes global, how can the US (peacefully) counter these efforts?