Today’s youth have grown up on a steady diet of environmentalism and social activism. They are also fearless entrepreneurs when given the chance. Does that make them impact investing natives? Greenhill Capital’s Matejo Kempenaers certainly thinks so.
CV
- President and head of business relations at Greenhill Capital, Leuven, Belgium
- Masters student in Engineering at KU Leuven (graduates July 2024)
- Intern Product Analyst at Corilus
- Former member of Business Relations Committee, Ekonomika
Matejo Kempenaers’ journey began a few years back when a friend introduced him to the student investment club, Greenhill Capital, whose mantra is to explore the fun side of the finance world and sustainable investing with its growing community of young investors.
Not knowing much about investing beforehand was no problem, he says, because Greenhill welcomes all-comers as one its founding principles: “Little did I know that those first steps would become such a significant part of my student life, and I’m very grateful for it,” he says.
But the time will be ultimately well invested because the labour market is hard on graduates armed with little more than a diploma and big hopes. The latest youth unemployment figures back this up, averaging 14.2% across the EU, compared to 6% overall. Relatively good performances in Germany (5.6%) and Czechia (8.5%) flatter the results in Spain (26.8%), Greece (22.5%), and Italy (22.0%).
The problem is not limited to joblessness and the burden on public services. On average, 11.7% of European youngsters between 15 and 29 are not in any form of employment, education or training (NEETs). Although that rate is trending down, the EU target is to reach sub-9% by 2030.
Young people are changing jobs more often, according to Eurostat, and it takes them longer to “get established on the labour market”. This sheds light on why the EU declared 2022 the European Year of Youth and explains the main focus points in its current Youth Strategy.
Kempenaers is more upbeat, though. The students he knows are hyper-aware of the problems the planet faces but as “impact natives” they are keen to carry the baton towards a more inclusive and sustainable future. They embrace learning from seasoned professionals in what he calls a blend of experience and innovation for a “truly impactful investment landscape”.
Kempenaers, a 21-year old from Belgium, talks to Impact Investor about the values of young investors, and why seasoned impact professionals can learn a thing or two about their mindset.
Christian Nielsen (CN): What is the origin of Greenhill Capital and its main mission?
Matejo Kempenaers (MK): Greenhill Capital was created in 2016 as a response to the increasing demand for accessible investing education for students. While exclusive investment clubs were already a thing, two former KU Leuven students, Arne Kerst and Arnoud Wellens, pioneered the idea of an open investment association. There is no selection process and any student can become a member regardless of their experience or background. This format has proven to be very successful, as we currently have over 750 members with more than 25 different study backgrounds in Leuven.
Our main mission has remained the same since the start – to bring together and guide students with a shared interest in sustainable investing. We’re aiming to be the most accessible and educational point of contact in Leuven for all subjects related to investing.
CN: Do you have a thesis for purpose-driven investing, and do you think young people are inherently more aware of environmental, social and governance (ESG) issues than older generations?
MK: We certainly do. Our investment strategy includes a sustainability component with three pillars. First, we’ve got the MSCI ESG investing ratings that combine all three components into one score. Some argue this is misleading because a company like Shell can then score higher than, say, Tesla. As our second pillar, we steer clear of companies on the Norges Bank exclusion list for ethical reasons. Recently, we also introduced a third pillar based on our own KPIs, to tackle the shortcomings of the first two. For each company in our portfolio, members evaluate the company’s ESG reporting and assess how well they’re doing on their own sustainable investing goals.
Yes, I feel as though impact investing has become quite standard for younger people. Concepts like ESG are making their way into school curricula, and I’m pretty sure that every youth investment club in Leuven works with exclusion lists and ESG frameworks. While our influence on the big wealth pool of older generations may be small due to our limited financial resources, youngsters’ commitment to impact investing is set to catalyse substantial change in financial markets in coming years.
CN: What does Greenhill do to promote youth investing and general awareness of impact investing?
MK: Every year, we organise large youth investing events to introduce Greenhill Capital and get a taste of what investing is all about. At the start of each semester, anyone can become a member by investing €400 in our shared portfolio, which is currently valued at around €300,000. To teach our members about investing and manage our portfolio, we organise weekly work sessions during which they analyse and present investment proposals. We also make sure that our three pillars are actively discussed and that members understand the environmental and social impact of their investment.
An example of one of our impactful investments is Weyerhaeuser, which manages over 100,000 km² of forests in the US and Canada. Not only has it been achieving solid returns, but it is also actively trying to engrave sustainability in its way of doing business. They’ve won multiple integrity, diversity and sustainability awards since 2009, long before ESG was as big as it is today.
We also organise at least one event each year where we invite an expert to dive deeper into impact investing or ESG guidelines. This year, we’re hosting a debate about the credibility of ESG scores and dangers of greenwashing.
CN: Got any tips for young investors entering the impact field and/or in general? How about one or two for the older folks?
MK: For young investors, my key tip is to start by defining your values. Understand what issues matter to you and align your investments accordingly. It’s not just about the financial returns, but also the positive change you want to see in the world. Educate yourself on the companies you invest in, look beyond the numbers, and make sure to delve into their ESG practices.
For the seasoned professionals, my advice would be to shake off the ‘this is how we’ve always done it’ mindset. Embrace the new and mingle with the young minds. It’s a chance to blend experience with innovation for a truly impactful investment landscape.
