Episode 38: Promethos’ Ivka Kalus

MarketFox Interview

Ivka Kalus is a veteran of the investment management industry, having worked as a senior international equity portfolio manager for the likes of Boston Advisors, Pax World Management and State Street. She has been named among the top three female investors in the US by Citywire. In April 2019, Kalus launched Promethos Capital, a majority female-owned asset management shop that focuses on responsible investing. Why? ‘Because the market needs a firm like ours’, she says.

In this no-holds-barred interview, Kalus, who is Chief Investment Officer of Promethos, questions why people ask whether there is enough female talent to reach 30 per cent board quotas but don’t question whether there is enough male talent to fill 90 per cent of board roles, as currently is the case. She is proud to admit that while she is not a Millennial many of her opinions could be classified along those lines. And she sees ESG investing as a work in progress. Please enjoy the show.

2:20 I was trained as a biologist, but didn’t like the lab
3:40 As I went back to school to study environmental economics, the iron curtain fell
6:00 I ended up being the mining analyst at Putnam Investments
6:30 The number of women in asset management has shrunk, as has the diversity of thought
8:30 In finance a lot of people don’t understand the difference between correlation and causation
9:30 More investors are getting involved in ‘intentional capitalism’
10:00 About 1 per cent of assets is managed by women. The market needs a majority women-owned firm
12:00 How can we get more female participation in the asset management industry?
15:30 On millennials
17:00 Millennials are very serious, maybe because their experience is shaped by the Great Recession and climate change.
20:00 Using values to make unbiased decisions
23:00 Using ESG data as alpha predictors
28:00 Is progress in diversity held back because men feel threatened by women?
32:00 Diversity is one aspect of better decision making, but it needs to come with skin in the game and a mechanism for aggregating opinions rather than having one dominant opinion.
35:00 Often people ask: Are there enough experienced women to get every board to 30 per cent female? Well, are there enough experienced men to fill 90 per cent of boards?
38:00 Will Vanguard’s plan to vote again directors with more than four board positions affect female directors more than male directors?
39:00 SRI was started by religious organisations in response to the Vietnam war.
45:00 If you only exclude 10 per cent of the investment universe you can still build well-diversified investment portfolios.
47:00 How do clients determine what their values should be?
48:40 In general, we haven’t figured out the language yet for what it means to do no harm. But that is also the exciting part; we are still figuring out how alpha is generated in ESG
52:00 Building concentrated portfolios gives us the freedom not to own everything
58:00 Diversity ETFs; do they capture it?
1:01:00 What are some lessons that you had to learn the hard way?

About the [i3] Podcast

The [i3] Podcast is a conversation with some of the leading institutional investors around the world, discussing their philosophy towards investing, in particular towards portfolio construction and investment strategy. The [i3] podcast is available on iTunes, Google Podcast, Spotify, Stitcher or your favourite podcast platform.