Why the school meals scandal didn’t dissuade this AA-rated ESG manager

With all the hype surrounding ESG (environmental, social, and governance) funds, what happens when a scandal arises with a portfolio company? I spoke with Matt Evans, manager of Ninety One’s UK Sustainable Equity fund, which invests in Compass Group. Earlier this year Compass was caught up in the school meals fiasco, as its subsidiary Chartwells was providing children with a meagre amount of food. This prompted a national outcry, with images of the offending parcels appearing in the national press. The criticism being that what was being provided was far below the £30 a week allowance. At the time of the fiasco, Compass represented 1.7% of Evan’s fund. I asked Evans how the asset manager reacted, as well as the UK ESG opportunities that he’s seeing over the next 12 months.