What are your other areas of research?

We have a larger project at the Massachusets Institute of Technology, MIT, which looks at how corporate sustainability is measured by rating agencies. We also have a project researching whether investors are sensitive to how large an impact a sustainable investment makes. For example, if one product prescribes planting ten trees while another wants to plant 10,000, do investors perceive the difference? And are they prepared to pay more for the latter?

«Ultimately, we want to promote sustainable development»

Or are people simply happy to «tick the box» on sustainability, and aren't particularly sensitive to the extent of a particular product's impact? If the latter is true, then the communication around it has to be altered for people to understand which products have a larger impact. Ultimately, we want to promote sustainable development.

That's why you also help educate private bankers, as well as wealthy individuals. How is that received?

They are extremely thankful for a safe framework to express themselves openly and honestly on the topic. Their employers also appreciate it: I always thought banks prefer to conduct these types of training in-house, but that's not always the case.

«The breadth of sustainability is an advantage – and a drawback»

The alumni of our programs for investors in particular end up sending their bankers to the course, in order to better address the sustainability interests of their clientele. Our courses for private bankers are intentionally only two days and structured very efficiently – advisers often don't have a lot of time. This exchange and communication are valued.

Is that the key point?

Precisely. It's most frequently about how we discuss these topics. The advantage and drawback of sustainability is its vastness. If we take the 17 UN sustainable development goals, various people are more or less interested in each of them. Each topic warrants its own Ph.D. This means the topic of sustainability is very broad – but also has considerable depth. As a result, there's a lot of uncertainty about how as an adviser – or someone from a wealthy family – should communicate.

It can become a communicative minefield in a client meeting.

Exactly, we also explain in our program that there are certain toxic terms. Many people, particularly older clients, can respond unfavorably to certain terminology, sometimes even to words like «sustainability».

Because they feel attacked?

For example. Some terms are politically tinged: «climate change» in the U.S., for example. We often see younger people relate that they have to work with older colleagues who don't believe in climate change – that leads to a lot of discussion in our courses. We tell advisers and people from wealthy families in these cases that they can't refer to climate change, but to things like clean air or future-based technologies instead. They should also think about what facets of sustainability are relevant for their counterpart – everyone has one topic they care about in this aspect. 

Falko Paetzold is the founder and managing director of the Center for Sustainable Finance and Private Wealth at the University of Zurich, which is devoted to shifting global private wealth into sustainable development. Paetzold previously worked for Swiss private bank Vontobel, at Harvard University's Sloan School of Management, and MIT.