Investors are increasingly hearing terms like “systems-level investing” and “transformation finance”, but what do they really mean?

​

“Systems-level investing focuses on how the interconnections between systems—financial, economic, environmental, social, and political—shape investment risks and returns,” explains Kar Mei Tang. “Instead of just considering individual investees, it looks at how broader externalities and systemic factors influence portfolios.”

​

At its core, this approach recognizes that large-scale risks, from climate change to social inequality, impact financial returns across diversified portfolios. Investors who align their strategies with the long-term resilience of the economy can better serve their clients while driving sustainable progress.

​

Kar Mei Tang is a firm believer in the power of ownership: investing with sustainable outcomes in mind will shape the future of finance. As the Regional Head of Oceania and Asia (ex-China and Japan) for the UN-supported Principles for Responsible Investment (PRI), she leads efforts to embed environmental, social, and governance (ESG) principles into global investment strategies. The PRI, founded in 2006, now has over 5,000 signatories managing more than $120 trillion in assets, all committed to responsible investment. With deep expertise spanning public policy, financial regulation, and private equity, Kar Mei serves on multiple boards, where she advocates for sustainability, equity, and inclusion.

​

Investors are catalysts for systemic change. For Kar Mei, sustainability is a fundamental economic reality that investors cannot afford to ignore. “Investors are inevitably exposed to the economic risks and opportunities of system-wide sustainability issues such as climate change, social inequity, and global health crises,” she reflects. Addressing these challenges demands rapid and significant transformation across industries: how we power our homes and businesses, how we travel, manufacture and consume goods, how we build infrastructure or support disadvantaged communities: “There is growing acceptance that we cannot continue to seek short-term financial returns at the expense of long-term sustainable outcomes. Applying an economics lens is vital to decision-making across policy, business, environment, society and cultures.”

​

Kar Mei also highlights the crucial role governments play in enabling investors to make informed, sustainable decisions: “Governments need to take a good look at the kind of disclosures they’re providing to investors. This would enable them to better assess sovereign bond risks and the economic risks inherent in their economies.”

​

The shift towards responsible investment is not just about ethics, but also about performance. Companies with strong ESG performance tend to outperform their peers over the long term, Kar Mei affirms: “Solid ESG practices are more likely to have resilient and sustainable business models, strong governance, minimal legal and reputational risks, and positive engagement with employees and customers, enhancing their long-term viability.”

​

Investors have the power to accelerate systemic change by engaging with companies and governments, enhancing stewardship practices, and driving policy shifts toward sustainability: “They must actively consider the long-term economic impacts of their investments if we are to achieve a systems-wide transition to a more sustainable economy,” Kar Mei urges. At its best, responsible investment, when supported by enabling policies, creates a virtuous cycle of positive change.

​

It seems investors have a clear choice: to remain passive or to lead the transformation. Read Kar Mei’s answers for Blooming Sustainability and remember: the future of investing isn’t just about financial returns. It’s about shaping a world where economic prosperity and sustainability go hand in hand.

​​​​

BLOOMING  Sustainability Questionnaire

Name: Kar Mei Tang

Company & Title: Regional Head of Oceania and Asia (ex-China and Japan), UN Principles for Responsible Investment

Website & LinkedIn Profile: https://www.linkedin.com/in/ktang1 ; https://www.unpri.org/about-us/about-the-pri/meet-the-team

 

* Guiding Values | Kaupapa 

A quote, personal motto or whakataukī that reflects your vision: 

“Fight for the things you care about, but do it in a way that will lead others to join you.” (Ruth Bader Ginsburg)

​

* Leading Change | Arataki

What’s the main challenge you face in driving sustainability within your sector? 

Responsible investment is a long-term commitment, you don’t see results overnight. We also understand the immediate pressures investors and policymakers are facing, like rising costs and budget constraints. But no party should say, “I’m going to do x because it’s in my immediate interest, even if it results in worse outcomes later on”. We need to seek solutions for better long-term outcomes.  

 

An Indigenous perspective you admire and want people to be mindful of: 

I really admire the concepts of kaitiakitanga (guardianship of the land, sea, and sky) and whanaungatanga (connection and shared experience). They speak to our responsibility as guardians of the environment we occupy – our plants and animals, and water and land – and also the importance of relationships and a sense of belonging.

 

Your best approach for engaging stakeholders in meaningful dialogue about ESG: 

People often see ESG from different perspectives, and we have to respect where they are coming from. We can’t go far using anger and fear as fuel; I believe we go further when we unite around a common cause that will switch the dialogue to one where we have a shared purpose.

 

What do you think is Aotearoa’s superpower in creating a sustainable future? 

Aotearoa punches above its weight in being a first mover. For example, it was the first to allow females to vote, first to enshrine sustainability principles in law, and first to legislate mandatory climate reporting. I think it is helped by the “can-do” attitude of Kiwis as well as the fact that as a small modern economy, it is in a unique position to break ahead of the pack on politically contentious policies (at the time) to demonstrate how policy can reflect changing societal expectations and really lay the groundwork for a sustainable future. I hope we will continue to see this rich tradition continue.

​

 * Surfing the Green Wave | Kakariki

If your work could plant one seed of change for the future, what would it be? 

We are at a moment in time where around the world, many investors are facing pressure to prioritize short-term demands over long-term outcomes. We need people who can see the long-term picture, and show how it can be done.  

 

The leader(s) you endorse for a future edition of Blooming Sustainability: 

Dean Hegarty

 

* One actionable takeaway for our readers to make a change today for a brighter tomorrow:

One simple but powerful action you can take today is to align your most valuable resources – whether it is time, money or labour – with your values. Are they supporting solutions or supporting the problem? Your decisions help shape the world we live in, so when we all make decisions with greater intentionality, we can drive change for good.

​