ESG investment | An “s” for “security”

It is increasingly a question of security when the time comes to talk about the ESG (environmental, social and governance investment criteria), points out the ex-CEO of the National Bank Louis Vachon, also attentive observer of the military thing. Nevertheless,

Posted at 5:00 a.m. Meanwhile,

The considerable transformation of the global geopolitical portrait in recent years has undoubtedly makes the attitude of the public more favorable to spending in the defense sector. In addition, estimates the one esg investment | “s” “security” new who is today associated with JC Flowers & Co, a New York investment firm.

Politicians and restrictions have changed, he believes.

esg investment | “s” “security”

“A second“ S ”was added for“ security ”in the speeches. on the social aspect of portfolio management in Europe. In addition, North America,” says the one who was inducted as a honorary lieutenant-colonel by the Mont-Royal riflers in 2016.

The massive reinvestment of Europe, but also of Canada, in the defense made sure that we speak more of “ESSG”.

The opportunity to create a “champion” – Esg investment | &quot. s" "security" – Esg investment | "s" "security" new

Canada’s commitment to increase defense spending to 5 % of gross domestic product within 10 years is in its opinion an opportunity to develop an industrial strategy in the defense sector which will diversify the economy. Nevertheless, create “champions”.

This is an opportunity to develop a privileged supplier of military services and products, known as Louis Vachon.

“The French have Thales and Dassault. Moreover, The English have Bae and Babcock. Consequently, The Swedes have Saab. Therefore, The Germans have rheinmetall. Furthermore, The Americans have several, ”he said.

Louis Vachon also believes that Canada must build a “Defense Tech” sector. which includes a certain expertise in risk capital linked to national security issues. “And not only in military supply,” he says.

Security is not that defense, he underlines, it affects neuralgic infrastructure, cybersecurity, quantum IT, artificial intelligence and military equipment.

“Speaking to 5 % of GDP is not peanuts. It will take more than bank debt, ”says Louis Vachon.

Multiple sources of capital will esg investment | “s” “security” new be required. “Banks will play their role. The stock market too. Risk capital must play its role. The private funds esg investment | “s” “security” too, ”says Louis Vachon.

Export. Development Canada, Canada Development Bank and other organizations such as Investissement Québec, for example, will also have to contribute.

And a tax policy for the defense sector could be a good idea, he said. “It’s an old thing used during the Second World War. »»

The expansion of defense activities in Canada has been funded by setting up an accelerated depreciation program, he said.

“The companies that built new factories. bought equipment could amortize their purchases very quickly in a few years instead of doing so over 10 or 20 years. It allowed them to generate a lot of cash flow. »»

To have a sustainable defense industry at 5 % of GDP. Canada must ensure that they have local esg investment | “s” “security” suppliers. the ability to produce in the country, says Louis Vachon.

“Ideally, part of these companies must be of Canadian property and a foreign part that manufactures in the country. It is a challenge to increase the physical infrastructure. »»

The big boss of the manufacturer of landing trains Héroux-Devtek, Martin Brassard, abounds in the same direction.

We must develop financing programs that make us more competitive, he specifies.

Several sub-segments of the defense industry are already. will be of interest to the fund (CDPQ), such as the aeronautical sector and that of advanced technologies.

“Our exclusions in terms of armaments comply with the international conventions of Oslo. Ottawa. ” says spokesperson Marjaurie Côté-Boileau, adding that the submunition bombs and the anti-personnel mines are excluded from the investment perimeter.

Marjaurie Côté-Boileau recalls that the defense sector is highly regulated. called upon to grow. and that the challenges of human rights and ethics, and obviously compliance with the legal obligations of the fund, are systematically taken into account in the Diligent review processes and investment esg investment | “s” “security” new decisions.

Investissement Québec did not wish esg investment | “s” “security” to reveal the details of the directive developed to. guide its decisions in the defense sector.

“Essentially. the spirit of our interventions in the defense sector is to support companies that work directly. indirectly in the defense sector, whose activities are aligned with Canada’s strategic interests and carried out within the framework of its international alliances,” said spokesman Mathieu Rouy.

Investissement Québec intends to help diversify the economy. facilitate the integration of companies in the province in strategic supply chains within Allied economies.

Any investment linked to controversial weapons (chemical, biological, nuclear weapons, anti-personnel mines, submunition weapons, entirely autonomous systems, etc.)-and their components-and any company whose products related to defense are sold to countries that are not part of NATO. its privileged partners, esg investment | “s” “security” new however, continue to be excluded by Investment Quebec.

Mathieu Rouy underlines that the increase in military spending will generate opportunities for Quebec aerospace companies. in the naval sector. the drone sector and other telepilotic aerial systems, earthly systems, artificial intelligence, photonic optics, communications and cybersecurity.