Mazars Quarterly Economic Outlook Q1 2022: Sustainomics and a world without QE

by | Jan 21, 2022

Mazars has recently published its Quarterly Economic Outlook for Q1 2022, looking at Sustainomics, a new era of ‘sustainability’ and the top three things for investors to look out for. Below, are the key highlights from the report:

Defining ‘Sustainomics’

  • Sustainomics is defined as “a transdisciplinary, integrative, comprehensive, balanced, heuristic and practical framework for making development more sustainable.”
  • Mazars believes that Sustainomics are a case of undeniable long-term benefits, which come with high and not necessarily quantifiable short-term costs. Sustainability is about turning a generation of ‘consumers’ into a generation of ‘caretakers’
  • It is also about forcing money into research that will, in all urgency and haste, replace traditional power sources with new and cleaner ones.



  • Mazars believes that a new ‘era of sustainability’ can be divided into two phases:
    • Phase 1, 2023-2030/35 – A medium-term five to ten years, where we transition away from fossil fuels and a ‘winner takes all’ economic model, to a cleaner environment and more ‘equitable’ growth. In this phase we should expect slower growth, more state, sector rotation, higher inflation, and less central banks.
    • Phase 2, beyond 2033 – By phase 2 hopefully these goals will have been attained, this is the economic environment Mazars would expect the next few years to look like, all other things being equal, from a sustainability perspective. In phase 2 we should see new portfolios for the new environment with Investors no longer being penalised for investing in ESG investments.
  • The ESG framework model for global corporations will lead to medium-long term supply chain pressures on prices. This means that central banks will have to pass the responsibility around growth back to governments, as they will be restrained by debt limits and inflationary pressures.
  • On central banks: Central Banks are currently facing a struggle to control inflation as a result of the pandemic, which is expected to dictate economic policy well into 2022. They will, however, remain independent. That independence, which is politically granted, will undoubtedly come under scrutiny if inflation runs unchecked. This independence is already being compromised by political pressures from governments.


Three things investors should look out for

  • 1) Sustainability is a juggernaut. It is not just the theme of the year, but possibly of the decade. Governments and private investors will increasingly require proof that a company is ‘doing good’, not just for ethical purposes but for fear that the cost of not participating in the zeitgeist might be too big. It is no exaggeration to say that the sheer amount of money institutionally directed towards ESG, not to mention the wall of regulations, are enough to render most other investment themes peripheral to the sustainability juggernaut.
  • 2) Things will be different when the US joins. American reluctance has held back a lot of institutional money that would have been directed to its market. When – not if but when – the US joins them, we believe that returns, especially in the beginning, could be significant for investors of all classes.
  • 3) Trust your manager. ESG scoring is weak, and we expect changes in the framework sooner rather than later. This means that, for the time being, active managers and good fund selectors have an edge on picking investments with a true ESG compass. Those companies will, in all probability, not lose investment support when ESG frameworks are updated. Conversely, passive ESG investing could suffer when companies that may have less robust frameworks are downgraded. 


Sustainomics are comprised of long-term benefits, however businesses and investors must be cautious. Long term benefits are more about making sure growth is ‘sustainable’ than they are about seeking growth at all costs. This is a major departure from past trends. In history, ‘breakpoints’ are single points in a cycle that completely change its dynamic. If they are positive in nature, like a technological breakthrough, growth rates pick up significantly.

The economic upheaval of previous historical ‘breakpoint’ events such as the Second World War will not be emulated in Sustainomics as we are preparing for an event (climate change) that has not happened yet.  As a result, we don’t expect to see the kind of ‘creative disruption’ reserved for history’s pivotal points.

As investors, we should at the very least be prepared and positioned for more market volatility and different patterns for asset returns as we are entering what is promising to be another exciting year.

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