Inside The Deal: Stuart McLachlan, CEO Anthesis


Palatine recently acquired a significant minority shareholding in fast growing, global sustainability specialist, Anthesis Group, a deal which underlined its long-held commitment and passion for impact investing and the broader ESG agenda.

Here, Stuart McLachlan, co-founder and CEO of Anthesis, talks about the company’s growth journey, what’s next for the business, and the wider corporate world as it addresses the challenges posed by the urgent need to tackle climate change.

He explains: “Anthesis was born out of frustration. Amid all the talk about sustainability, there was not enough action, and where there was action the failure rate was really high.

“So whether you are driven by impact, or business opportunity, there was a need to create an organisation that could respond differently to the market need, and there was a requirement to do something to address the failure rate.

“We knew we could demonstrate there was alignment between sustainability and commercial performance and sat down with a blank sheet of paper and armed with the experience we had, assembled something new to address both the market need and the planetary need.”

As Anthesis has grown – since its formation in 2013 it has made more than a dozen strategic bolt-on acquisitions – how has the business been able to retain the pioneering culture of its founders?

Stuart explains that, as a purpose-driven organisation, it’s essential that everyone shares broadly the same goals to “really turn the dial on sustainability.”

“We are clear on our mission, values, vision, strategy, culture and our brand. If you don’t buy into these non-negotiables, then Anthesis is not for you.

“We say this to new recruits and we’ll say that to the vendors of businesses we are interested in buying. We have this point of unity, but beyond that we recognise there is a huge amount of diversity, which is something that should be celebrated.

“The importance here, is having a clearly-defined and inspiring mission that people in Spain, Sweden or the Far East really want to buy in to and deliver together.”

In a fast-moving business environment where there is often a pressing need to help its blue-chip clients transform quickly, Stuart says Anthesis must be alive to new disruptive technologies and ideas to help them deliver.

“We are not a Godzilla-type of business that wants to eat up a lot of others for scale. When we are looking at an acquisition, our primary reason for that is to fulfil a strategic need because they are plugging a gap in the puzzle and they will be able to help us deliver our mission. We therefore must be close to the innovators and creators of new, disruptive technology.

“Ultimately, being at the nexus of sustainability and digital is a powerful place to play,” he says.

2021 has been a defining year for Anthesis with a number of milestones achieved, including ranking in the Fast Track 100 and 250 league tables and the FT’s 1000 Fastest Growing companies in Europe for a fourth successive year, gaining B-Corp status and, following a competitive process, the investment from Palatine. The investment will enable Anthesis to scale at pace, organically and acquisitively, across borders and disciplines, and accelerate its impact through digitisation. It has also seen Palatine partners Beth Houghton and Tristan Craddock join the Anthesis board as Non-Executive Directors.

Stuart says: “Bringing Palatine into the Anthesis journey is something we are delighted by – it’s a key event for us and will allow us to achieve our mission faster!

“I felt Palatine really listened to the needs and requirements of the management team and responded in a way that made us think they understood us and were willing to show the level of flexibility we needed.

“We also liked the people, so when we scored the different options, we put a strong weighting on the people we’d be working with and whether they’d be mission-aligned. We felt very good about Tristan and Beth.

“We have more than 600 people now, and many of them are very vocational and work for us because of the mission and impact element of what we do, and we knew they would want to know we had partnered with an investment house that would share the same values, so the Impact Fund component was important to us,” he adds.

So what of corporate life post-pandemic? Is video-conferencing the new normal for colleagues to meet? Is business travel a thing of the past?

Stuart believes many business leaders will now “think twice about jumping on a plane”, but isn’t convinced the days of office working are numbered.

“Ultimately, we are social creatures and you cannot build culture to the same extent and depth as we’d like in the environment we’ve been in through lockdown. We need places where people can collide and create ideas and solutions. I think that will be the case for many other businesses.

“However, I think the days of someone coming into an office, sticking their headphones in, writing a report and talking to nobody, are gone. I think we will meet physically where there’s demonstrable value associated with it.”

Technology is unquestionably an essential part of the solution to the sustainability challenge, Stuart states: “Anthesis wants to move the dial on sustainability during this decisive decade. But we know there isn’t enough human talent in the market place to be able to deliver what the world needs over the next 10 years.

“For us to be able to realise our ambitions, then we need to find a way of decoupling from the constraints of human talent and the way we can do that is to use digital and tech more effectively. We are always asking how we can use technology to do the heavy-lifting that humans can’t do; how we can develop software to strengthen the evidence to help clients make the right decisions.”

So what does the future hold, and is ‘greenwashing’ an issue for Anthesis?

“There’s a lot of transformational change we need to help our clients navigate, so we need to have a global platform, we need to use tech, we need to make sure we have the right expertise and plug the right expertise gaps, so there are huge opportunities for Anthesis to build on its position as the market-leading sustainability activator.

“In terms of greenwashing, we were coming up against it up to about three years ago, when a lot of activity in the market place was, to be honest, quite cosmetic.

“Then something happened three years ago – was it Blue Planet? Was it the arrival of Greta? Was it the investment community recognising the importance of ESG? A lot of things came together, and at that point what we do went from being considered mainly by CSR/ Sustainability departments to something that is mainstream in organisations.

“Clients are now saying sustainability is something potentially existential and we have to change what we do, be it in sourcing, in supply chain, manufacturing or branding. At that point it went from a dark corner of an organisation into the C-suite, and Anthesis is there to deliver this transformational change.”