The sustainable investing market may be generating more column inches but there is still an issue with getting people to actually invest in the market.
A recent Allianz Global Investors survey of 10,000 European consumers found only 20% have discussed sustainable investing, but 75% of respondents said sustainability aspects are important or very important to them when investing money.
Gemma Woodward, head of responsible investing at Quilter Cheviot, told International Adviser: “It is an area where you see increasing interest each year. But what happens is that there are different trends over a certain time period that people become interested in and grab their attention.
“For a lot of individuals, it is about trying to work out about how to access it and how easy is it.
“There is a lot of talk about widening the topic of impact investing but, actually, there hasn’t been a really successful market mechanism to invest in that.
“Interest is there but perhaps people look into the sector and fall into the fear pit that, if they invest ethically, then it may impact returns.”
Work to be done
Richard Pursglove, group head of distribution at Sanlam UK, told IA: “Sustainable investing and environmental, social and governance have become embedded in the day-to-day world of asset management but, in terms of taking that message to financial advisers, there is more work to do.
“With billions of pounds expected to be passed down to children and grandchildren over the next decade, we predict sustainable investment will quickly move into the mainstream.
“For financial advisers, there is a big opportunity – not only can they advise on the transfer of wealth to younger generations, they can build fruitful relationships with families across generations.”
Negative implementation correlation
The Allianz survey also found even when investments based on sustainability criteria were discussed with financial advisers, a sustainable investment was not necessarily made.
In more than a quarter of the cases (26%), respondents stated that financial advisers did not offer them a corresponding product.
In around half of cases, traditional products were offered.
“The research demonstrates that investors across Europe are very open-minded when it comes to sustainable investments and are not as concerned about performance losses,” Mathias Müller, head of retail and wholesale Europe at AllianzGI, said.
“However, there is a clear issue when it comes to implementation that needs to be addressed in order to make sustainable investing more accessible.”
