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BY KATIE - MYGREENPOD, 13 Oct '17
8/10 UK investors want to see a fairer and more sustainable society
UK investors want to use their money to create positive social and environmental change by investing in progressive and pioneering businesses. Still, while demand for positive investments is growing, two-thirds (67%) of investors have never been offered ethical or sustainable investment opportunities.
These findings, from the Impact Investing survey by Triodos Bank UK, were released in Good Money Week (08-14 October 2017), the national campaign to raise awareness of sustainable, responsible and ethical finance.
The survey reveals a widespread desire for change, with eight out of 10 (79%) investors saying they want to see a fairer and more sustainable society.
The results suggest most believe business, not government, has the answers. Over half (55%) of the respondents say businesses have the power to solve many of the biggest challenges the world faces today, and three-quarters (71%) say businesses have the power to create positive social and environmental change.
By contrast, half of those surveyed (50%) say the government seems powerless to change society for the better – a figure that rises to 60% among the over-55s.
‘Our survey shows that an overwhelming majority of UK investors increasingly recognise the power of money to be a powerful tool for change. They know they can exert a positive influence on our wider society by simply channelling their investments into things that benefit not only themselves but also the world around them. They are looking for investment opportunities that allow them to support pioneering and innovative companies making a positive difference, while receiving good long-term returns.’
Managing director of Triodos Bank UK
Triodos Bank offers two award-winning Socially Responsible Investment (SRI) funds in the UK: the Triodos Sustainable Pioneer fund and the Triodos Sustainable Equity fund.
The Triodos Sustainable Pioneer fund is a global equities fund investing in small and medium-sized listed companies that are focused on the sustainable themes of climate protection, healthy living and clean planet, or are pioneers in corporate social responsibility. Examples include wind turbine manufacturer Vestas, medical equipment manufacturer Smith & Nephew and electric car manufacturer Tesla Motors.
The year-to-date performance of the funds show strong results, with both the Triodos Sustainable Equity fund and the Triodos Sustainable Pioneer fund outperforming the benchmark of their investment classes.
A growing market
The Socially Responsible Investment (SRI) retail market is now worth over £16 billion in the UK, up from £6 billion in 2010.
Although the market is buoyant, and ethical funds have been shown to outperform mainstream investments, 67% of investors surveyed have not been offered sustainable and ethical investment opportunities, and 54% would not know where to go to find out about them.
Click here to find out why Triodos Ethical Savings Accounts are a MyGreenPod.com Hero
‘While it’s encouraging to see further evidence of the growing demand for sustainable and responsible investment opportunities, the fact that two-thirds of investors have never been offered them suggests a worrying disconnect.
‘The market is growing at pace but it seems intermediaries are not keeping up. Funds that uphold environmental, social and governance standards are now outperforming those that don’t by a significant margin, yet for some reason the majority of IFAs are not actively promoting ethical funds. The positive investment market could grow significantly if financial advisers were more familiar with the range of sustainable investment funds on offer, such as the Triodos Equity Fund.’
Director of independent investment advisers 3D Investing
Where’s our money actually invested?
While many investors recognise the risk associated with investing in companies that damage society and the environment, with 42% saying they will not be successful in the long term, over half (56%) don’t know which companies or industries are included in their investment funds or pension.
‘Until recently, I never thought to ask what my savings are being used for. When I learned that most banks invest in fossil fuels and other things I don’t want my money to support, my wife and I decided to look for alternatives. We wanted our savings to be invested ethically and to support innovative businesses. I did some research and found Triodos offered a unique type of ethical banking, one that screens positively to rule out the risk of investing in arms or fossil fuels. So we chose to move our savings into two Stocks and Shares ISAs offered by Triodos.’
Triodos Bank SRI customer
Eight out of 10 respondents (81%) say banks and other financial institutions should be more transparent about where people’s money goes, and 68% would like to have more knowledge and transparency about where their money is invested.
‘Investors have a right to know how their money is being used. We want people to really think about what their bank or financial provider is doing with their money. At Triodos Bank we offer complete transparency and believe other financial institutions should – and will – follow suit. We encourage all investors to think about and ask where their money goes and make a conscious decision to invest in companies that are good for people and planet – as well as providing a financial return.’
Managing director of Triodos Bank UK