Survey: Two-thirds of UK public want their investments aligned with the SDGs

"Greenwashing"

Published by the UK’s Department for International Development (DFID), the ‘Investing in a Better World’ survey asked more than 6,0000 UK-based adults with some form of savings or investments for their views on ethical, social and governance (ESG) issues.

Of the respondents, more than two-thirds said they want their investments to deliver positive returns for the environment (70%) and for society (75%), as well as for their wallets.

In order to ensure this, just over half of the respondents said they are looking into investing through dedicated sustainable finance offerings “immediately” or “in the near future”. Moreover, around half are planning to switch their pension fund if they find it is invested in a way which contradicts their personal ethics.

The results also showed a clear desire for businesses to lead the green finance transition; two-thirds agreed that a key purpose of financial institutions should be benefitting people and the planet, while one-third say that social and environmental sustainability are among the top five factors they consider when making investment decisions.

Nonetheless, actual uptake of dedicated ESG financial services and products was found to be low; just 13% of the survey respondents say they already invest in a way they consider to be fully aligned with the SDGs.

When asked what would help them make that alignment, respondents often cited greater availability of dedicated products and services, as well as more evidence of the proven positive impact of these funds. Indeed, less than half (46%) said they knew what responsible or impactful investment is.

Investors were also found to be deterred by the perceived or actual costs and risks of ESG-aligned products and services and by the potential of finance firms to “greenwash” them.

The report accompanying the survey warns that the UK risks not playing its part in delivering financing for the SDG agenda if these issues are not jointly addressed by businesses and policy. Globally, the cost attributed to investment in achieving the SDGs has been estimated at $2.5trn annually through 2030 – the majority of which will need to be invested in developing nations.

“The Investing in a Better World initiative demonstrates that there is widespread demand for sustainable investing from people in the UK, and this demand is expected to grow further, driven particularly by wealthier and younger people,” the report states.

“The financial sector should be prepared to respond to and meet this demand. Capitalising on the high customer demand for sustainable investing represents an opportunity to change the world for the better. With just over ten years left to meet the SDGs, the results of this work outline a vision for how we can work together to make it easier to invest in a better world.”

Abundance Investment’s co-founder and managing director Bruce Davis, who contributed to the report, added: “Rather than a narrow focus on financial returns and risk, we need regulation and incentives to encourage the creation of products that make a positive difference to both people and planet.”

The findings of the survey echo those of recent research from PwC, which assessed the decision-making processes of 347 institutional investors across the globe. It found that almost two-thirds of these actors were centring decisions around the SDG framework.

Green finance at edie’s Sustainability Leaders Forum

edie’s Sustainability Leaders Forum returns in 2020, as some of the biggest companies, individuals and organisations championing sustainability gather at the Business Design Centre on 4 & 5 February.

Green finance will be a key discussion point, with speakers including Green Finance Institute CEO Rhian Mari Thomas, M&G Investment’s head of responsible investment and ESG Anita McBain and Aviva Investors’ global head of governance Mirza Baig. 

Other keynote speakers at this flagship, multi-award-winning event features include Mary Robinson, former President of Ireland; Rebecca Marmot, Unilever CSO; Tom Szaky, TerraCycle CEO;  and Gilbert Ghostine, Firmenich CEO. For details and to register, visit: https://event.edie.net/forum/

Sarah George