Pandemic prompts sustainable investing desire in UK, study finds

COVID-19 has prompted a desire to move into ethical and sustainable investing for more than half (51%) of advised UK adults, research from Prudential UK has found.

According to the second chapter of Prudential UK’s Family Wealth Unlocked report, 61% of advised adults now care more about the environment and the planet than they did before the pandemic.

The report, which looks at intergenerational planning and wealth transfer between advised families amid the financial volatility and insecurity of the pandemic, found that more than a quarter (26%) of respondents admit they are more concerned than they’ve ever been. The study was based on a representative sample of 1,000 advised families, and also found that one in five (21%) said they are more worried now that they have children or grandchildren.

The report also suggested the coronavirus crisis has shifted financial priorities for families, prompting more to seek financial advice. One in two (53%) respondents said they had either already sought advice – or were planning to because of the pandemic.

Prudential UK investment expert, Catriona McInally, commented: “With £5.5trn in personal wealth due to be passed to the next generation by 2047, the role intergenerational planning advice played, prior to the pandemic, was already a significant one. Yet the crisis has reframed financial priorities. Not just for those later in life with inheritance tax liabilities, but for all generations.”

Despite the desire for ethical and sustainable investing, Prudential UK stated that 36% of UK adults admitted they have no idea what their current investments – including workplace and private pensions – are invested in, as they have little to no control. 

McInally continued: “Once perhaps viewed as a fad, sustainable investing is becoming normalised, making it a fundamental building block within intergenerational financial planning. It also enables clients to leave their children more than just a financial legacy in terms of planet, environment, and society.

“With two in five advised clients surveyed confirming they expect to increase the amount they invest in ESG investments over the next five years, incorporating responsible investments into recommendations will become increasingly critical and provides advisers with an exciting opportunity.”

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