UK investors expecting fund managers to show sustainability proficiency

New investors are expecting greater sustainability expertise from fund managers, a study from Triodos Bank has indicated.

The research, which polled UK investors, revealed that 83% would expect to see their fund manager upskilling in sustainability and environmental issues, while 85% would like their fund manager to help avoid “greenwashing” claims from financial providers.

For new investors, the study found this to be even more important, rising to 91% among those that had started investing in the past 12 months for both responses.

New investors are also demanding more detailed analysis of the funds they invest in, with 90% wanting their fund manager to conduct in-depth research into each company in a fund, to make sure every single investment aligns with their values and personal ESG criteria.

CEO of Triodos Bank UK, Bevis Watts, commented: “Our research demonstrates that the majority of investors are looking for active stewardship from their investment managers, with the peace of mind and expertise that passive funds just can’t provide.

“A generational shift in expectations is clearly happening, which has the potential to disrupt the investment management industry.”

The research, based on a study of 1,004 UK investors, also indicated that the past year has seen a new generation of purpose-led investors come to financial providers with a greater expectation of sustainable and impact investing.

Almost half (48%) of these new investors are under 35 years of age, while three-quarters (75%) are under 45, indicating that positive social and environmental impact is a greater priority for younger consumers starting their investment journey.

“A new generation of investors are demanding more from fund managers and financial providers in terms of sustainability – and rightly so,” added Triodos Investment Management managing director, Hadewych Kuiper.

“With an increasingly complex sustainable investment landscape, fund managers can play a vital role in helping to separate dubious greenwashing claims from those that truly benefit the planet.

“To meet this consumer demand for impact and transparency, investment managers need to ensure they are staying up to date with the latest products, research and policy developments in sustainability. Only then will investors be able to trust that their money is really being invested in line with their values.”

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