Younger clients could drive demand for sustainable investing – Prudential

More than two in five (42%) financial advisers would say younger family members have influenced their clients towards sustainable investing, new research from Prudential has found.

The study also found that almost half (47%) of advisers associate sustainable investing with sustainable living, but many say the topic has yet to be raised.

Prudential’s research, based on a study of 200 UK advisers, also highlighted concerns among advisers about shifting their client’s investment behaviours and perceptions in relation to ESG investing. It found that 67% of advisers stated getting clients to change or challenge their behaviours as they got older was difficult. Despite this, almost half (46%) agreed that clients do have an appetite for investing responsibly.

However, advisers also cited a need for more education and supportive, informative materials around the benefits of ESG investing. Prudential found that a fifth of surveyed advisers (21%) said they felt their clients saw little incentive in sustainable investing, with many suggesting there needs to be more quantifiable information provided so that both clients and advisers understand the positive impact investment decisions can have.

Prudential ESG investment expert, Catriona McInally, said that sustainable investing is starting to feature “more and more” in discussions advisers have with their clients.

“Most of us are already starting to consider how we live and the household decisions we make, such as recycling and electric vehicles, but fewer of us have grasped that perhaps one of the biggest impacts we can make is what we do with our money,” McInally commented.

“Where and how we invest is a simple way for us all to do ‘our bit’. The climate emergency, changing government policies and the increase of scrutiny on company practices has driven a desire to live more sustainably and sustainable investing is a core part of this.

McInally also suggested the pandemic has prompted a change in financial priorities, and accelerated a demand for responsible investing.

She added: “Against this backdrop of constant change, it is increasingly important that advisers are fully aware how best to meet their clients’ changing needs, as well as what resources are available to help. Our research suggests there is an appetite for advisers to know and share more about ESG investing with their clients and we’re here to help with that.”

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