Younger generations are more likely to invest responsibly than their older counterparts, new research from BMO Global Asset Management has shown. But are they ‘greener’?
The findings showed that more than one in ten (11%) people aged between 18 and 34 years old have chosen to invest in funds or companies looking to make a positive impact over the past 12 months. In contrast, just 2% of those aged 55 and over have done the same.
According to BMO, responsible investing has grown increasingly popular among the UK’s Gen Z and Millennial investors, with over half (57%) of investors aged 18-34 now making investment decisions to help achieve a more sustainable future.
While the sustainable investing trend has also gathered pace among older investors, only one in five (19%) over-55s is using their investments to achieve a more sustainable future.
However, the research also showed that while older generations are less inclined to use their money for sustainable purposes, they are outdoing younger generations with their green day-to-day habits. Over three quarters (76%) of adults aged 55 and over have started using their own shopping bags when shopping, while 71% have reduced their food waste and almost half (47%) have started sourcing locally wherever possible.
Ross Duncton, managing director, head of direct, BMO, said: “The UK’s younger investors have been quick to embrace responsible investing, as they put their money towards building a better future for themselves, but also generations to come.
“While older age groups have made significant progress in the past 12 months when it comes to living a more sustainable lifestyle, their ‘green’ lifestyle habits are yet to translate into their financial habits in the same way it has for the younger generations, meaning they’re potentially missing a trick.”
Duncton added: “The investment potential of this age group is sizeable. As a responsibly minded generation, this generation should be emboldened by the knowledge that their savings and investments have the potential to drive long-term and meaningful change. Investing responsibly need not require hours of meticulous research into individual companies and their sustainability credentials. Simply choosing to invest through funds with managers that are actively helping companies to become more sustainable, can ensure your money is being used to make a positive difference.”