A majority of female clients want their investment decisions to consider environmental, social and governance (ESG) factors even if this reduces their investment options, new research from Quilter Cheviot has found.
In a survey of around 2,000 female clients, Quilter Cheviot found that 53% agreed ESG factors should be considered compared to just 7% who disagreed.
More than two-thirds (64%) said the key reason was to have a positive impact as well as generate financial returns, while 59% want to contribute to the global need for sustainable development and 58% said improving the world for future generations was its priority. Just over a fifth (21%) want to align to the current movement to invest more responsibly.
The research also showed that more than a third (37%) want to ensure their investments are considering ESG factors as a way of mitigating risk and maximising returns.
Gemma Woodward, head of responsible investing at Quilter, said: “From speaking to our female clients, it is clear that considering ESG factors as part of the investment process is becoming the norm. We are reaching a point where investors expect it to be done as standard as it is simply just good practice and prudent management of money. While a large minority have no view on the matter, the fact so few do not want ESG factors considered gives an indication of the sort of conversations female investors are wanting to have with their advisers and investment managers.”
Woodward said it was “pleasing” to see that a significant number of female investors also consider ESG factors as about risk mitigation and not necessarily investing sustainably.
Woodward added: “We have seen the terminology around this area be used quite lazily by the industry and this has led to confusion and misunderstandings when it comes to investment performance and expectations. However, it is clear that we are seeing some cut through on what ESG is and we now need to build on this, particularly in light of upcoming regulations.
“The data has also made it clear that many female investors have set out with some very noble intentions and want their money to help deliver positive change for the world and future generations. While financial returns will more often than not remain the primary objective of a client, it is imperative that secondary objectives are known and understood as investors want to do more with their money.”
