Australian voters are putting their money where their mouth is

From

A growing number of Australians are directing their investments towards sustainable strategies that prioritise consideration of ESG issues.

The election surprise for many was just how influential issues such as climate change were[1].

Jessie Pettigrew, Head of ESG and Sustainability at BT, said that Australians’ interest in environmental – as well as social and governance issues – has been building momentum for some time, judging by how much money has been flowing into sustainable investments.

A growing number of Australians are directing their investments towards sustainable strategies that prioritise consideration of ESG issues. BT has seen money heading into sustainable investments grow year on year,[2] with a 44% increase across managed accounts in the March quarter alone[3].

According to the research by Responsible Investment Association of Australasia (RIAA) and co-sponsored by BT, around $1,280 billion of Australians’ money is now in sustainable investments[4].

“We are seeing momentum continue to grow in sustainability, and more and more Australians are aware of how these issues are impacting our community and livelihoods. We’re seeing money flow to investment options that can demonstrate how they’re considering issues like climate change, labour rights and biodiversity,” Ms Pettigrew said. “There are new products coming to market and we’re adding more new sustainable investment options all the time, driven by this increased demand.”

Historically, women and younger people have been more interested in sustainable investing than other demographics; however, these days almost everyone is interested, with the majority of Australians (86%) believing that it’s important for their financial adviser to ask them about their interests and values in relation to their investments[5].

“Notably, Millennials who have long been interested in sustainable investing started turning 40 last year,” Ms Pettigrew said. “And this could be why we are seeing what were once considered fringe issues become mainstream. Many of those investors are professionals with growing investment portfolios.”

———-

[1] Vote Compass survey conducted by ABC from April 11, 2022 to April 17, 2022, based on 97,159 respondents. Further information: https://www.abc.net.au/news/2022-04-22/vote-compass-federal-election-issues-data-climate-change-economy/101002116
[2] Funds under administration in sustainable investments across all BT platforms increased by 80% from March 2020 to March 2022
[3] Funds under administration in ESG managed accounts options increased from $17.5m to $25m from Dec 21 – Mar 22
[4] In 2020, 154 investment managers applied a leading approach to responsible investment, overseeing approximately $1, 281 billion in assets, Responsible Investment Benchmark Report 2021 Australiahttps://responsibleinvestment.org/resources/benchmark-report/
[5] RIAA (2020). From Values to Riches 2020 : Charting consumer expectations and demand for responsible investing in Australia, https://responsibleinvestment.org/wp-content/uploads/2020/03/From-Values-to-Riches-2020-full-report.pdf

You must be logged in to post or view comments.