Schroders Shines Light On Which Investors Value Sustainability The Most

Editorial Staff 21 October 2022

Schroders Shines Light On Which Investors Value Sustainability The Most

The survey claims that investors deemed "advanced" and "expert" are more likely to embrace the case for sustainable investing in their overall approach. But it also shows that results – increasingly important in an inflationary world – are paramount for most investors in Asia, and the wider world.

“Expert/Advanced” investors in Southeast Asia are more likely to believe that investing sustainably is key to driving long-term returns compared with people who rate themselves as less knowledgeable, a survey by Schroders has found.

The firm’s study, which included views from in Malaysia, Singapore and Thailand, found that 72 per cent of people thinking of themselves as being “expert/advanced” in their investment knowledge think that sustainable management of money is the “only way” to ensure long-term profitability.

The findings are included in the Global Investor Study 2022. Between 18 February and 7 April 2022, Schroders polled almost 24,000 people who invest from 33 locations globally. This research, which spanned countries across Europe, Asia, the Americas and more, defined investors as those who will be investing at least €10,000 ($9,775) and who, in the next 12 months, would have made changes to their investments within the last 10 years.

Among the overall global sample, 68 per cent of such investors think that sustainable investing produces long-term profits.

A focus on delivering financial returns, unsurprisingly, still remains a priority for many investors. More than half (63 per cent versus 56 per cent globally) seek a fund that focuses primarily on delivering financial returns while integrating sustainability factors. That is particularly the case for people in Asia (61 per cent) and the Americas (60 per cent), while investors in Europe were more likely to choose a fund with sustainability characteristics (51 per cent).

Some 60 per cent of “intermediate” investors in Southeast Asia (versus 52 per cent globally) and 62 per cent of those who believe they have “beginner/rudimentary” investment knowledge (versus 43 per cent globally) think sustainability is important than returns. 

Some 72 per cent of “expert/advanced” Asia-Pacific investors (similar to 69 per cent globally) share the view that investing sustainably can support positive change when it comes to considerations such as climate change, the survey said.

“The interaction between sustainability and returns has seen some polarising results this year. While beginner investors appear more sceptical, the majority of Southeast Asian [investors] believe sustainability is crucial to delivering long-term returns,” Hannah Simons, head of sustainability strategy at Schroders, said. 

“This is encouraging to see and further emphasises the crucial role asset managers have to play in terms of helping investors better understand how investing sustainably can not only help overcome challenges such as climate change, but also support their long-term returns. Indeed, we see an intrinsic link between long-term sustainable investment returns and solving some of the world’s social and environmental challenges.”

Environmental impact was found to be the main reason why people are attracted to sustainability investing (58 per cent in Southeast Asia versus 52 per cent globally). Societal principles came second at 44 per cent (versus 43 per cent globally), and financial gains ranked third in Southeast Asian investors’ list of priorities (37 per cent in Southeast Asia and 36 per cent globally).

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