British investors are most likely to identify as Moderate Greens as interest in sustainable investments soars

The UK’s largest ever survey on sustainable investing – “The Great British Sustainable Savers Census” – conducted by Boring Money and sponsored by Aberdeen Standard Investments, in September 2020 with 6,000 UK adults, has found that interest has soared to an all-time high, led by an emerging cohort of ‘Moderate Greens’.

The research identified 6 core groups of consumers when it comes to putting our money to work.

Although returns remain the priority for most, 25% of investors reported that sustainability was a more important consideration for them than financial ones. Amongst investors:

  • The largest group were the Moderate Greens, accounting for 37% of investors, who prioritise performance but also care about protecting the environment. It’s still a performance story for these 5.8 million investors but the environment is an important consideration as is having a positive impact.
  • Future Focus is the next largest group, accounting for 14% of investors. For this group, ensuring their investments reflect their sustainable values is more important than performance, driven by a desire to invest in a way that makes a positive environmental and social impact, and wanting to invest in companies that aim to do better.

Boring Money MD Holly Mackay comments, “One of the biggest changes I have seen over 12 months is the rapid expansion to a more encompassing view of sustainability. Last year the story was very much about the environment. The ‘Greta effect’ was everywhere. Today we see more focus on the social elements of sustainability – treating people well. Brands with poor reputations around supply chains and staff management are villainised. Fast fashion has become the new oil.”

Age plays a part in determining which segment people fall into.

  • Eco Warriors are the youngest segment – 78% of all Eco Warriors, including savers and investors, are under 55. This segment prioritises sustainability, and they are mostly driven by a desire to protect the environment.
  • Pure returns are the oldest segment – 55%, including savers and investors, are under 55. This group prioritise performance and would only want to invest in a way that focussed on returns.

The research also challenges the decision by some robo advisers, platforms and others to label a more generalist approach as ‘Ethical’. This description is the most likely to have a negative impact, particularly with a younger audience. Just 19% of the smallest ‘No Nasties’ segment is under 35.

Boring Money worked with research partner Morningstar to map investment funds to each consumer profile.

Morningstar, Director, Sustainability Research, EMEA and APAC, Hortense Bioy comments, “Investors increasingly need simple tools and language to understand the complex topic of sustainable investing. This project with Boring Money enabled us to look from the consumer perspective and develop a clear pathway for people to identify and select funds that are most in line with their sustainability preferences and values”.

Moderate Greens could look to the following funds to find their perfect match:

  • Royal London Sustainable Leaders Trust
  • UBS ETF - MSCI EMU Socially Responsible UCITS ETF
  • ASI UK Responsible Equity Fund
  • Janus Henderson Global Sustainable Equity Fund
  • Pictet - Global Environmental Opportunities

 

Notes to Editors:

1. Source: “The Great British Sustainable Savers Census” report, published by Boring Money in September 2020 and sponsored by Aberdeen Standard Investments.

2. Statistics come from a nationally representative survey conducted online with 4,073 UK adults aged 18+ in August 2020. Investors are defined as those who say they hold a stocks and shares ISA, personal pension/SIPP, or general investment account (excluding workplace pensions).

3. Segmentation sizing for savers and investors:

Market split

 

4. Recommended funds per segment:

Segment

Recommended funds (based on Morningstar research)

Eco warrior

·         iShares Global Clean Energy UCITS ETF

·         Pictet - Global Environmental Opportunities

·         Multipartner SICAV - RobecoSAM Smart Energy Fund

Future focus

·         Royal London Sustainable Diversified Trust

·         Pictet - Global Environmental Opportunities

·         iShares MSCI USA SRI UCITS ETF

Moderate greens

·         Royal London Sustainable Leaders Trust

·         UBS ETF - MSCI EMU Socially Responsible UCITS ETF

·         ASI UK Responsible Equity Fund

·         Janus Henderson Global Sustainable Equity Fund

·         Pictet - Global Environmental Opportunities

Diligent savers

·         iShares MSCI Europe SRI UCITS ETF

·         AXA World Funds - Global Factors - Sustainable Equity

·         Stewart Investors Global Emerging Markets Sustainability Fund

·         UBS (Irl) ETF plc - MSCI United Kingdom IMI Socially Responsible UCITS ETF

No nasties

·         iShares MSCI USA SRI UCITS ETF

·         Janus Henderson UK Responsible Income Fund

·         BMO Responsible Global Equity Fund

·         ASI Europe ex UK Ethical Equity Fund

Pure returns

·         Royal London Sustainable Diversified Trust

·         UBS ETF - MSCI EMU Socially Responsible UCITS ETF

·         AXA World Funds - Global Factors - Sustainable Equity

·         ASI UK Responsible Equity Fund

·         UBS ETF - Bloomberg Barclays MSCI US Liquid Corporates Sustainable UCITS ETF

 

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