Sustainable investing
We believe that delivering the best investment outcomes for our clients over the long term depends on securing a prosperous and sustainable future.
By net zero, we mean achieving a balance between the amount of greenhouse gas emissions that we put into the atmosphere and the amount removed from the atmosphere, net zero being achieved when the amount added is no more than the amount taken away. This in turn would stabilise global temperatures and address climate change.
What impact, if any, did COP26 have on how investors think about their wealth and whether they are prepared to adapt their investment approach to play their part?
Are returns, at any cost, still the main priority for end investors? How well do they understand the need to act and invest sustainably and are they willing to pay for returns beyond profit?
Ninety One commissioned the second edition of the Planetary Pulse survey to find out. We asked investors what it means to allocate capital towards the net-zero transition both before and after the COP26 summit.
- Our survey revealed that achieving net zero emission and climate change is important to investors. 57% of all investors have investments with a focus on net zero or other environmental and societal benefits and the majority (67%) are in them for the long term (5 years or more).
- But it’s not just those who already have such investments that are aware of what their money could achieve: 58% of all investors agree that it’s now even more important for them to invest their money to help achieve net zero emissions.
- 86% of those who’ve invested in Funds would be prepared to pay a higher fee on a fund that was going to achieve environmental and / or societal benefits (given the same returns between funds). This rose to 93% amongst those who had also taken an interest in COP26.
- ESG is already a part of their everyday decisions: 2 in 3 investors think about the impact their everyday food and grocery purchases are having on the environment and society (69%) and future generations (66%), often or all the time
- COP26 has not galvanised investors as much as we’d hope. Our investors believe that the richer countries should be helping the poorer countries to transition (71%) but again we see doubt creeping in with over half (57%) not feeling that COP26 produced the outcomes that will lead to global alignment on tackling climate change. Just 21% feel alignment will be achieved.
- Investors prefer to follow an inclusive transition approach to achieve net zero emissions
- Investors prefer to use an active manager for investments with a focus on achieving net zero or other environmental and societal benefits