“Wealthy investors are motivated by sustainable values, yet many don’t apply them to investment decisions.”1
It has become more common for affluent investors to incorporate sustainability into their lifestyles. These new behaviors include recycling and using natural household cleaners, making large scale environmentally friendly purchases such as solar panels and electric cars, and even choosing impactful careers. These investors may be more likely to purchase a product from a company with a reputation as a leader in environmental sustainability, versus a slightly-cheaper version of the product from a manufacturer with no known sustainability focus.
Image Source: UBS Investor Watch
However, according to recent surveys by UBS, there is a disparity between these investors’ sustainable values and their investment decisions.2 As a result of these surveys, UBS determined that while 65% of participants believe it is highly important to help create a better planet, only 39% say they have sustainable investments in their portfolio. Reasons for this inconsistency include confusion around sustainable investing options, unknown environmental impacts, and myths of financial returns being sacrificed.
Image Source: UBS Investor Watch
Although there is a clear disconnect, the studies also showed extremely positive feedback from investors already allocating to sustainable investments. The majority of these investors disagree with the financial myths and are satisfied with their investments as “82% believe the returns of sustainable investments will match or surpass those of traditional investments.”3 According to the study, “investors view sustainable companies as responsible, well-managed and forward-thinking—thus, good investments.”4
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1,2.3, 4 UBS Investor Watch: Global insights: What’s on investors’ minds / 2018 Volume 2