- 94% of charity investment managers expect ESG will become even more important in portfolio selection
- Charity investment advisers will need to enhance ESG credentials to win business from organisations, Investec Wealth & Investment (UK) study finds
ESG and sustainable investment is set to become even more important for charity investment portfolio management putting pressure on advisers to enhance their credentials, new research with major charities from wealth manager, Investec Wealth & Investment (UK) shows.
The study by the company, part of Rathbones Group, with senior executives at UK charities with a collective £4.074 billion of stock market related investments found 88% say ESG credentials are currently important when selecting investments for their portfolios with 26% saying it is very important.
Over the next three years 94% say ESG will become more important when selecting investments with 16% saying it will become significantly more important. Just 6% questioned say its level of importance will not change.
That will put pressure on investment management advisers working with charities, the research found. Currently around a quarter (26%) questioned say investment managers’ ESG credentials are very important when awarding investment mandates, with 60% saying they are quite important.
The importance will increase according to 97% questioned with 15% saying it will become much more important. Just 3% believe ESG credentials will remain at the same level of importance over the next three years.
Nicola Toyer, Head of Charities at Investec Wealth & Investment (UK) said: “ESG and responsible investment has become more important than ever for charity Trustees as they seek to align their investment portfolios to their values and purpose. In our view, this is now considered equally, if not more important than investment performance.
“At Investec, the integration of ESG risk factors alongside effective stewardship is fundamental to our investment process and helps us to make better investment decisions for our clients. From a charity perspective, ESG goes further than that and often translates into ‘doing good’. Many charities wish to add a values-based overlay to the portfolio with the addition of ethical restrictions.”
It manages more than £3.5 billion for more than 1,100 charity clients and is committed to delivering positive outcomes for charities in ways that go beyond consistent investment returns. That includes a partnership with the National Council for Voluntary Organisations (NCVO), enabling Investec Wealth & Investment (UK) to offer its clients the opportunity for high-quality trustee training as well as working with charity investment consultants to provide the access and information they need.
For over 80 years it has built a reputation for delivering strong, sustainable performance over the long term by delivering bespoke portfolio management which recognises that every charity has unique values and objectives.
As one of the UK’s leading wealth management companies Investec Wealth & Investment (UK) focuses on a relationship-based approach to Financial Planning and Investment Management with the purpose of making a tangible and meaningful difference to clients and their families. For more information on its services for charities go to Investment and banking services for Charities | Investec
