Many investors say they are willing to invest ethically but hold concerns over potentially falsified green claims, citing a lack of independent information among their reasons for holding off.
Only five per cent of respondents to a survey conducted as part of a report by the Responsible Investment Association Australasia (RIAA) had negative sentiment towards investing ethically, compared to 2000, when 29 per cent said they were reluctant to invest ethically.
Australian Ethical chief customer officer Maria Loyez says a lack of confidence in identifying truly ethical financial products risks causing inertia among potential investors.Credit: Oscar Colman
Yet 78 per cent of respondents said they have concerns with “greenwashing”, where claims are made about the ethics of an investment that cannot be substantiated, up from 72 per cent in 2022.
The Australian Securities and Investments Commission (ASIC) has been cracking down on superannuation funds and asset managers engaging in alleged greenwashing, which is likely weighing on the minds of those who would like to make environmental, social and governance (ESG) investments.
Almost 80 per cent of the more than 2000 adults surveyed said they would be more inclined to invest in products labelled as responsible or ethical by an independent source.
The RIAA promotes ethical investing in Australian and New Zealand and runs a certification program for responsible financial products, including super funds and managed funds, among other types of financial products.
Maria Loyez, chief customer officer at Australian Ethical, which co-sponsored the RIAA research, says the report reveals a lack of confidence in identifying truly ethical financial products and this risks causing inertia among potential ESG investors.
Australian Ethical was recognised as a “leader” for its adherence to ESG principles in a study released last year by Morningstar of 100 fund managers from around the world.
More want to invest ethically, but one thing’s holding them back
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26.03.2024
Many investors say they are willing to invest ethically but hold concerns over potentially falsified green claims, citing a lack of independent information among their reasons for holding off.
Only five per cent of respondents to a survey conducted as part of a report by the Responsible Investment Association Australasia (RIAA) had negative sentiment towards investing ethically, compared to 2000, when 29 per cent said they were reluctant to invest ethically.
Australian Ethical chief........
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