Despite the pandemic caused by COVID-19 and its devastating impact on the country’s economy and healthcare system, research by the Responsible Investment Association Australasia (RIAA) has revealed that 90% of Australians believe the finance sector plays a key role in generating positive environmental and economic outcomes.
Additionally, 50% was of the view that healthcare and medical products were an important theme when it came to investing their money as well as supporting the environment.
On top of that, 86% of Australians admitted they preferred their saving and superannuation to be invested responsibly and ethically, the report found.
As far as willingness to move money was concerned 74% of Australians said that they would consider shifting their banking and superannuation to an alternative provider that invests responsibly and ethically. Among Millennials the percentage of those who were likely to shift their money was even higher and stood at 82%.
This meant that financial advisers still had a huge role to help their clients align their investments with their beliefs, given that 9 in 10 Australians said it was important to them that their financial adviser provided responsible or ethical options.
At the same time, 86% of respondents believed that financial adviser should ask them about their interests and values in relation to their investments and another 87% felt comfortable discussing their interests and values in relation to their investments with their financial adviser, the research found.
Also, younger generations were leading the way for ethical investing, with in particular generation Z (73%) and millennials (71%) wanting to make a positive difference through their investment decisions as opposed to only 31% of baby boomers.
“People are seeing strong performance of responsible and ethical investment funds and products. Australians’ trust that ethical investments lead to better performance outcomes has skyrocketed with 67% of Australians believing ethical or responsible banks perform better in the long term and 62% for super funds. This is a very significant 33% rise since our 2017 research was conducted,” RIAA’s chief executive Simon O’Connor said.
Following this, the research found that 82% of the nation believed it was the lack of independent information regarding ethical or responsible savings and superannuation which was impacting the Australians decision to change.
"The report shows that Australians’ concern for climate action has reached a tipping point and they’re now focusing on solutions such as responsible investing. We hope these results serve as a call to arms for the entire industry to deliver on Australia’s demands and utilise capital for a sustainable future for everyone” said Allyson Lowbridge, chief customer officer for Australian Ethical, sponsor of this research.
“Globally, more than US$30.7 trillion of assets are being professionally managed under responsible investment strategies, so this is not just a feel-good option but one that can lead to better financial outcomes alongside better outcomes for people and the planet.”