New EU regulation promoting responsible investment is coming to our shores and not before time, says Thomas Stokes, investment director at Aviva Investors
Aviva Investors has a prediction: within five years your clients' pension and investments will be invested "sustainably".
Bold? Perhaps. But there is no doubt there is an element of truth here.
According to investment director Thomas Stokes, the fund managers of tomorrow will be increasingly judged not just by their investment performance, but also on how they approach environmental, social and governance (ESG) issues, such as climate change, inequality, and social diversity. Fortunately, these two aspects are not necessarily mutually exclusive.
In fact, there's empirical research that shows the opposite. For instance, a Morningstar study analysed 4,900 funds and they found that 59 per cent of sustainable funds had beaten their traditional peers over a 10-year period through to 2019.
Aviva Investors Thomas Stokes explains: "In essence, investment returns are not the only thing clients are going to be interested in the years to come. They will also want to ensure their money is being used responsibly to build a better world for themselves and for future generations. The reason we're so positive is because we believe these two goals are aligned. Moreover, these changes highlight a powerful truth: a more responsible financial industry can bring about a lot of positive change to build a fairer and more sustainable world."
Click here for our exclusive spotlight on multi-asset, and how dynamic portfolio management combined with ESG metrics can help clients to overcome longevity risk and achieve their retirement goals in 2021.
