Responsible investment reaches $633.2bn

Responsible investment reaches $633.2bn

Almost half of Australia's $1.24 trillion total assets under management is now invested within an environmental, social and governance (ESG) framework, according to a new report by the Responsible Investment Association Australasia (RIAA).


The 2016 Responsible Investment Benchmark Report, released by the Responsible Investment Association Australasia (RIAA), found that 47 per cent ($633.21 billion) of Australian managed funds are invested responsibly.

The RIAA divides responsible investment into 'broad responsible investment' (or ESG integration) and 'core responsible investment' (more aligned with ethical and socially-responsible investment).

Core responsible investment is defined as investment that applies at least one of the following strategies: screening of investment (negative, positive or 'norms-based'); sustainability-themed investing; impact or community investing; and corporate engagement and shareholder action.

Only $51.51 billion is invested in core responsible strategies, according to the report, while $581.63 billion is directed towards broad responsible investment.

However, while it is still relatively small, the amount invested in core responsible investment strategies increased by 60 per cent in the year to 31 December 2015, the report revealed.

RIAA chief executive Simon O'Connor said consumer demand targeted towards superannuation funds, banks and financial advisers is creating "unstoppable momentum" for responsible investment.

"Every year we see more Australians opening their eyes to the opportunities to invest ethically and responsibly," Mr O'Connor said.

"You can invest with confidence, aligning your money with your morals, and it’s not just a ‘well-intentioned’ philanthropic approach, it is generating great returns for savvy investors."

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Responsible investment reaches $633.2bn
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