Local research firm Investment Trends has revealed that 78 per cent of Australian investors currently adopt, or are considering adopting, ESG investing principles.
In its inaugural ESG Investor Report released this week, the Sydney-based company revealed that the consideration of ESG factors is gaining “widespread appeal”, with subjects including climate change and environmental issues like renewable energy and reducing carbon emissions receiving a high level of support from investors.
“In the wake of the pandemic, social movements like [Black Lives Matter] and ever-frequent environmental concerns like bushfires and droughts, Australians are closely examining how their actions impact the world around them,” Investment Trends’ head of research, Irene Guiamatsia, said.
“Increasingly, many are realising how they allocate money plays a vital role in supporting positive initiatives or avoiding harmful outcomes.”
Ms Guiamatsia continued: “Australian investors say they already do their part to help the environment in their everyday lives, such as recycle non-biodegradable waste (80 per cent), reduce their energy consumption (74 per cent) and use biodegradable products (61 per cent).
“Positively, many are also prepared to take a step further by making an impact through their investments.”
The report also found that 81 per cent of current ESG investors believe the long-term performance of ESG investments will be as comparable, if not better, than non-ESG investments.
“Ultimately, the proof will be in the returns,” Ms Guiamatsia said.
“As we march towards the 2050 target for net zero emissions, climate risk impact and ESG factors will increasingly become material in any well-considered long-term investment strategy.
“Asset managers, product issuers and service providers all have a role to play in helping Australians better understand how they can align their investments with their own ESG principles.”
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