Responsible Investment News

Sustainable times: why advisers need to speak ESG

Despite COVID-19, responsible investment continues its forward march across financial services. At the start of this period, many would have been well within their rights to ask how responsible investment might hold up in what has been one of the greatest tests in markets for at least the last decade.

The lesson that most investors are taking from the ongoing COVID-19 pandemic is that responsible investors have navigated recent tumultuous markets much more strongly than those ignoring this trend.

Responsible investing – a term that incorporates approaches such as environmental, social and governance (ESG) integration, ethical and impact investment – now constitutes a major focus of New Zealand investors, with RIAA’s RI Benchmark Report showing the vast majority of the domestic market being managed through responsible investment approaches, a number that’s been steadily increasing each year.

The reasons for this strong growth are well worth financial advisers paying close attention to.

A growing weight of evidence is demonstrating that responsible investment products have maintained frequently stronger risk-adjusted performance when analysed against their peers, consistently outperforming against the benchmark over short- and long-term time frames.

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