Sustainable investment in Europe has grown sharply in the past few years among high net worth individuals, easily outstripping investment on the continent in general, according to a survey of asset managers, private banks, wealthy individuals and family offices.
The number of European high net worth individuals, or HNWIs, that have placed more than half of their assets into sustainable investments has more than doubled over the past two years, rising to 25 percent in the 2012 survey from 12 percent in the 2010 survey, according to the European Sustainable Investment Forum, or Eurosif, a membership association aimed at promoting sustainability through financial markets in Europe.
At the same time, the proportion of European HNWIs who see sustainable investment as a proper discipline rose to a majority, or 51 percent, from 37 percent in 2009 and 33 percent in 2007, the study authors says.
The number of respondents who say they view sustainable investments as an asset class dropped to 2 percent currently from 16 percent in 2009 and 27 percent in 2007.
‘Beyond mere financial returns, European high net worth individuals are also supporting more projects that primarily seek a measurable environmental and/or social impact,’ Eurosif president Giussepe van der Helm and executive director Francois Passant write in the study.
‘Sometimes this is viewed as a more entrepreneurial approach to philanthropy; sometimes it is viewed as applying business acumen to addressing societal challenges.’
Overall, the allocation to sustainable investments by European HNWIs rose 58 percent over the past two years to €1.15 tn ($1.47 tn) from €729 bn, far outstripping the 18 percent rise in general wealth for European HNWIs, according to the survey of more than 500 wealth managers, private banks, asset managers and HNWIs. This is the third such survey, following editions released in 2010 and 2008.
Of the three components of ESG investing, 38 percent of the survey’s respondents placed a greater emphasis on environmental concerns, while 35 percent focused more on social aspects, according to Eurosif. Governance issues were emphasized by 27 percent.
Climate change was the single issue of greatest concern, with priority given to it by 15 percent of investors, the survey shows.
Energy efficiency and human rights followed closely, each with 14 percent. Health came in fourth, with 13 percent, followed by education with 12 percent and biodiversity with 11 percent.
