Sustainable Investments
Financial Advice

Sustainable Investments

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MB+M OzPlan’s Wealth Creation Team talks about Sustainable Investments

For many people, there is much more to choosing investments than focusing exclusively on financial returns. Returns are important, but a growing number of people also want to be assured that their investments align with their values.

Everyone’s values are different but given the choice most people would wish to make a positive difference to their community and/or the planet. Or at least to do no harm.

Indeed, research by Canstar found four out of five Australians believe environmental issues are important when it comes to their investment decisions.

As a result, there has been a surge in what is called responsible investing. Also known as ethical or sustainable investing, responsible investing is pretty much what it says on the label. That is, investments that support and benefit the environment and society more broadly, rather than those whose products or way of conducting business have a negative impact on the world.

Graph with green leaves

Millennials driving growth in sustainability.

The trend toward responsible investment has grown rapidly in recent times.

According to the Responsible Investment Association of Australasia (RIAA), Australians invested $1.2 trillion in responsible assets in 2020, and we’re not alone.

The global figure was $47.8 trillion in 2020.

The trend has accelerated in recent years, with money flowing into Australian sustainable investment funds up an estimated 66 per cent in the year to June 2021.

Responsible investing is particularly popular among millennials, now in their late 20s and 30s and beginning to get serious about building wealth. Many in this group are getting a foot on the investment ladder via exchange-traded funds (ETFs). A recent survey of the Australian ETF market found 28 per cent of younger investors had requested more ethical investments.

Piggy bank with green leaves

 

More sustainable investment options

As awareness of responsible investing grows, so does the availability of sustainable investment options, beginning with your super fund.

Most large super funds these days offer a sustainable option on their investment menu. 

 

While relatively rare even 10 years ago, the availability and performance of sustainable options has grown strongly over the past three to five years. According to independent research group, SuperRatings, the top performing sustainable options now surpass their typical balanced style counterparts in some cases.

If you run your own self-managed super fund (SMSF) or wish to invest outside super, there is a growing number of managed funds that actively select sustainable investments, or ETFs that passively track an index or sector.

There were 135 sustainable funds in Australia and New Zealand in 2021, so there is plenty of choice.

Interested in sustainable investing?

If sustainable investing sounds like a good fit for you, give the Wealth Creation team or your Adviser a call on 5831 1233 or email mbmozplan@mbmgroup.com.au to find out more today.

Further Information:

RIAA: https://responsibleinvestment.org/resources/benchmark-report/

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