Low Ethical investment awareness, despite recent growth

The findings reveal that while 90 per cent of the British public claim to recycle and more than a quarter (26 per cent) say that they cycle or walk to work, only five per cent of them put their money where their mouths are when it comes to ethical investments, and 63 per cent don’t know what an ethical investment is.

The research, conducted for Emerald Knight by Atomik, also highlights the widely held perception that investing ethically means having to sacrifice financial performance.

While 16 per cent of British people would only ever invest for personal profits, only 30 per cent think that you can have both profits and principles when it comes to a socially responsible approach to investment.  

Robert Hague, Emerald Knight’s Sales Director, says:

“The research has revealed low levels of awareness, but there’s no doubt that the market is becoming more mainstream. Over the last eighteen months, there has been significant growth, despite the tough climate, in so-called ‘ordinary’ investors who are increasingly finding that ethical investments fit their requirements from both an investment and a socially responsible point of view.

“People who may previously have invested in property or dabbled in the stock market are looking for something different, but while they are more conscious of the environmental and social impact their choices could make, they are by no means prepared to sacrifice good investment sense to buy into such products.”

Emerald Knight says that a combination of a natural shift in attitudes and sound investment sense has started pushing ethical investment into the spotlight. It typically involves investment in the few industries which have managed to remain in positive growth through the global recession.

And since people have lost trust and confidence in the more traditional investment models, the returns demonstrated by ethical products combined with their social, environmental and ethical benefits make for a very compelling investment case.

It’s also clear that many investors are interested in the concept of investing ethically.

According to a recent consumer survey by Mori on behalf of Eiris, the non-profit sustainable investment research firm, 38 per cent of people with a financial product or service were interested in green or ethical financial products and services.

Of those, 90 per cent said they would be likely to switch to a different provider if it offered green or ethical investment products.

In addition, Eiris says that the amount of money invested in Britain’s green and ethical retail funds has recently reached a record height of £11.3bn. Moreover, in the last decade, the number of ethical investors has tripled, from 250,000 to three-quarters of a million.