Choosing whether to follow the heart or the head has often proven a challenge for many investors: on the one hand ethically and morally but not financially enriching and on the other financially but not morally rewarding.
The facts show that this is no longer a dilemma.
Research from Moneyfacts Investment Life & Pensions found that overall, ethical or “sustainable and responsible investment” (SRI) funds beat returns generated by traditional funds in 14 out of 20 different investment scenarios surveyed, with the average ethical fund returning 7.8% compared with 6.5% from the average non-ethical fund in the past 12 months.
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A record 1.85 m people are saving and investing £3.6 bn in businesses creating positive social and environmental impact, according to the Ethex annual report of the positive investment market.
A record 1.85 million people across the UK are saving and investing £3.6 billion to create positive social and environmental impact, according to Ethex’s annual survey of the market, launched today to coincide with Good Money Week 2015.
Positive savings and investments – in communities and businesses with a strong social or environmental mission – grew 11% in the last year, more than four times faster than the 2.4% average growth of UK household savings and investments over the last five years, finds the “Positive Investing Report 2015” by Ethex, the not-for-profit platform for positive investments and savings.
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Talk to me about what you want your own money to achieve whilst also seeking an investment return
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Guide to Sustainable Investment – a few canaries in the (literal) coal mine of unsustainable investing.
February 2015: The Global Sustainable Investment Alliance, reports that between 2012 and 2014 the global sustainable investment market grew by 61%, according to a new report. Last year the market saw $21.4 trillion (£13.8tn) in assets invested sustainably, compared to $13.3 trillion (£8.5tn) in 2012.
September 2015: Analysis by Independent SRI Consultant John Fleetwood of 3D Investing indicates that;
– Across UK All Companies: the SRI fund basket has average outperformance of 9.58% over the last 5 years. 11 of 15 SRI UK equity funds outperformed sector average over last 5 years. Average SRI fund outperformed in 3 of last 5 years.
– Across Sterling Corporate Bonds: 5 of 7 SRI funds outperform over 5 years. The average outperformance over 5 years is 3.11%, which is significant for bond funds. SRI funds outperform in 4 out of the 5 year periods.
– And globally, SRI global funds outperformed in 3 of 5 year periods. Over 5 years they outperformed marginally and 7 of 11 funds performed better than global average over 5 years
Fleetwood said: “These are quite remarkable figures. It’s tremendously encouraging to see that long term outperformance is being replicated across different sectors and asset classes. “
October 2015: BlackRock – the world’s largest asset manager and no misty-eyed environmentalist – launches the BlackRock Strategic Funds Impact World Equity Fund, to deliver “measurable social and environmental outcomes while generating competitive financial returns.”
October: EIRIS estimates £15bn invested in green and ethical UK funds in advance of Good Money Week up from £6bn ten years ago.
October 2015: Blue & Green launches its Guide to Sustainable Investment.