Next gen to have a better conscience than their predecessors
Appetite for sustainable investing in the US is moderate at best, but analysts from GlobalData say that, like robo-advice, the offering is ahead of its time and will be key for the next generation.
According to GlobalData’s 2018 Global Wealth Managers Survey, although 90 per cent of US providers interviewed had socially responsible investments in their high net-worth proposition, the demand for those products was moderate at best, sitting at 50.1 per cent (where zero per cent was very weak and 100 per cent was very strong).
A UBS report looked at high net-worth investors with at least one per cent of liquid assets allocated to investments with environment, social and governance factors, and only 12 per cent of high net worth individuals in the US had some sustainable investments in their portfolios.
Sergel Woldemichael, a wealth management analyst at GlobalData, said despite the weak appetite, providers shouldn’t omit sustainable investments in their proposition, as they’ll be key for the next generation.
“As the generational wealth transfer approaches, wealth managers will need to ensure the next generation’s needs are met sooner rather than later, as heirs are likely to start influencing their parents’ investment decision even before the actual wealth transfer,” he said.
“Wealth managers need to adopt or expand their sustainable investments, as demand for these products will only grow.”
Recommended for you
The FSCP has announced its latest verdict, suspending an adviser’s registration for failing to comply with his obligations when providing advice to three clients.
Having sold Madison to Infocus earlier this year, Clime has now set up a new financial advice licensee with eight advisers.
With licensees such as Insignia looking to AI for advice efficiencies, they are being urged to write clear AI policies as soon as possible to prevent a “Wild West” of providers being used by their practices.
Iress has revealed the number of clients per adviser that top advice firms serve, as well as how many client meetings they conduct each week.