At a time when environmental, social, and corporate governance (ESG) investment data is becoming more popular, more and more wealth management firms and advisers are asking for assistance in accessing this important information. A survey by the Personal Investment Management and Financial Advice Association (PIMFA) has revealed that over one third of advice businesses and wealth managers are requesting additional support with this area.
The survey highlighted how the sector is looking to enhance its understanding of the ESG market and to benefit from the sound investment strategies and long-term financial gains it can bring. Increasingly, advisers and wealth managers realise that ESG investments make for better risk management, lower costs and more clarity on the specifics of investments.
By embracing ESG data, wealth management firms and advisers can gain a competitive edge, strengthening their client portfolios and ensuring they are delivering an exceptional service with all aspects of investment management.
The PIMFA report revealed that the most popular ESG tools being used by advisers and wealth managers include compliance, data management and performance assessment. These resources help them to make informed decisions on how best to identify the right ESG investments for their clients.
With the asset management industry now facing increased competition, advisers and wealth managers must offer great value and reliable returns on investments for clients. There is mounting evidence that embracing ESG practices is not only beneficial for the environment, but for a firm’s bottom line too.
International standards for ESG investing are continuing to evolve, providing firms with the necessary guidance and frameworks for investing in line with their clients’ expectations. As ESG investments become part of everyday business strategies, wealth managers can take advantage of the growing trend and apply this knowledge to maximise returns for clients.
The data collected from the PIMFA survey reveals how access to ESG investing is now seen as an essential skill. It is crucial for wealth managers and advisers to have knowledge of the industry, an understanding of the top financial trends and the ability to make strategic investments.
In order to ensure they are up to speed, and able to take advantage of the business opportunities presented to them, wealth management firms and advisers need to continue to stay informed of the changing trends and have access to the right ESG data.
The use of ESG data is no longer a luxury; it has become a necessity for businesses looking to remain competitive in the current economic climate. With increased consumer demand for sustainable investments, and the long-term financial rewards associated with embracing ESG practices, now’s the time for wealth management firms to make sure they have a robust investment strategy that is both profitable and sustainable.