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Date: 2021-05-05 11:57:17
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From a retail perspective, the assumption is that it’s millennials driving ESG investing. However, the growth has been shown to be much broader across demographics and generations. A recent survey by the Responsible Investment Association (RIA) revealed that more than 72% of Canadians are interested in sustainable investing, which remains consistent with findings a year prior.
The research did reveal, though, that younger investors care slightly more, with 83% of those aged 18 to 34 interested in ESG compared to 59% of respondents aged 55+. Needham believes the reason for this tilt is self-sought education. He added: “I've worked with many millennials and they just seem to put more focus on what they put in their bodies and what they're producing in terms of waste, and they're going to do the research to make sure that those companies are doing right.”
Historically, 75% of ESG investors have been institutions, with the pandemic pulling that number down only slightly, according to Andres Rincon, Director, Head of ETF Sales & Strategy at TD Securities.
While ESG funds have been available in North America for more than a decade, it is only recently that these funds have witnessed a huge pick-up in assets. So, what has been the impetus over the past three years for this uptick in inflows?
Rincon said: “There has been a change in mentality of what's important to everybody. We had the Paris Agreement, which has become very relevant over the past few years, plus these trends take time. Carbon emissions, for example, have become more important and many other different players are telling investors about the importance of being green and environmentally friendly.”