Boom time for ethical investment

Net retail sales of ethical and socially responsible investment funds in the UK have more than doubled from £206m in 2013 to £460m in 2014.

According to figures from the Investment Association, the total funds under management reached £9.8bn in June 2015 for ethical funds.

However the UK has some catching up to do, with trillions of dollars pouring into the global sustainable investment market. FUM globally in this area have grown from US$13.3trn (£8.7trn) at the start of 2012 to US$21.4trn (£13.9trn) at the start of 2014, according to The Global Sustainable Investment Association.

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From 18 to 24 October, the UK Sustainable Investment and Finance Association will be holding Good Money Week.

Jupiter ecology fund manager Charlie Thomas said: “So-called ‘green’ finance cannot conceivably remain a niche interest over the medium term.

“The world is now adding more electricity capacity in renewable power each year than coal, natural gas, and oil combined. This, we believe, is a key driver behind the 50-fold increase over the last year in the total assets of investor groups who have committed to either cut back or sell out of holdings in fossil fuel companies.”

Adviser view

John Ditchfield, director of London-based Ifa Barchester Green Investment, said: “We are finding an increasing interest from clients for SRI, and there are a number of ethical or SRI funds that consistently outperform their peers.

“For instance, we like the Kames Ethical Fund and the First State Asian Sustainable Fund. Of course funds that did not include mining stocks or oil companies did well during the recent sell-off, such as Premier Portfolio Managers’ ConBrio Best Income.”