Over half of investors plan to increase ESG investments in 2024

Nigel Green, CEO of deVere Group, described the surge in ESG-oriented investments as “not just a statistical blip” but a reflection of a “fundamental shift” in investors’ mindsets.

In a poll of over 800 clients, more than half (56 per cent) of investors said they were preparing to increase their allocations to ESG investments next year.

“People are increasingly drawn to ESG investments for a multitude of reasons, spanning ethical considerations to financial prudence," said Green.

“Companies with robust environmental, social, and governance practices are better equipped to navigate regulatory changes, reputational risks, and operational challenges. Investors are, therefore, drawn to ESG investments as a means of fortifying their portfolios against unforeseen risks.

“This survey reflects a broader shift in investor consciousness - a realisation that investing in a sustainable future is not only ethical, but also a savvy financial strategy.”

Net zero commitments on the rise

Elsewhere, a separate survey by the Pensions and Lifetime Savings Association found that the number of pension funds with a net zero commitment had risen from last year.

More than two-thirds (68 per cent) of pension funds have a commitment to net zero alignment in place according to the PLSA’s survey, up from over half (57 per cent) in May 2022.

Nine out of 10 funds are targeting being net zero compliant by 2050, with one in seven (14 per cent) aiming to be compliant by 2035, and one in five (18 per cent) working towards a target between 2035 and 2040.

And while the survey found that three in 10 funds (27 per cent) did not have a net zero commitment in place, one in 10 anticipated implementing a commitment in the next one to two years, and two in 10 said they would have one in place in at least two years’ time.

The publication of the survey results coincided with the PLSA’s ESG conference during which James Richardson, chief economist at the Climate Change Committee, told delegates that pension funds and asset managers had an “important role” to play in bringing down CO2 levels.

Chloe Cheung is a senior features writer at FT Adviser