St James's Place  

SJP partner: Advisers need to change how they think about ESG

But both Swarup and Ditchfield said a big problem with selecting ESG or ‘green’ funds was the lack of a benchmark.

Ditchfield, who also runs a research practice which looks at investment funds' sustainability, said the data was “extremely unstructured”.

“The problem is that the data that comes back from the investment fund manager is hugely unstructured so it will be completely different from the last manager and their approach to engagement or climate change and so it's very difficult to analyse. That's a huge challenge.”

Swarup added: “From my standpoint, as an adviser or wealth manager, it's just that there is no standard benchmarking. There are hundreds of funds out there which call themselves to be ESG focused, for example, but there is no standard. 

“I wish that over the next couple of years, we get the standard benchmarking, which is globally accepted, where every fund gets a rank from say zero and 100 gets a score and then it's easier for investors and advisers to be able to put criteria. 

“I think that would be the big breakthrough because right now it's very hard to measure how far one particular fund manager has gone versus the other.”

What do you think about the issues raised by this story? Email us on to let us know