Responsible Portfolios Perform as Well or Better

90% of wealth managers say responsible investment portfolios have performed the same or better than other investments, reports a survey by social investment research firm Eiris.  

The report identifies a growing awareness of environmental, social and governance issues among high net worth individuals and finds that wealth managers are taking a more salutory view of responsible investing in the wake of the financial crisis. 

Over half the wealth managers surveyed said the current financial situation has led them to take governance issues and a potentially tighter regulatory framework into account in client portfolios.

The report Responsible Investment and Wealth Management: Opportunities for the Future, concludes demand for responsible investments continues to rise. 

588 signatories have now signed on to the UN Principles for Responsible Investment initiative, representing $18 trillion in funds under management. Concerns around climate change and child labor have become an integral part of the social landscape and are being addressed in constructing investment portfolios.

With many high net worth (HNW) individuals looking to mitigate risk and focus on long-term goals rather than short-term gains, the report identifies a growing number of investors seeking to understand responsible investment and the value of screened portfolios. As a result of the credit crisis, there is greater focus on the importance of board structure, accountability, governance and remuneration.

"Our study illustrates how the financial crisis has caused real polarisation among wealth managers. Client retention is increasingly a challenge and wealth managers can improve retention rates and gain a competitive advantage by responding to the increasing numbers of HNW individuals who are expressing an interest in responsible investment" explained Victoria Woodbridge, Senior Client Relationship Manager at EIRIS.

EIRIS is a global provider of independent research on the social, environmental and governance performance of some 3000 companies around the world. EIRIS is based in the UK and has offices in the US and France.

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