Two-thirds of people (66%) on average across the Asia-Pacific region say the Covid-19 pandemic has made them realize the importance of sustainable living, and three in five say it has made them want to invest or save their money more sustainably, according to a recent survey.
The survey by Fidelity International aimed to analyse the sentiment of ordinary savers and investors across mainland China, Hong Kong, Japan, Singapore and Taiwan towards environmental, social and governance (ESG) issues and sustainable investing.
Most respondents reported positive sentiment towards the idea — with 57% on average saying they want their money to make a positive change in the world and 63% on average agreeing that it is important to act responsibly and sustainably as investors.
However, many say they face hurdles and don’t have the tools or information to start saving or investing sustainably (46% on average). This was especially true for respondents from older generations compared to younger generations.
“It’s clear that there is a gap between people’s desire to use their money for good and having enough knowledge and confidence to realize that desire through sustainable saving or investing,” says Jenn-Hui Tan, global head of stewardship and sustainable investing at Fidelity International.
ESG awareness differed somewhat across markets, with respondents in mainland China most likely out of the five markets to say that they have heard of ESG investing (65%) and that they are aware they can invest in companies that promote ESG values (72%).
Despite the scattered awareness of ESG and sustainable investing overall, survey participants across the region are aligned in what they understand ESG investing to mean. On average, most say it is about “sustainable use of natural resources” (32%), “reducing waste or pollution” (28%) and “stopping climate change” (24%).
“The survey results provide us with valuable insights into the types of ESG issues that people in Asia care about the most, issues such as the sustainable use of natural resources, waste and pollution, as well as climate change,” Tan adds. “These subjects are likely to become strong investment themes across Asia in the coming years. We expect to see more ESG solutions being developed that address these needs; and in the long run, this in turn will help influence corporate behaviour.”
Indeed, more than half of survey respondents on average agree that investing sustainably is the best option for investors to make a positive change in companies (53%) and that corporate behaviour can be changed by moving investor money (53%).
Despite the overall positive sentiment towards sustainable investing, the survey results highlight that certain misconceptions and barriers to ESG investing still prevail. In general, the public is concerned about whether sustainable investing correlates with good returns. One third (33%) of respondents on average in Asia-Pacific believe that it is impossible to invest sustainably and get a good return.
Many across Asia are still unsure about companies’ ESG intentions. On average, 42% agree that there is no-one ensuring sustainable companies match their promises.
Respondents were also not sure where they could get the right information about ESG investing. On average, 46% say they didn’t have the tools or information to start investing sustainably, and 52% say they have no idea where to get the information.
“It will take some time for the public across Asia to gain a better understanding of ESG,” notes Flora Wang, director, sustainable investing, and portfolio manager at Fidelity International. “Importantly, people’s intentions and willingness to explore sustainable investing is quite pronounced. If we see intention line-up with action, that’s going to have a significant impact on the development of sustainable investing and corporate behaviour over the long term.”