Why include an ESG strategy as part of your pension planning?

I’ve written before about ESG – Environmental, Social, and Corporate Governance (“ESG”) - investing. One of the key things to remember about ESG is that it is far broader than existing ethical investment approaches. The focus is on aligning people, politics, and the planet with profit. This makes it about far more than just environmental factors and makes it ideal for people who are looking to invest in options that are akin to where their values lie.

Recent research shows that two-thirds of consumers surveyed believe that it is important to consider ESG factors before investing. This figure rises to almost three out of four respondents who stated they had a pension.

So why consider including an ESG strategy as part of your pension?

Demand for ESG is continuing to gain momentum. There is a huge amount of choice when it comes to products available. This choice is also growing at a strong rate as an increasing number of companies introduce an adherence to ESG criteria. It has been widely recognised that this commitment by companies is being both sought and recognised by people. The Covid-19 pandemic accelerated this thinking to an extent.

All of this means that it is getting even easier for an individual to select an ESG option that suits their risk profile. And in doing so, also do good through their investment choices. By following this strategy for a long-term investment, you are literally investing in your financial future as well as the future of the world around you.

Although relatively new, ESG strategies that are included as part of a multi-asset portfolio are proving to have positive and steady returns. As always diversification is key to success in investing.

Earlier in 2021, new EU Sustainable Finance Disclosure Regulation came into law. This makes it easier for you to understand the ESG approach in terms of compliance and screening. This can be a critical aspect of your decision making when combined with your risk tolerance, goals, and objectives.

These are just some of the factors that I consider when discussing your financial plan. It is about creating a plan that is part of your Plan for Life and takes on board your values and beliefs.

If you’d like to have a chat about your financial future and how we can help you plan it, just get in touch.