At Tilney we believe that the key themes associated with sustainability are now the mainstream for businesses and consumers. The global pandemic has also added to the existing tailwinds behind sustainable investing, with an increased focus on health and wellbeing, the environment, supply chains and sustainability.
"In recent years many advisory firms have started to outsource investment management and are now using the skills of external specialists to manage their CIP."
As an industry, we have come a long way since Tilney first started managing money in this area over a decade ago, but we appreciate that talking about ESG to your clients is not always straightforward and we're here to help.
Do advisers need to be prepared to talk about ESG?
Yes. From a regulatory perspective, new regulations scheduled to be introduced in 2021 will place a greater emphasis on sustainability considerations when advisers carry out their suitability process and discuss investment objectives with clients. For asset managers operating in the European Union, there will also be additional disclosure regulations and a new taxonomy aimed at standardising classifications. Advisers with knowledge of these upcoming ESG focused changes and the various voluntary initiatives, such as the Principles for Responsible Investment and United Nations Sustainable Development Goals, will be better placed to discuss sustainable investing with their clients.
Is ESG and sustainable investing just a fad for younger generations?
No. A lot of attention is given to the transfer of wealth between generations of families and how advisers manage those relationships, but our experience as a large wealth management company is that all generations of clients are now looking closely at their savings and ESG considerations.
In part, this is because of the strong returns ESG and sustainable funds have delivered for investors over the past five years and this fear of missing out has led a number of clients to revisit their earlier assumptions that they would have to sacrifice returns.
However, the overwhelming driver of client interest in this area is the 'Attenborough Effect' and the growing concerns over the future of our planet. While there are a multitude of ESG considerations and factors that individual clients might be interested in, the media focus on the environment and climate change has made the 'E' the standout factor driving client interest. This is also reflected in the large number of new investment funds that have launched over the past 18 months, the significant challenges of greenwashing, and the changing landscape businesses around the world are adapting to.
How can Tilney help you and your clients
Tilney has a long and successful track record of managing multi-asset sustainable portfolios and the good news is that these are now available to the advisory market.
Our six risk-adjusted strategies that make up the Sustainable Model Portfolio Service are designed to help advisers and their clients navigate the green maze and ultimately achieve their investment objectives. They also provide external advisers with access to investments that might not be available on other platforms and the best ideas of our specialist research analysts and portfolio managers.
How does ESG investing fit within an adviser's centralised investment proposition (CIP)?
In recent years many advisory firms have started to outsource investment management and are now using the skills of external specialists to manage their CIP.
At Tilney we believe offering a range of risk rated, multi-asset sustainable portfolios alongside a traditionally invested CIP not only brings an adviser's proposition up to date, but, perhaps more importantly, offers greater choice and the opportunity for clients to invest their assets in line with their own individual preferences.
This advert is solely for professional advisers and should not be construed as investment advice. The value of investments can go down as well as up and investors may not get back the amount invested. Please note that some ethical funds may, by definition, have a limited investment universe; this may affect performance.
Tilney Investment Management
Authorised and regulated by the Financial Conduct Authority.
Registered in England and Wales, No. 02010520, FRN: 124255.