PIMFA
2022 RESEARCH REPORT SUMMARY
CAN THE FINANCIAL SERVICES INDUSTRY LEVERAGE ESG TO ENCOURAGE PEOPLE TO INVEST?
- Financial Services firms should enhance their marketing and communication strategies across online and social media platforms to attract younger investors and use ESG investments as a parallel catalyst to attract them to investing in more traditional/regulated asset classes in support of long-term financial wellbeing.
- There is a huge opportunity for our sector to increase the number female investors during the ‘Great Wealth Transfer’; however, the current methods and approaches employed are clearly not working for the female market
- Consumers should encourage their friends and families to talk to each other! More specifically, about ESG issues and values as well as investments. Females can share their ESG passion and increase their confidence by talking about investing with the people they know.
- The government (especially the Education Secretary) should review school curriculums (and the delivery of these) to include more education on savings and investments, incorporating support from financial services where possible, as part of their business strategies and marketing campaigns.
WHAT ESG ELEMENTS ARE MOST IMPORTANT TO YOU? AND HOW DO YOU WANT THEM COMMUNICATED?
- Overall, 10% of Female respondents did not consider Governance important, compared to 4% of Male respondents
- 65% of over 65’s were concerned with clean and affordable energy but only 35% of the same age group were primarily concerned with carbon emissions. This may warrant further research into the impact of cost and affordability of ESG access on the interest and impact in this area.
- A study by Forbes found that 73% of those aged 65 and above have a smartphone, so there is clearly a gap in the market here for financial service providers to do more to provide clearer information visually.
- There is a contrast when communicating ESG with younger audiences – an older audience may be used to the older style of written articles and documents and may not trust online communications at all, for fear of scams. There is a gap in the market for providers to use more explanatory and trustworthy visual representation.
HOW CAN THE WEALTH MANAGEMENT INDUSTRY SERVE THE NEXT GENERATION OF INVESTORS?
- Investors aged 18-34 were more inclined to believe that the industry puts their best interests at heart compared to older age groups (most notably people aged 55 and over). There was also no considerable difference in agreement or disagreement with the statement based on income.
- More men (40%) have used or are using an investment app than women (31%).
- Research has shown that, for all age groups, over a third (34%) have taken and acted upon advice from family and friends. This was closely followed by a financial professional (28%) or an employer (28%). This is followed by the internet (24%) and social media (18%).
- The majority of investment apps have chosen to target the younger markets and have reached this audience in a myriad of ways, the use of social technology such as YouTube promotion, TikTok, Twitter, and Facebook is particularly prevalent.
