St. James’s Place (SJP) recently concluded its annual Client Conference: A World Worth Living In, a virtual event broadcast across Asia which discussed a range of sustainability-related topics including climate change, financial education and investment management.
This follows a recent report by SJP Asia, which surveyed over a thousand investors in Hong Kong (1,019) and Singapore (1,045) each for their views on Environmental, Social and Governance (ESG) investing.
Robert Gardner, Director of Investments at St. James’s Place, shared his following comments at the conference:
An appetite for sustainable investing
A recent report by SJP Asia has found that 60% of Hong Kongers and 57% of Singaporeans would consider ESG factors in their investments, with 43% and 40% respectively stating that their interest in ESG investing is increasing. However, over half of Singaporeans (53%) and three in five Hong Kongers (60%) also believed that they would need to compromise on investment returns in order to invest responsibly.
The opposite is true, as market data shows a strong correlation between investments with strong ESG ratings and better performance. The investments with stronger ESG credentials are also more likely to have better long-term growth prospects, since they are by nature much more sustainable.
When it comes to which issues are most important to investors in Hong Kong, social issues (40%) are the top concern, followed by environmental responsibility (38%) and governance (22%). For investors in Singapore, environmental responsibility (43%) is the top concern, followed by social issues (32%) and governance (25%).
Using money as a force for good to ensure a sustainable future
One of the most effective ways for individuals to lower their carbon footprint is to move their pension investments towards sustainable funds. According to projections, this can help reduce an individual’s carbon footprint by over 2,200 tonnes of CO2 emissions over their working life, or about 27 times more than reducing showers by two minutes each time taking one less international flight per year; taking the train instead of driving and eating only one piece of meat each week, combined.
The 100-year life and its implications for sustainable financial planning
Today, an increasing number of people are reaching their 100th birthday because of better medical care and living conditions such as sanitation and housing. We are seeing an upward trajectory in the number of people living past 100 years old.
In 2020, there are 573,423 centenarians, which is almost 17 times more than 70 years ago and projections suggest 3.7 million in the world will become centenarians in 2050. This is in contrast to 70 years ago, where people only lived to the age of 45 on average. With people living longer today, there is also a greater emphasis on responsible investing to drive changes for good, than simply to just generate profits.