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Retail Investors Want Funds and Pension Plans to Take an Active Role in Addressing Climate Change

This is a key finding of a global survey undertaken by GlobeScan and InfluenceMap of retail investors and what they want from their fund managers on climate and sustainability issues.

Other key findings include:

• Retail investors support investment funds being more involved in addressing climate change, as well as in the protection of nature and wildlife and resolving economic inequality.
• Public support is particularly strong for investment funds encouraging governments to act on climate change, followed by financing companies advancing cleaner energy.
• Retail investors also say it is important for their investments to consider protecting nature and wildlife, reducing economic inequality, and addressing climate change.

The survey of nearly 5,000 retail investors (defined as those who own and invest in stocks, bonds, funds, or who participate in company or government pension or retirement schemes) in ten countries and territories (Australia, Canada, France, Germany, Hong Kong, Italy, Japan, Singapore, UK, and the USA) was conducted in July and August of 2023 and shows that retail investors in the ten markets surveyed express similarly high levels of support for investment funds becoming more active in the climate space.

Investors in Germany are particularly prone to strongly support investment funds taking an active role in addressing climate change, while support is somewhat weaker in the Asian markets surveyed (Hong Kong, Japan, and Singapore).

The report also found:

• 44% of retail investors strongly support investment funds advocating for governments to act on climate change, with another 43 % somewhat supporting it.
• More than four in ten retail investors (42%) also strongly support investment funds in financing companies advancing cleaner energy, with another 47% somewhat supporting it.
• Almost four in ten (39%) also strongly support investment funds proactively encouraging companies they are investing in to act on climate change, with another 48% somewhat supporting it.
• In addition, 38% of retail investors also strongly support investment funds in avoiding investing in companies that contribute significantly to climate change, with another 43% somewhat supporting it.
• There is also relatively strong support among retail investors for investment funds to provide information on the impact of investments on nature and wildlife (38% strongly support, 49% somewhat support), on economic inequality (37% strongly support, 50% somewhat support), and on climate change (30% strongly support, 56% somewhat support).

Daan Van Acker, Program Manager at InfluenceMap said:

“GlobeScan’s research shows the extent of retail investors’ demand for ambitious climate action by their fund and pension managers. This stands in stark contrast to InfluenceMap’s findings that the world’s 45 largest asset managers are investing almost three times more assets in fossil fuel companies than green ones, while the proportion of managers with ambitious investee company stewardship has almost halved since 2021.

These asset managers, while holding significant influence over sustainable finance policy, are not engaging to support it, either in the US or the EU. In fact, 86% of the fund management firms we assessed are members of industry associations that are strategically opposing sustainable finance policy globally.

If these fund managers are to meet expectations of their retail investor clients, it’s time for them to match their top-line statements with ambitious action on climate.”

Chris Coulter, CEO of GlobeScan said:

“Not nearly enough attention is being paid to the hopes, values and expectations of retail investors, the owners of so many assets across the world. This research showcases the opportunity for asset managers to be much more responsive to their investor base and shift their investment strategies towards more low carbon, nature positive and inclusive investments."