Public backs sustainable finance ‘kitemark’ label
An idea to help customers identify which financial products operate in a sustainable or ethical way has been given a thumbs up by the public in a survey.
Of more than 2,000 respondents, 63% supported the idea of a kitemark-style label to help customers identify which financial products operate in a sustainable or ethical way and 43% said it would make them more likely to buy a financial product.
Awareness of the sustainable investment market was very low, with more than half of the people in the survey not knowing that ethical financial products exist. Perhaps most surprising given their familiarity with online search engines, 63% of millennials were found to be ignorant of such ethical options.
We would like to be able to certify that our funds take sustainability seriously
The survey was conducted as part of Good Money Week, which continues this week until Friday. Good Money Week (previously National Ethical Investment Week) aims to raise awareness of sustainable, responsible and ethical finance, both with the public but also with professionals such as financial advisers and institutional investors such as pension funds.
The UK Sustainable Investment and Finance Association (UKSIF) is the organisation that runs Good Money Week. Chief executive Simon Howard said a kitemark was crucial to combatting ignorance about ethical financial products. He said: "Not enough people in the UK know ethical and sustainable options exist for their pensions and savings and not enough are ready to buy without a mechanism such as a kitemark-style label to sort the wheat from the chaff."
Support for the kitemark also came from Steve Waygood, chief responsible investment officer at Aviva, who compared the idea with another famous ethical label. “Voluntary standards in other industries are relatively commonplace, like Fairtrade in the retail sector, but there is no equivalent for the finance industry," he said. "We would like to be able to certify that our funds take sustainability seriously so that we can assure our clients that our investment approach is both long term and responsible.”
Despite the enthusiasm that greeted the idea of the kitemark, there was no detail from anyone involved about how the creation of such an ethical label might actually happen. "What is needed now is thought as to what best helps investors of various types wishing to invest responsibly and sustainably and how that can be provided," said Howard.
Photo credit: Maroubal2