PRESS RELEASE FROM THE ETHICAL FINANCE HUB
EMBARGO: 00.01, THURSDAY, MAY 14, 2020
NEW REPORT: SCOTLAND CAN LEAD THE WAY IN RESPONSIBLE INVESTING FOLLOWING CORONAVIRUS CRISIS
Scotland can lead the way in responsible investment following the coronavirus crisis, according to a major new report.
The Ethical Finance Hub has analysed the scale of the country’s responsible investing market for the first time, with authors concluding that Scotland is already ‘punching above its weight’.
Industry experts said Scotland is now well placed for the re-evaluation of global economic systems following the COVID-19 pandemic, with renewed calls for finance that works for people and the planet.
Scotland’s £9.5billion UK-domiciled responsible investment represents 11 per cent of the UK responsible investment market, compared to the country’s 7 per cent share of the total market.
The report has found rapid sector growth of around 27 per cent per year since 2004, mainly in climate, impact and Environmental, Social and Governance (ESG) funds.
Thirty-five Scottish responsible investing funds are identified in the report with Scottish listings, representing approximately 18 per cent of the UK total.
And although 99 per cent of responsible investment is concentrated among four major asset managers (Aegon Asset Management, Aberdeen Standard Investments, Stewart Investors and Baillie Gifford), there is also a rich array of smaller firms all committed to responsible investing.
The report has three key recommendations for next steps:
- Local asset managers should work together to position Scotland as a global HQ for ethical finance.
- Public sector pension schemes in Scotland should commit to investing in line with the Government’s ambitions to create a greener, fairer and healthier country by 2032.
- The Scottish Government’s Advisory Group on Economic Recovery should engage with the Ethical Finance Hub to inform and support economic recovery post-COVID-19.
The report, ‘Mapping the Responsible Investing Landscape in Scotland’, has been published by the Edinburgh-based Ethical Finance Hub, with contributors including the University of St Andrews Centre for Responsible Banking & Finance and non-executive director Jon ‘JB’ Beckett, an independent advisory committee member for Royal London and Emeritus for the Association of Professional Fund Investors.
Scotland was chosen for the study as the birthplace of modern asset management, with the country serving as a good benchmark for the wider market.
The findings will be presented and discussed later this year at the 2020 global ethical finance summit, to be held on October 6 and 7 in Edinburgh.
Graham Burnside, Ethical Finance Hub board member, said:
“This report reinforces Scotland’s position as a leading international centre for responsible investing.
“With our asset management community already occupying a pathfinding role in the sector, we stand ready to employ our convening power to mobilise the local financial services sector to support the Scottish Government as it looks to rebuild and reform the economy.
“We expect the coronavirus crisis to increase pressures for a re-evaluation of global economic systems, with a renewed call for finance to better serve people and the planet.
“With a strong track-record in both financial services and climate action, Scottish asset managers are well placed to build on their strong foundations and play a leading role.”
Professor John O.S. Wilson, director with the Centre for Responsible Banking & Finance at the University of St Andrews, said:
“Ethical finance has emerged as an important theme since the global financial crisis.
“This timely publication is a comprehensive, thoughtful and practical resource for practitioners and regulators wishing to understand and evaluate the importance of responsible investing within the modern financial services industry.”
Report co-author Jon ‘JB’ Beckett said:
“Scotland offers a rich heritage in investment innovation; far from being stuck in its own past, and it continues to innovate.
“Yet the true depth and breadth of the responsible investing market has not been accurately reported until now.
“Scotland is punching above its weight and is a centre of excellence in responsible investing.
“This in-depth report provides fascinating results that point to both opportunities and threats for Scotland, UK and beyond.”
NOTES TO EDITORS
The report can be read here https://www.ethicalfinancehub.org/investingscotland2020/
More details on the Ethical Finance Hub are available here: www.ethicalfinancehub.org
More details on the 2020 global ethical finance summit can be found here: https://www.globalethicalfinance.org/ethical-finance-2020/
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