Next generation calls for ISAs to match values

Seven in ten UK consumers say banks and financial providers need to be more transparent about how they invest their customers’ money, while half think financial providers actively hide the sectors they invest in.

The research from Triodos Bank UK also reveals that two thirds (64 per cent) say the Government needs to do more to make banks be transparent and ensure greenwashing is avoided with industry-wide standardisation in the definition of ‘sustainable’ or ‘ethical’ funds.

Four in ten 18–34-year-olds say that their interest in ISAs and investing has increased during last 12 months, with the most common reason for this being that the pandemic has made them more aware of the need to have a secure long-term financial future. These younger investors are much more likely to choose investments and providers that align with their values, with 94 per cent of ISA holders age 18-34 saying they already have or would consider switching their money to an ethical provider – compared to 71 per cent of over 35s. This indicates that as the next generation of investors comes to choose their ISA products, there could be a significant boost in ethical and sustainable investments.

Across all ages, interest in ethical investments are on the rise. Investors are looking to use their investing power to support healthcare and a greener future, with two thirds (62 per cent) claiming the industry needs to do more to help people invest their money in a way that supports positive social and environmental change.

When it comes to avoiding industries with negative connotations, there is a clear opportunity to offer investors the chance to align their money with how they choose to act on their personal values in other ways. Over a third of people who wouldn’t want their investments to support fossil fuels (37 per cent), fracking (36 per cent) or gambling (33 per cent) say they would not work in these industries.

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