New research from Triodos Bank UK reveals a level of greenwashing influencing consumers’ decisions to open ISAs.

Ahead of the April tax year refresh, when many consumers will be choosing new ISAs, Triodos has released new analysis combining consumer polling with independent ratings of financial services providers from Ethical Consumer.

The analysis shows that the majority (55 per cent) of people that have a stocks and shares ISA with a provider classified as ‘worst’ in Ethical Consumer’s ratings incorrectly think that their money is in a ‘green’ ISA.

Moreover, 52 per cent of investors that were influenced to choose their ISA based on sustainability credentials actually have their money in providers classed as ‘worst’ for their environmental impact – suggesting the impact of greenwashing in leading well-intentioned consumers to providers that continue to fund areas that are fuelling climate change and harming the planet.

Greenwashing also persists in savings accounts, as half of cash ISA holders with a ‘worst’ provider think that their money is in a green ISA, and 44 per cent say they were influenced to choose their cash ISA based on these providers’ perceived sustainable credentials.

Roger Hattam, director of retail banking at Triodos Bank UK said: “These findings demonstrate the worrying truth about how well-intentioned consumers are being misled about how their money is being invested. In an industry dominated by opaque sustainability marketing, we have long advocated for much higher transparency – which is why the upcoming FCA anti-greenwashing rules are so desperately needed. There are millions of consumers wanting their money to align with their values, but this is not yet matched with real industry commitment to clearly signpost what causes their money is actually supporting.”

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