Ethical Investing is Here to Stay
We live in a time where social consciousness and an awareness of our impact on the world is greater in the collective subconscious than ever before. Thanks to the proliferation of information through social media and our increasingly connected world, people have more opportunities to learn about issues that affect us on a national and global scale. This has translated into changes in behaviour and a shift in expectations from the brands we consume in our everyday lives.
Financial advisers have not been immune from this shift in attitudes. As a matter of fact, those who have been able to jump on the trend for ethical investing have found their position strengthened as they have successfully tapped into the new demands of those on their rosters. Today we will discuss what financial advisers can do to adapt to the new world of ethical investing.
Understanding Your Clients
The first step you can take to creating an ethical investment strategy comes from knowing where your clients are coming from. Recent years have seen an increase in demand from people wanting to know that their money is going towards good causes. Have a look at these funds, and you will see what people look for in where their money goes, and you can fulfil their needs by presenting options that are suited to their expectations.
Explore the Market
There are investment funds on the market that cater to every type of social cause or ethical slant, from those that put money into environmentally friendly enterprises to investment funds that support equality-based businesses and those that favour the ethical treatment of animals. With so many options across the market, it’s important that you keep in close contact with your clients so you know you can target those funds that hold values nearest to their hearts.
Ear to the Ground
Whilst it’s important to understand and respect your clients’ needs, never forget that you have been hired to advise them. This means that you need to build your wealth of knowledge on the ethical fund space to ensure you can guide your clients into making smart and relevant investment decisions. Online resources offer the latest insights into specific topics like the carbon intensity of individual portfolios. Knowing where to find these insights will help you educate your clients and ensure you’re all on the same page when it comes to agreeing on an ongoing strategy.
As we stated at the top of the article today, the proliferation of information has created investors and savers who are more concerned with the long-term impact of where their money goes. As a financial adviser, it is your duty to be prepared for this perspective and provide useful insights that can guide your clients into making decisions that suit their own principles.
A combination of being open to your clients’ needs and building your own knowledge of this emerging market will help you build stronger relationships in the long term. It is the new normal of the investment marketplace.