Sustainable investments grow at an above-average rate

The report, which as last year was prepared jointly by Forum Nachhaltige Geldanlagen (FNG) and Swiss Sustainable Finance (SSF), looks in detail at the development of the sustainable investment market. The 39% increase is due to organic growth as well as expanded participation in the survey. Many of the 10 new asset owners included began their sustainable investment activities during 2016. For this reason, among others, assets under management by institutional investors increased by 89% to CHF 104.5 billion last year. Sustainable investment funds also increased significantly by 59% to CHF 64.2 billion, which means that their share of the total fund market rose markedly from 4% to 7%. In contrast, the volumes of sustainable mandates virtually stagnated with 2% growth to CHF 97.6 billion.
Exclusion most common approach
The increasing mainstreaming of sustainable investments has an impact on the approaches chosen, which are also used in combination by many investors. The exclusion of certain industries or business practices is still the most frequently chosen approach, being applied to 67% of all sustainable investments in Switzerland. Standards-based screening has displaced the ESG integration approach from second place and is now already applied to 62% of all sustainable assets. "Many of the newly screened assets operate much more on a "worst-out" rather than a "best-in" basis," explains SSF Managing Director Sabine Döbeli. "However, since such approaches are usually combined with active dialog, they can still be used to exert an influence on companies' sustainability strategies that should not be underestimated," she adds.

Focus Human Rights
Human rights are the main topic of this year's market report, reflecting their growing importance in the business world. "The Global Compact and the ILO core labor standards are cited as the most important standards with regard to human rights," says FNG Vice President Patrick Wirth, describing the results of a special survey of study participants on this topic. While with 86% a majority of all surveyed asset managers apply human rights criteria to their sustainable products, almost one third also consider such criteria for their mainstream funds. As a thematic case study, the current market report also presents the activities of the Swiss Association for Responsible Investment (SVVK-ASIR), which were launched in the course of 2016.

"Sustainable investments are also playing an increasingly important role in the implementation of the Sustainable Development Goals (SDGs), as they make it possible not only to promote specific sustainable projects or companies, but also to encourage greater consideration of sustainable standards in the economy as a whole," explains SSF Managing Director Sabine Döbeli. Against this backdrop, continued high growth rates can be expected in the future, an expectation that is also shared by the study participants.

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