Record growth in sustainable investments

With an increase of 169 percent compared to the previous year, the volume of sustainable investments in Switzerland amounted to CHF 191.9 billion at the end of 2015. More and more asset managers are integrating environmental and social aspects into asset management. For the first time, self-managed assets of institutional investors were also recorded, which also contributed to the strong growth. At 75 percent, the share of institutional money is higher than ever before.

The significant growth is largely due to the sharp rise in the volume of sustainable mandates, which, at CHF 96.5 billion, is 165 percent above the previous year's figure. The CHF 55.2 billion in assets of institutional investors recorded for the first time also contributed to the strong growth, as did the increase of around 16 percent in sustainable funds. This shows the latest Swiss market study sustainable investmentswhich was jointly prepared by the Forum Nachhaltige Geldanlagen (FNG) and Swiss Sustainable Finance (SSF) and presented by both organizations in Zurich on May 10.

"The exceptionally high growth of sustainable investments reflects the increased attention the topic is gaining among institutional investors in Switzerland," explains SSF Managing Director Sabine Döbeli. "But the consideration of environmental, social and governance (ESG) criteria is also playing an increasingly important role in private asset management," she adds. "It is striking that, as a result of the Paris climate conference, more and more investors are also including climate risks in their investment decisions," explains FNG Vice President and Head of FNG Switzerland Patrick Wirth. "From the measurement of climate risks to clear disinvestment decisions, the spectrum is wide there," he describes the results of the special survey on climate investments.

"Stimulated by various studies from the federal government, the public debate on the responsibility of investors has intensified over the past year," explains SSF President Jean-Daniel Gerber. "However, the growth shown is only the beginning. Initiatives, such as the establishment of SVVK-ASIR by a number of public investors last year, will further accelerate the trend," says the SSF President on the positive dynamics in Switzerland. "Also looking beyond national borders, we are currently seeing a lot of movement in the sustainable investment market, in particular due to the debate on climate change, but also in connection with human rights and other issues," adds FNG Board Chairman Volker Weber. "Institutional investors have been and continue to be key drivers of this."

While exclusion criteria are still the most important approach, the integrated approach has displaced the best-in-class approach from second place with a growth of 300 percent. This means that social, environmental and governance-related criteria are increasingly finding their way into financial analysis, where they are used to better identify performance opportunities. The third most important approach is standards-based screening, in which violations of international standards are specifically filtered out of portfolios. With an increase of 274 percent, the engagement approach, in which an active dialog is conducted with companies on sustainability issues, has also gained in importance.

In addition to sustainable investments in the narrower sense, responsible investments were also included, which are mostly based on the exclusion of controversial areas such as internationally outlawed weapons. Such criteria are applied to investments totaling CHF 2.4 trillion, making this area mainstream.

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