On the go: Information overload and high costs are barriers to integrating sustainability in investments, a Pensions and Lifetime Savings Association poll has found.
Attendees at the PLSA’s ESG Conference 2021 were asked to name the biggest challenges when integrating sustainability. Of those that responded, 35 per cent said “too much information that is not distilled”, while 29 per cent listed “costs/resources involved in doing this properly”.
A further 18 per cent worried about “how to reflect members’ values in an investment approach”, while 12 per cent cited a “lack of forward-looking ideas that go beyond past [environmental, social and governance] and carbon scoring”.
Only 6 per cent had trouble deciding whether to engage or divest.
Despite these difficulties, speakers at the conference highlighted the “range of pressures” being exercised on the industry to increase sustainability integration.
“ESG has featured on trustee agendas for a number of years. It’s not new. But what we’re seeing is increased pressure to embed ESG and climate and sustainability into investment portfolios, and that pressure is coming from a range of stakeholders,” said Roger Cooper, head of trusteeship at Pi Partnership Group.
“Clearly, the government has set some very optimistic and stretching targets. The Pensions Regulator is looking to drive trustees to do the right things, sponsors too. And, I think importantly, members must come into focus much more — particularly the younger cohort members,” he continued.
“We’ve got this other spotlight which is from wider society. ESG is a broad spectrum, and trustees need to find the right level of support from advisers and the investment community so that they’re satisfying their obligations, and ESG can go beyond simply compliance.”
