More than half (54%) of Singapore investors believe in sustainable investing, and 27% are currently invested in sustainable investment products, according to a study by Fidelity International.
According to Fidelity International’s Asia Pacific (APAC) investor study — which surveyed a total of 6,515 investors across Hong Kong, China, Taiwan, Singapore, Japan and Australia — 58% of investors in APAC believe in sustainable investing, and 31% are currently invested in sustainable investment products.
With regards to age groups, millennial investors (aged 30 to 44) showed the greatest interest in sustainable investing, with 70% recognising the importance of acting sustainably and 39% are currently invested in sustainable investing.
Trailing behind, 68% of Gen Z investors (below 30) recognise the importance of acting sustainably and 34% are currently invested in sustainable investing, the study states.
Additionally, the study found that 61% of investors surveyed want their money to make a positive change in the world, with Taiwan (70%), Australia (70%) and Singapore (64%) investors ranking the highest.
More than half of the respondents (60%) also believe that investors can change corporate behaviours by re-allocating their money, especially so in Australia (74%), Singapore (67%) and Taiwan (67%).
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The study found that investors in the region are increasingly open to sustainable thematic investing strategies, with 61% stating that they have incorporated such investments in their portfolios. This represents a significant increase from only 49% of investors engaging in such investments in 2023.
This is especially prevalent in China and Singapore, which had 72% and 64% of investors incorporating sustainable thematic investments in their portfolios, respectively.
This is in spite of 53% of Singapore investors agreeing that there are trade-offs in sustainable investing, either from potential lower financial returns or limitation of options of products.
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Further to the report, the study found that APAC investors do not prefer exclusionary screening when considering sustainable strategies, with only 36% of respondents in the region incorporating this approach in their portfolio.
APAC investors highlighted climate change (50%), sustainable energy (49%) and nature (35%) as their biggest concerns.
According to the study, major reasons for not being interested in sustainable investments include a lack of understanding of sustainable investing (28%), scepticism of its impact (26%) and concerns of lower returns (26%).
Furthermore, 77% of investors worry that their funds may not support ventures that are truly sustainable.
Looking ahead, the study finds that most of the investors surveyed — 64% of them — believe that sustainable investing is here for the long-term while 18% believe it is a short-term trend.
“It is encouraging to see that interest and awareness in sustainable investing is growing and becoming a mainstream investment theme across the APAC region, with investors increasingly believing that they can enact positive change and/or mitigate financial risks through their asset allocation,” says Tan Jenn-Hui, chief sustainability officer at Fidelity International.
“While currently more investors believe in the value of sustainable investing than hold specific ESG-related products, this — and the fact that 41% of investors anticipate increasing investment in sustainable products over the next 12 months — indicates that the market in APAC for sustainable products is likely to grow,” Tan adds. “We also expect more investors to integrate ESG considerations across portfolios more generally, given that 64% of investors in the region believe sustainable investing represents long-term structural change.”
