Sustainable investment demand set to keep growing and broadening out
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Extreme weather contributing to demand
58% of professional investors say the rising frequency of extreme weather events is fuelling client appetite for sustainable investments.
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Evidence of returns and impact is key
The number one factor that would drive increased allocations is evidence of strong performance.
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End investors’ ESG interests are wide-ranging
Professional investors see climate change mitigation and adaptation as by far the most important ESG issue for clients, but end investors identify varied concerns.
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Policy is expected to drive climate tech opportunity
Two-thirds of professional investors expect government climate policies to drive significant growth in climate solution opportunities.
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Fixed income and multi-asset allocations expected to grow
43% of professional investors expect to increase allocations to fixed income ESG strategies and 51% to multi-asset in the coming year.
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Momentum continues for active ESG ETFs
45% of professional investors expect to increase allocations to active ESG ETFs over the next 12 months, vs. 34% for passive.
Extreme weather contributing to demand
58% of professional investors say the rising frequency of extreme weather events is fuelling client appetite for sustainable investments.
This view is shared by a smaller proportion of end investors (33%), perhaps reflecting the fact that appetite is already high, with 97% stating an interest in sustainable investing.
Data may not sum to 100% due to rounding
Q6. In general, how have the following events affected your clients’ appetite for sustainable investment strategies?
Q4. In general, how have the following events affected your appetite for sustainable investment strategies?
Source: J.P. Morgan Asset Management 2023 Future Focus Survey. Research conducted June and July 2023.
Evidence of returns and impact is key
The number one factor that would drive increased allocations is evidence of strong performance.
Both professional investors and their clients are looking for data on returns. Evidence that sustainable investments can make a positive difference is also important to the two groups.
% Two answers allowed
Q1. What are the most important reasons that lead you to incorporate sustainable investments within client portfolios?
Q1. What are/what would be your biggest motivations to invest in a sustainable investment fund?
Source: J.P. Morgan Asset Management 2023 Future Focus Survey. Research conducted June and July 2023.
End investors’ ESG interests are wide-ranging
Professional investors see climate change mitigation and adaptation as by far the most important ESG issue for clients, but end investors identify varied concerns.
The broader spread of themes identified by end investors is partly driven by the greater emphasis on issues such as health and wellbeing and data privacy among younger investors.
% Rank 1 + 2 + 3
Q3. In general, what ESG issues/themes are your clients most concerned about?
Q3. In general, what ESG/sustainability issues are you most concerned about?
Source: J.P. Morgan Asset Management 2023 Future Focus Survey. Research conducted June and July 2023.
Policy is expected to drive climate tech opportunity
Two-thirds of professional investors expect government climate policies to drive significant growth in climate solution opportunities.
This view is held by at least 50% of professionals in each of the European countries surveyed. Interviews with respondents suggest both professional and end investors see this as a transformational long-term driver but are as yet unsure how to capture the opportunity.
% Agree (Strongly agree + Somewhat agree)
Q19. To what extent do you agree or disagree with the following statements?
Source: J.P. Morgan Asset Management 2023 Future Focus Survey. Research conducted June and July 2023.
Fixed income and multi-asset allocations expected to grow
43% of professionals expect to increase allocations to fixed income ESG strategies and 51% to multi-asset in the coming year.
In both cases, the increase is marked. In 2022, just 21% saw compelling ESG opportunities in fixed income and 29% in multi-asset strategies over the next 12 months. The improved environment for fixed income is likely to be one driver, along with the increasing availability and understanding of a broader range of sustainable investing products.
% Multiple answers allowed
Q11. In which asset classes are you expecting to increase allocations to ESG investment within your clients’ portfolios over the next 12 months?
Q14 2022. Which asset classes do you think will give the greatest exposure to ESG investment opportunities over the next 12 months?
Source: J.P. Morgan Asset Management 2023 Future Focus Survey. Research conducted June and July 2023.
Momentum continues for active ESG ETFs
45% of professional investors expect to increase allocations to active ESG ETFs over the next 12 months, vs. 34% for passive.
Strong appetite for active continues from 2022, when 43% expected to increase allocations in the coming year. Demand for passive has faded slightly, down from 44% in 2022.
Data may not sum to 100% due to rounding
Q9. How is your allocation to ESG investments via the following investment vehicles likely to change over the next 12 months?
Source: J.P. Morgan Asset Management 2023 Future Focus Survey. Research conducted June and July 2023.
Download the chart pack
Take a deeper dive into ESG and sustainable investment trends in Europe and support conversations with your clients with the complete chart pack.
![jpm54317-future-focus-survey-image](https://cdn.jpmorganfunds.com/content/dam/jpm-am-aem/global/en/images/jpm54317-future-focus-survey-image.png)
Methodology
The J.P. Morgan Asset Management Future Focus Survey captures the views of 830 professional investors and 2,000 end investors across Europe in June and July 2023. A regional and demographic breakdown of the respondents is available in the complete chart pack.
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