Canadians’ knowledge and experience with environmental, social and governance (ESG) investing is mixed at best, finds a new survey from BMO Global Asset Management (BMO GAM).
The survey, which was conducted online in November by Pollara Strategic Insights and included 1,500 adult Canadians, found that those aged 18 to 34 were most knowledgeable about ESG (at 38%, compared with 34% of all survey respondents). That group was also more likely to hold ESG investments than their older counterparts (39%, compared with 31% of investors over age 55).
Yet, those figures aren’t inspiring, especially if you consider that, of the 65% of respondents who said they’d heard about ESG, about one-third (33%) were “unsure of whether they hold these investments in their portfolios.”
Looking across the country, the survey found that people in Ontario said they were most knowledgeable about ESG (40%). Those in the Atlantic and Prairies provinces were least familiar at 25%.
But there is interest in adding ESG exposure, with 32% of respondents saying such products could be in their portfolios in the future.
Based on these results, BMO GAM CEO Kristi Mitchem suggested in a release that there’s an “immense opportunity” for advisors to educate clients.
“The past year has shown the importance of each of the letters in the ESG acronym, including an increased emphasis on reducing environmental impacts, the need for meaningful moves towards equality, and the importance of effective governance practices,” she said.
Recent surveys of global asset managers and Canadian CEOs have also found that there’s work to be done by the financial industry to push for ESG growth.
An EY survey of global asset managers, including some in Canada, found firms are being reactive to investment trends instead of proactive. For example, the majority of respondents (75%) were two to five years away from full ESG integration, and were struggling with lack of standardized data.
Meanwhile, PwC’s latest Global CEO Survey, conducted in January and February, found that less than one-quarter (23%) of Canadian CEOs said they were extremely concerned about climate change and environmental damage — well short of the 30% of global CEOs who expressed extreme concern about the environment.