Your pension is likely the most important investments you will ever make it your life, and now this isn’t simply down to the impact it has on your retirement.

With the introduction of the Sustainable Finance Disclosure Regulation (SFDR) in Ireland on 10 March last year, fund managers are now bound by ESG disclosure obligations, which means investors can now choose investments that align with their own ESG values.

What is ESG?

With regard to investments, environment, social and governance (ESG) factors come under the banner of sustainability, and in alignment with financial factors, take into account a range of criteria for investing such as:

• climate change, greenhouse gas emissions, recycling practices, water usage, usage of renewable energy, raw material sourcing (Environmental)
• employee health and safety, fair wages, employee training and development, ethical supply chain sourcing, community relations, privacy and data security (Social) and
• board diversity, executive pay, business ethics, transparency, political contributions, company’s leadership, executive pay, audits, internal controls, and shareholder rights (Governance).

How important is ESG to investors in Ireland

According to a survey from Aviva Life & Pensions Ireland DAC (Aviva), one of Ireland’s leading insurers, two-thirds (67%) of the 1200 consumers surveyed believe it is important to consider ESG factors before investing. This increased to three in four (72%) of those with a pension.

The survey found females (70.4% ) are more likely to consider ESG investing than males (63.9%).

Respondents were asked what action they would take if a company they had invested in had a perceived negative environmental impact. Nearly a third (31%) said they would switch from the company (28% of those with a pension), 26% said they would invest less (30% of pension holders), while 15% said they would stay invested (21% of pension holders).

75% of respondents said they would require strong financial advice as part of making decisions around investments, increasing to 78% for those with a pension.

Is ESG criteria important to you?

Now, saving for your retirement also gives you the opportunity to invest in companies that share your values, from taking action on climate change, to protecting against modern slavery.

There are a range of ESG investment options to explore; talk to our experts about ESG investments, how they work and how they can benefit you and your pension savings.

Call us today on 091 670 123 to learn more and find the right ESG investment strategy to suit you.