How sustainable fund managers can attract retail investors.

May 8, 2024

Voyado recently released a survey report on Swedish consumer’s attitudes towards sustainability in retail, which contains some very interesting insights. 61% of the respondents claim that sustainability is important for their consumer decisions, 14% of them even claimed sustainability was very important in their decision making.

This should be great news also for sustainable retail investment funds and companies looking to attract retail investors. Given that Swedish retail investors on the online investment platform Avanza alone has almost 800 Billion SEK of capital, the conditions for sustainable companies and funds to attract retail investors should be great.

But the report also highlight 5 barriers for consumers to choose the sustainable options, with the clear number one barrier being the price premium associated with a sustainable product. But this should not be a problem for sustainable funds, as Söderberg & Partners claim that fees for sustainable funds are actually lower than for regular funds. The other 4 barriers can be summarized as communication barriers associated with the difficulties of communicating what you consider to be sustainable and what the sustainability goals are.

One way to keep costs of operations under control is to use Sanctify ESG to assist with your sustainability efforts. Sanctify ESG is a powerful tool to continuously monitor your stocks to find the most sustainable companies and making sure they live as they learn.

So, all in all, our three advice to attract retail investors to your sustainable funds are.

  • Keep your operation efficient in order to keep the fees low.
  • Set up clear visions and goals for the sustainability strategy.
  • Communicate the vision and the goals in a clear manner.