22 March 2017
Reporter: Stephanie Palmer
ESG key for millennial investors
Millennial investors find environmental, social and governance factors to be important, but their return expectations are unrealistic, according to a speaker at the ALFI European Asset Management Conference.

Citing the 2016 Schroders Global Investors Survey, Courtney Waterman of Schroders noted that, on average, investors aged 35 and under expect returns of 10.2 percent per annum, compared to a global stock market yield of just 3.75 percent, at the time of the survey.

Despite this grand expectation, this demographic was less willing to take on any capital risk.

There is a general trend towards “short-termism”, Waterman said, with investors planning on holding investment for an average of 3.2 years. Of all survey respondents, 18 percent said they will hold their investment for more than five years.

Among millennials, however, 41 percent said they will invest for under a year, while only 8 percent said they will invest for over five years.

When asked what is important to them regarding their investments, the same millennial investors generally rated ESG issues as highly as they rated “some of the more financial factors”.

Waterman suggested that getting returns in line with inflation was considered equally important to “investing in a company that is looking at the impact it has on the environment around it”.

Equally, millennial investors were more inclined to stick with an ESG investment for longer, even if it was not performing as expected. Some 91 percent agreed they would continue with an ESG investment.

The importance placed on ESG issues could bode well for the industry, Waterman said. Aside from the social initiatives that come with this kind of investment, ESG could be the key to keeping the next generation of investors engaged.

More Industry news
The latest news from Asset Servicing Times
Join Our Newsletter

Sign up today and never
miss the latest news or an issue again

Subscribe now
State Street reports double-digit custody and administration growth
27 April 2017 | Boston | Reporter: Stephanie Palmer
State Street has seen a 10.7 percent increase in assets under administration and custody, ending Q1 2017 with just shy of $30 trillion
Hague: Financial services will thrive after Brexit
25 April 2017 | London | Reporter: Stephanie Palmer
Lord William Hague sees a positive future for the UK’s financial services industry post-Brexit, but attendees at SWIFT Business Forum London were not so easily convinced
Sharing is caring is cyber crime combat
25 April 2017 | London | Reporter: Stephanie Palmer
A more holistic and communicative approach is required to tackle cyber crime in financial services, heard attendees of the SWIFT Business Forum
AxiomSL wins commodity transaction and trading reporting mandate
24 April 2017 | London | Reporter: Stephanie Palmer
Commodity trading firm Trafigura PTE has selected the AxiomSL platform for its global trade and transaction reporting
Record-breaking Q1 for BNY Mellon
21 April 2017 | New York | Reporter: Stephanie Palmer
BNY Mellon saw record breaking levels of assets under custody and/or administration in Q1 2017, reaching a total of $30.6 trillion
BlackRock sees uptick in AUM
20 April 2017 | New York | Reporter: Stephanie Palmer
BlackRock’s total assets under management (AUM) have seen a 14 percent increase to reach $5.2 trillion, its Q1 2017 results have revealed
BNP Paribas to improve fund distribution
19 April 2017 | London | Reporter: Becky Butcher
BNP Paribas Securities Services has developed a new digital fund distribution platform in partnership with AXA Investment Managers
More Industry news