Addressing the knowledge-action gap about sustainable finance offerings
Whilst a significant proportion of savers claim to want a sustainable investment portfolio, a much smaller number actually save into sustainable finance vehicles. Banks already offer sustainable finance products with similar (or better) performance to products without this label. Why then is uptake so poor?
We are gradually witnessing the transformation from awareness to action within sustainability – from the rise in availability in plant-based products in supermarkets to the growing movement of people flying less. Understanding and addressing this challenge is compounded by the range of factors that influence consumer behaviour, from demographics to economics, as well as cultural and social aspects.
Although many new products and markets are regularly being created within sustainable finance, the availability of these offerings has not translated into tangible action.
Nevertheless, it is up to banks, as providers of sustainable finance products, to understand and tackle the most critical factors that are holding their customers back. This could include hard approaches, such as better product offerings, but also softer approaches, such as changing social norms, and encouraging new attitudes and behavioural patterns.
The challenge: How might we incentivise greater take-up of sustainable finance products in order to increase the sustainability impact of customers’ assets?