Finland-based OP Financial Group has reported significant growth in demand for sustainability-themed funds, as investors increasingly emphasize responsibility in their portfolios. OP currently offers four sustainability-themed funds – OP-Sustainable World, OP-Climate, OP-Clean Water and OP-Low-carbon World – and has seen a more than 150% increase in unitholders for these funds over the past 3 years.
Commenting on the growing demand for OP’s ESG investment products, and the appeal of sustainability themes to investors, Tuomas Virtala, Head of Asset Management for Corporate and Institutional Customers, OP Corporate Bank plc, said:
“For many customers, sustainability themed funds are the easiest way to start responsible investing. Curbing climate change, producing low-emission energy and ensuring the sufficiency of clean water also constitute profitable business for many companies.”
Additionally, the company has noted that the COVID-19 crisis appears to have sharpened investor focus on ESG. OP reported today that the number of new unitholders in its sustainability-themed funds has nearly tripled in the spring, over the same period last year, and that during the market turmoil caused by the crisis, net outflows from these funds were lower than those for other funds. According to Virtala:
“It seems that investments in sustainability themed funds are made for the long haul, and people have confidence in their positive performance. Despite the challenging market environment due to the coronavirus pandemic, the returns of, say, OP-Climate OP-Clean Water were positive over the past 12 months.”
At the end of last year, OP conducted a survey on Finns’ interest in responsible investing. Results showed that three out of four Finnish private investors were interested in responsible investing, while one-third of the respondents believed that responsible investing is profitable as well. 63 per cent of respondents were unwilling to invest in issuers whose operations are not ethically sound, and 60 per cent said they want to invest in companies that are active in areas such as combating climate change.