The JPES Partners Investment Communications Trends Report 2022, which surveys communications professionals at asset management companies, found that 62% of asset managers are still planning to launch new, standalone ‘ESG’ products in the next 12 months, down from 89% a year earlier. This decline can largely be attributed to the fact that 25% of firms said any new solutions in this area would be through the conversion of existing, rather than new, funds.

This strategy of upgrading funds over time was one of the key findings of last year’s report when managers cited concerns of being accused of greenwashing as a reason for taking a cautious approach to their initial classifications under the EU’s Sustainable Finance Disclosures Regulation (SFDR), with the aim of reclassifying them over time.

However, this is yet to satisfy regulators as the UK’s Financial Conduct Authority (FCA) and the US Securities and Exchange Commission (SEC) are seeking tighter measures to limit the possibility of greenwashing in investment products. The FCA’s proposed approach is to go further than existing SFDR classifications by ensuring products classify how they are sustainable and restricting the use of terms such as ESG or green if products don’t qualify.

Greenwashing fears and a prudent approach to product development is also being reflected in how asset managers view their expertise on responsible investing, with fewer firms than ever before willing to declare themselves a ‘pioneer’ in the space.

As the table below shows, in 2019 half of the asset management industry believed it was pioneering in its approach to ESG, now only 6% of asset managers we spoke to would describe themselves as a true ‘pioneer’.

This new, more balanced perception, also reflects a shift in attitude around the way that firms communicate their responsible investment approach. While there isn’t the same frantic need to talk about responsible investment that firms felt a few years ago, half of the managers we spoke to said it does still remain their number one communications priority.

That strategic imperative illustrates why the volume of ESG-related content being produced by asset managers has been rising steadily in recent years, and also explains why 80% of asset managers this year told us that they still plan to increase the volume of ESG content even further, despite the fact that so often, much of it simply cannot be used.

This year the Investment Communications Trends Report has been divided into three shorter, standalone reports. The third of these, on Content & Digital, will be made available in the coming weeks.

To read the report on ESG and responsible investment please complete the form below.

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