Assets under management within recommended healthcare funds surged at Standard Chartered Private Bank as part of a broader trend of increasing adoption in sustainable investing.

Recommended healthcare fund AUMs surged 50 percent year-on-year, according to a recent Standard Chartered report, despite market volatility. Driven by the pandemic, this was in line with growing demand for sustainable investing including a focus on United Nations Sustainable Development Goals (SDG) like clean water and sanitation, and good health and well-being. 

«There were also lower drawdowns year-to-date in healthcare funds and during the market pullback in March 2020, highlighting the resilience of the sector,» the bank said. «This strong performance stands out when compared to the broader equity market in particular, which has fallen 15 percent year-to-date (MSCI ACWI, as of 14 Apr 2020) versus the funds’ performance.»

Near-Universal Interest

Globally, as many 90 percent of investors are interested in sustainable investments, according to the bank’s recently conducted survey. Even Asia where sustainability is still in its nascency, the gap is closing with 43 percent of respondents considering allocating 5-15 percent of their funds in sustainable investments compared to 42 percent globally. 8 percent of respondents in the region are considering to invest more than 25 percent of their funds in the space.

Despite the growing relevance, investors remain resistant. Although 98 percent of affluent investors are interested in sustainable investing, 93 percent were apprehensive about the subject. 

«Banks therefore play a critical role in providing essential guidance to clients to unlock the growing momentum for sustainable investing,» the bank added. «Besides the lack of knowledge and apprehension, the other top barriers to investment in this segment are lack of motivation and advice.»

Singapore Demand

The report also highlighted Singapore’s promising future as a center for sustainable investment demand. In addition to 39 percent of Singaporean respondents willing to allocate 5-15 percent of funds in the space, the city-state was home to individuals who were globally the most knowledgeable in sustainable living, responsible investing and social investing means. 

In fact, Standard Chartered kicked off an environmental, social and governance (ESG) awareness campaign in June this year and has since seen a 90 percent spike in AUMs from ESG funds offered on the bank’s platform. 

«There is definitely heightened interest and greater demand among investors in Singapore to make a positive impact on society and the environment, while still achieving their financial goals,» said Sumeet Bhambri, ASEAN and South Asia and head of wealth nanagement, Singapore, Standard Chartered Bank. «What is important is closing the gap between investor interest and awareness of the ESG solutions available to them.»