The investment training association CFA Institute has called on investment firms to embed ethical practices into the heart of their business, after a study found just half of investors trust them to “do what is right” in terms of ethics and responsibility.
The figures, released on Wednesday and collated from responses to a survey among investors in the US, UK, Hong Kong, Canada and Australia, show the extent to which people in the industry attach importance to values.
The study found that the UK had the least trusting population of investors, with only 39% trusting the firms that managed their funds. The US was close behind at 44%.
John Rogers, CEO of CFA Institute said, “This represents a significant opportunity for investment professionals and firms to actively build a culture where ethical practices are valued as highly as investment performance.”
The study, which was a joint effort by the CFA and Edelman Trust, says that the key to restoring and maintaining trust within the industry lies with individual investment professionals.
Ben Boyd, global chair of Edelman’s corporate practice, said, “Through our 13 years of studying trust through the Edelman Trust Barometer, we have increasingly seen an emphasis placed on individuals to behave in ways that build trust and protect reputation. As this study shows, this holds true for the investment management industry as well.”
The CFA Institute recently suggested that impact investment, a relatively new practice which unites philanthropic values with financial returns, is not well-known among investment professionals, with 66% claiming to have no knowledge of the strategy.