11 Oct The Responsible Investment Brand Index 2019
Assets and awareness of Responsible Investment continue to rise – yet asset managers still struggle to express their often-good intent through their brand.
Recent years reveal an unmistakable trend towards responsible investing and growing awareness of the importance of Environmental, Social and Governance (ESG) investment. Now in its second edition, the H&K Responsible Investment Brand Index (in short RIBITM) has once again analysed over two hundred European asset managers with a view to validating whether their good intent is also communicated through their brand. The index evaluates actual commitment against follow-through in brand architecture and offers even sharper insights.
Distinguishing between genuine long-term commitment to sustainable investment in its larger sense and companies who just ride the hype for their own benefit is hard. The RIBI differentiates between two categories: “Commitment”, which refers to the commitment made towards responsible investment, and “Brand”, which analyses to what extent sustainable development lies at the heart of a company’s identity.
The flurry of public awareness around ESG does not yet translate into action for the asset management industry
Half of all evaluated asset managers (109) fall into the Traditionalist category, committing to Responsible Investment but not translating this commitment into their brand. A third (72) are neither committing to Responsible Investment nor demonstrating RI activities through their brand.
“So, while public and regulatory pressure and a clear exposure to media is on the rise, there is no apparent traction yet in how asset managers connect their RI actions to their brand, and more importantly, to a greater social good – ie. their purpose,” explains Markus Kramer, Co-Founder of the H&K Responsible Investment Brand Index, partner at boutique brand consultancy Brand Affairs and author of the “The Guiding Purpose Strategy, A Navigational Code for Brand Growth.”
“The industry still thinks and works by and large numbers only”
The industry is making slower progress than the level of media noise would indicate
Many Asset Managers still fail to articulate why they exist when evaluated against a socially relevant Purpose. The index revealed that only 11 managers reached the maximum qualitative rating of what truly qualifies as a well-articulated Purpose. On a positive note, 29 managers (13%) have a Purpose connected to societal ambitions. Only five managers managed to craft and align a very well-expressed Purpose that clearly goes beyond monetary returns and addresses greater social good. “Even though five is a small number, this is an improvement on last year when we found only three in this category”, explains Kramer.
The authors of the Responsible Investment Brand Index, therefore, argue that leadership in Asset Management should make finding, articulating and communicating Purpose a strategic priority. “Especially in a world that is becoming increasingly transparent and competitive and where sustainability is on everyone’s lips, a clear definition of one’s own values and vision is the key to a successful Responsible Investment branding and long-term business success,” states Kramer.
“It’s not just about how the sector evolves, but how people think, communicate and act”
The H&K Responsible Investment Brand Index (RIBITM) has been developed to find out which asset management companies act as responsible investors and commit to sustainable development to the extent that they put it at the very heart of who they are: ie. in their brand. The index focuses on asset managers active in Europe. It aggregates the analysis of all 220 European asset managers listed in the Investment & Pensions Europe Journal Top 400 ranking as of December 31st, 2018.
For more details on the methodology, please refer to the Web site www.RI-brandindex.org
About the Authors
Jean-François Hirschel is the founder and CEO of H-IDEAS, a company which aims at re-establishing trust in the financial world. His professional expertise lies in strategically positioning financial services companies at brand and product level. Hirschel has held senior leadership positions at Société Générale and Unigestion. He holds a MSc from EPFL Lausanne, Switzerland, and has profound knowledge and experience in Institutional, Private and Retail Banking & Asset Management.
Markus Kramer is a partner at Brand Affairs, a specialist consultancy with expertise in strategy positioning and brand building. He holds an MBA from the University of Oxford and is a visiting Senior Fellow in Strategic Brand Management at Cass Business School London. Kramer is author of the book The Guiding Purpose Strategy, A Navigational Code for Brand Growth.