I am really glad to obtain the chance to work with Nordea on this project, and under the guidance of Prof. Harviainen to help young people have a better understanding and carry out sustainable investing and investment insurance. Increasing their ability of financial resistance to risks will make young people’s future lives more secure and sustainable, and allow them to live a better life. Guaranteeing the lives of young people also means that guarantee the future and the social harmony, stability, and sustainable development of the world. However, the first and most important is to understand what is sustainable investing.
What is sustainable investing
According to CFA Institute, sustainable investing, also known as socially responsible investing, is the process of incorporating environmental, social, and governance (ESG) factors into investment decisions to improve long-term outcomes. Individuals who invest in companies, organizations, and funds with the goal of providing verifiable social and environmental benefits in addition to a financial return choose to invest sustainably. Impacts may be found in a variety of areas, including renewable energy and climate change, as well as health, safety, and community development. Sustainable investment may be considered as part of the evolution of investing in several ways. Industry players are increasingly recognizing that some ESG aspects are economic considerations, especially in the long run, and that it is thus critical to integrate meaningful ESG elements(CFA Institute).
Individuals may choose investments based on their values with sustainable investing. Initially, sustainable investing screened firms and sectors adversely, leading investors to forego rewards in favour of value-oriented investments. However, in recent years, investors have employed positive screening of ESG risk variables to construct a contemporary “best-in-class” investing strategy that often outperforms market benchmarks. As fiduciaries attempt to serve their clients by not just creating returns, but also measuring impact, this trend toward market outperformance in various sustainable investment products has contributed to a rise in demand for these products.
Why do young adults need sustainable investing
With an estimated addition of 2 billion people by 2050, global demand for food, water and energy will drive the need for innovative improvements in infrastructure to address the resource demand associated with a growing population(Saviolo et al, ). Water and sanitation, energy generation and distribution improvements, enhanced health care, and more efficient transportation all give a plethora of prospects for long-term investment development. As these investments continue to display a track record of market outperformance, Investors of all types will want solutions that not only outperform but also correspond with their values from their wealth and asset managers.
Young individuals, who wish to invest in line with their particular principles, are driving demand for sustainable investments. A recent study by Morgan Stanley shows that young adults are expected to inherit more than $30 trillion over the next several decades from their baby boomer parents and grandparents (Morgan Stanley, 2015). Sustainable investing will continue to be in high demand. As a result, fund managers are devoting more resources to product development in order to capture these new client demographics. Young adults are integrating their money and ideals by pursuing personal fulfilment in their employment, purchasing with a global mindset, and investing in long-term, beneficial business models.
How to capture young adults’ eyes on sustainable investing
In this project, Nordea is also reluctant to give up this piece of cake, aiming to occupy young adults segmentation through products focusing on sustainable investing such as Nordea Capital. However, they have not yet discovered a viable strategy for attracting young investors to purchase their products. Nordea and youngsters are experiencing communication difficulties as a result of information asymmetry. How can Nordea arouse the attention of young adults in sustainable investing and investment insurance and how can Nordea be seen as a responsible and interesting organization by young adults? These are also the fundamental issues in the wicked problem.
We might use methods like gamification, visual design and sound design to optimize the website and the application of Nordea. Making them more accessible, more charming, interesting and gameful to attract their attention and deliver the information to every young adult. Let them know a good investment is the accelerator of life. Even though most of us work hard, if there is no special opportunity, we will only be ordinary members of hundreds of millions of working-class throughout our lives, and we can only earn the average wage income of the society. However, investment has opened a door of opportunity for us, ordinary people. That is why young adults should come and cooperate with Nordea which can help them save and invest money in a smart and sustainable way.
CFA Institute. What Is Sustainable Investing? <https://www.cfainstitute.org/en/research/esg-investing/sustainable-investing>
Stefania Saviolo, Gianmario Borney (2021). Branded Supply Chain: A New Perspective in Sustainable Branding
Morgan Stanley (2015). The $30 Trillion Challenge. <https://www.morganstanley.com/ideas/30-trillion-challenge>