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Title:Sustainable savings and investments in Belgium: Still a vibrant market
Date of publishing:October 06, 2014
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Category:News
Language:English
Also available in the following languages:Dutch, French

Sustainable savings and investments in Belgium: Still a vibrant market
October 06, 2014

PRESS RELEASE 6 OCTOBER 2014

 

Financial institutions and market scan make a considerable contribution to sustainable development, including through the provision of sustainable investment and savings products.  

For the thirteenth consecutive year Forum Ethibel has actualised the time series on sustainable savings and investments in Belgium, a study commissioned by MIRA (Milieurapport Vlaanderen – Environmental report Flanders).

End 2013 the volume in sustainable savings increased by 7% compared with 2012. Sustainable investments, on the other hand, decreased by 11%. The final maturity of a specific type of funds is what causes this decrease.

Market trend alternating between growth and decline

A sustainable savings product (1) avoid controversial activities, (2) reinvests in economic activities with an added value for man, society, environment and/or (3) supports sustainable or solidarity project by means of a commission or a profit transfer.

Sustainable savings increased in volume, though no longer exclusively through the so called solidarity levy. This is the supporting of social or sustainable project by means of a financial contribution. Moreover, the icon of solidarity savings, Cricket Savings, disappeared from the market. The increase of sustainable savings in Belgium is largely attributable to banks making a more direct and thorough commitment, written down in socio-ethical codes. Subsequently their balance sheets are audited to monitor the compliance with these codes. In that way practically all of their loans and investments are on the radar instead of only a few specific green financing projects. Each year they report on their progress and impact, thereby giving a clearer picture of the financial IN/OUT of the bank.  

An increasingly mature market

An investment is sustainable if it only invests in companies that meet social and environmental criteria, and are not involved in highly controversial activities. Sustainable investing still flourishes in Belgium. As a result our country remains one of the top performers at European level.

The decline in the volume of sustainable investments is not at all a negative evolution. A close analysis shows that there is just one category of ‘light products’ reaching its maturity date. Capital guaranteed funds used to be very popular in the past, but have lost popularity over time. Their sustainable versions only offered a  weak sustainable basis. As a result, there is thus no loss of quality, on the contrary. This apparent status quo rather hides a vitality as there are plenty of new products being launched with a high diversity. 

A big part of the transition to sustainable investment remains statistically hidden. Big parts of the institutional markets are reluctant to provide numbers. These markets also follow a ‘slower’ and more cautious course as they generally have a bigger responsibility on the ‘return on investment’ as is the case with ‘consumer funds’. Hence, insurance companies, pension funds and institutional investment institutions apply transition scenarios. Practice shows that sustainable investing can contribute to a better risk-return profile of, for instance, pension funds.

3,05 billion euros in sustainable savings

In Belgium, sustainable savings was launched in 1984. At the end of 2013 financial institutions gathered 3,05 billion euros in sustainable savings. The total deposits of all savings accounts in Belgium amounted to 266 billion euros. As a result, sustainable savings had a market share of 1,15%. After more than 25 years sustainable savings remains marginal, though it has a substantial potential.

7,7 billion euros in sustainable investment products

From 1995 to 2013 the total assets under management for sustainable investment products in Belgium increased from 8,9 million euros to 7,7 billion euros. Only few countries had a similar strong development with respect to sustainable investing. Even during the financial and economic crisis the market of sustainable investing grew in Belgium. On the other hand the market has shrunk since 2011. In 2013 the assets in sustainable investment products fell by 23% compared with 2011. The total Belgian market of Collective Investment Institutions (CII) grew with 10% in 2013, totaling 117,5 billion euros. The market share of sustainable investments fell from 8,1% in 2012 to 6,5% in 2013.

 

Documents (in Dutch) and contacts

Read the full report ‘Sustainable savings and investments in Belgium: actualisation till 2013

MIRA-indicator Sustainable investing

MIRA-indicator Sustainable savings

MIRA-indicators Environment & Economics

More information on Funds with a sustainable profile holding a license for the Belgian market (2013)

Contact MIRA: Nathalie Dewolf ()

Contact Forum ETHIBEL: Herwig Peeters () (0478 44 14 78)
The complete set of numbers and research data are available on demand: