Half of financial consumers likely to consider switching main provider if they have ethical concerns

Research by Ipsos MORI for EIRIS shows responsible and ethical finance to be a key concern to consumers when choosing a financial supplier.

Research conducted by Ipsos MORI for leading global responsible investment research firm EIRIS shows that poor performance on some responsible or ethical finance concerns is a powerful motivator for consumers in switching financial supplier. This is shown to be almost as strong a motivatiing factor as poor customer service, or a better deal elsewhere.

Key findings include:

  • If they wanted to influence financial institutions to invest in companies that behave ethically, 30% of all consumers aged 16-75 in Great Britain would be prepared to choose a financial institution that avoids investing in or lending to companies that do not behave ethically.
  • 51% of consumers aged 16-75 who have ever personally bought or taken out a financial product or service would be likely to consider switching main financial provider if they had reason to believe its financial activities (e.g. lending, insuring) contribute to harmful social activities, such as human rights abuses, child labour and forced labour.
  • Similarly, if these same consumers have reason to believe their main financial provider has faced potential fines for activities that breached financial regulations (such as money laundering regulations, mis-selling products or manipulation of interest rates), 47% are likely to consider switching, against just 13% who are unlikely to consider doing so.
  • In comparison, 62% of this group would be likely to consider switching if they were personally dissatisfied with the customer service provided by their current financial provider, while 55% would be likely to consider switching if another financial provider provided better rates, fees or conditions for a similar product or account.
  • 60% of consumers who have bought or taken out a financial product would feel negative about their main financial provider if it invested in companies where working conditions are poor for many of its employees.

Stephen Hine, Head of Responsible Investment Development, EIRIS said:

“We believe the findings from this year’s survey show that corporate performance on environmental, social, governance and ethical grounds can have a strong effect on how consumers feel about their bank or wealth manager. Leading financial product providers need to continue to develop responsible investment and lending policies, and to develop appropriate products for this growing market. This will enable providers to manage risks and make the most of opportunities from the links between reputation, responsible or ethical concerns and consumer attitudes.”

Technical Note

The research was conducted online by Ipsos MORI between 10 – 14 October 2014. The questions were asked of 2,010 Ipsos online panel members aged 16-75 across the United Kingdom. The data has been weighted to the national profile of the UK population.

 

  

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