In the news
Sustainable finance: Survey reports differences in how investors in French and German parts of Switzerland invest
Article published in Le Temps, 1 March 2023
Do all Swiss people invest in the same way? Not quite. It is even “surprising to find so many differences in such a small country,” says Andreas Arni, Head of the Swiss market at Lombard Odier. This is the conclusion of a survey conducted by the Geneva-based bank, to which some 300 wealthy individuals (with at least 1 million francs at their disposal) responded, the vast majority of whom were men, spread across all linguistic regions.
Despite differences, the advice given to clients is the same throughout Switzerland, he says. However, the survey could lead him to rethink certain aspects: “We must consider how we respond to certain concerns, particularly when it comes to greenwashing.”
Swiss Germans more decisive
“On this topic, those in German-speaking Switzerland have a stronger opinion,” says Andreas Arni. They are more sceptical that sustainable investing offers an opportunity to reduce risk or achieve higher returns. Yet in practice, German speakers are actually ahead of the game: only 15% of them have no sustainable investments at all, compared to 26% of French speakers. Half of Swiss Germans are thinking of increasing their sustainable investments, compared to one in three (34%) in the French part. Those who are extremely convinced by sustainable finance, i.e. whose investments meet this criterion by at least 80%, are mostly situated on the French side (12%, compared to 4%).
The differences and nuances can be highlighted, but in reality, the majority of the country is attracted to sustainable finance. Seven in ten respondents expressed interest, with 2022’s market downturn having done nothing to dampen their desire. “This certainly has something to do with the energy crisis: people are realising the limits of fossil fuels because of their dependence on producers, whereas renewable energies do not pose this problem,” said Andreas Arni.
Other differences are apparent in the behaviour of Swiss investors. In private equity and real estate, for example, those in the German part also seem to have a head start. Only 13% of them do not hold any investments of this type at all, compared to 36% of the French-speaking population. The reason? Andreas Arni says that Swiss Germans tend to be better acquainted with unlisted investments.
Read also: Why integrate private equity in your investments?
And more nervous?
Investors that are more nervous, or more reactive, are also mostly situated in German-speaking Switzerland. They displayed stronger reactions to the challenges of the financial markets last year, with 53% repositioning their portfolios on their own initiative, compared to 39% on the French side, the survey reveals. “As the markets recover, we have to be careful before making changes in a hurry,” says Andreas Arni, who himself is based in Zurich, where the bank employs around 150 people. In addition, half (51%) of the German-speaking population said they had increased their diversification, compared to only a third (31%) of the French-speaking population.
Important information
This document is issued by Bank Lombard Odier & Co Ltd or an entity of the Group (hereinafter “Lombard Odier”). It is not intended for distribution, publication, or use in any jurisdiction where such distribution, publication, or use would be unlawful, nor is it aimed at any person or entity to whom it would be unlawful to address such a document. This document was not prepared by the Financial Research Department of Lombard Odier.
Read more.
share.