CSR Just PR Spin - Report
1 May 2013 at 10:50 am
Social responsibility is “nothing more than public relations”, according to some respondents in a study of Ultra High Net Worth (UHNW) investors.
According to the 2013 UHNW Investor Changing Attitudes and Behaviors study, these wealthy individuals appear to be increasingly unlikely to become socially responsible and instead invest primarily for financial gain and not to make the world a better place, according to new research from the Spectrem Group.
The report says that the UHNW investors appear sceptical of a company’s claims to be socially responsible, considering it to be “nothing more than public relations”.
40% of participants said that a corporation should “focus on generating profit and allow investors to decide whether to use the gains for the greater social good.” A similar number indicated they have never "given much thought" to socially responsible investing.
Less than 20% of the UHNW factor social responsibility into their investment decisions, giving much greater weight to the risk associated with an investment (94 percent), diversification (89 percent) and tax implications (81 percent), according to our research.
UHNW investors respondents rated their interest in socially responsible investing as a ‘44’ on a 100-point scale with zero indicating less interested than five years ago and 100, more interested.
Younger investors – those ages 46 and younger – proved an exception to this trend by rating their interest as a ‘54’.
UHNW investors are those with $5 million – $25 million in net worth, not including their primary residence. Some 500 American respondents took part in the survey.
However, an initiative launched by Warren Buffett and Bill and Melinda Gates in 2010 called The Giving Pledge invited the world's wealthiest individuals and families to commit the majority of their assets to philanthropic causes in an effort to help address society's most pressing problems. So far, 105 high-net-worth households have joined the Pledge – 81 of them from the US.
According to the Pledge organisation, the combined net worth of roughly $490 billion in commitments made by the current participants could bring more than $245 billion to charity.