This collaboration introduces an innovative solution to support wealth managers and financial advice firms in aligning investor portfolios with personal values and sustainability goals, leveraging a state-of-the-art behavioural finance tool developed by Oxford Risk, and factual ESG impact data and investment solutions offered by Impact Cubed.

Addressing the Misalignment in Sustainable Investing

To showcase just one synergy of the partnership, Impact Cubed and Oxford Risk have highlighted a significant gap between investor demand and solutions — many Sustainable Development Goals (SDGs) are underrepresented in available investment products.

The research integrated investor SDG importance scores from Oxford Risk’s research, with Impact Cubed’s analysis of the number of funds having more than 20% revenue alignment to each specific SDG. The findings reveal an intriguing disparity: several SDGs highly valued by retail investors are significantly underrepresented in available investment funds. Notably, Clean Water and Sanitation and, perhaps more surprisingly, Climate Action, are among the top-ranked SDGs with a substantial gap between investor interest and fund availability.

Some other findings include:

• Good Health and Wellbeing: This SDG has robust market coverage with numerous funds aligning over 50%.

• Affordable and Clean Energy: Popular among investors, yet underrepresented in fund availability.

• Quality Education: Highly valued by investors but lacking in sufficient fund options.

• Responsible Consumption and Production: Investor interest is high, but the fund market does not match the demand.

• Life Below Water: Not many funds align with this critical SDG.

Tailored Investment Solutions by Impact Cubed

Where gaps in the market exist, such as the opportunity to develop a fund focused on Clean Water and Sanitation, Impact Cubed’s custom portfolio solutions come into play. With deep expertise in quantitative asset management, they design bespoke investment strategies that align with specific SDGs and investor goals, ensuring even the most niche sustainability objectives are met, in a risk-controlled manner.

"Chris Lee, Head of Marketing at Impact Cubed, states, “Our partnership with Oxford Risk tackles a critical challenge in sustainable investing: bridging the gap between investor preferences and the availability of suitable funds. By harnessing the sophisticated preference-gathering capabilities of Oxford Risk with our extensive ESG mapping capabilities, we can provide actionable, value-aligned investment recommendations.” He continues: “This initiative empowers investors to make decisions that are financially sound and aligned with the global sustainability agenda.”