Interest in Sustainable Investments a Characterisation Exercise of Italian Investors Based on CONSOB Surveys

Abstract

This paper analyses the individual characteristics that are associated with interest in sustainable investments as reported by participants in the 2019 and 2021 waves of the surveys of the CONSOB Observatory on 'Approach to Finance and Investments of Italian Households'. In line with the insights of the economic literature, interest is positively correlated with multiple features, such as the level of education and the robustness of the economic-financial situation, perceived knowledge of sustainable investments, financial knowledge, and digital knowledge, personal traits such as: social preferences; propensity for financial control; investment experience and holding of a diversified portfolio. Conversely, interest is found to be negatively correlated with age, risk aversion, and liquidity holding. The work provides empirical evidence that may be useful for the elicitation of investors' sustainability preferences, which the most recent European regulatory developments require as part of the suitability assessment to be carried out by investment firm offering investment advice or portfolio management services. The analysis provides useful indications with respect to the design of 'financial eco-literacy' initiatives and financial education, in particular with regard to segmenting the target audience of the initiatives and defining the training content.

Keywords: retail investors, sustainable investments, sustainability preferences, personal finance, financial advice, financial knowledge, financial education

JEL Classification: D14, D91, G11, G41, G53