Responsible investing is no longer a "nice to have". Be it for regulatory reasons, in response to effective demand or perhaps even out of an awareness of one's own responsibility. Regardless of which sustainable shades of green you have in mind; the topic is more relevant than ever.

However, complexity has increased significantly in recent years. For example, due to the weak performance of traditional ESG sectors and constantly changing regulation. But the extreme competition in this area also plays a key role. Investment clients find themselves in a veritable labyrinth when it comes to making the right choice from tens of thousands of providers. In this context, one's own identity and underlying convictions can make all the difference.

Convictions and decisions

In the complex world we live in, clients rely on the convictions and decisions of asset managers. They want to know whether the company they want to work with is in line with their beliefs, their goals and, above all, their values.

This applies not only to investments, but also to the responsibility that is assumed. The times when the term "ESG" worked as a point of differentiation is over. To survive in the market, win new customers and retain existing ones, it is imperative to constantly scrutinise your own identity in terms of clarity, your own convictions and consistent communication about your own brand. Because your own "brand" is far more than just your logo. Your brand reflects your convictions, your identity and your culture both internally and externally.

Objectifying the subjective

The Responsible Investments Brand Index (RIBI™) has been assessing the ability of asset managers to express their commitment to responsible investment in their brand for six years. In the current edition, 600 asset managers worldwide were analysed, enabling a comprehensive comparison in terms of both the number and diversity of companies.

RIBI objectively compares brand identity using a method based on 25 years of experience and expertise in brand strategy by Markus Kramer and Jean-François Hirschel in the field of asset management. The criteria analysed are just as precise as the parameters on which the evaluation is based.

The RIBI ratings enable asset managers to set their priorities more clearly, build on their strengths and target potential for improvement. RIBI is also a unique tool for companies that select asset managers. The index shows how well an asset manager expresses its convictions in relation to responsible investing through its brand. This makes the RIBI a tool that can help to improve coordination between the various players and promote trust in the sector, and the economy in general.

Large companies and boutiques on an equal footing

The 10 leading asset managers worldwide that achieved the best result in the 2024 edition of the RIBI are all European companies. This is a trend that has already emerged in previous editions. It is interesting to note that the top 10 include both large companies and boutiques. This indicates that the coherence between responsible investment and the brand depends primarily on the convictions, beliefs and strategy of the decision-makers, and not on the size of the company or its marketing budget.

Even though RIBI refers to the universe of asset managers, we are convinced that the findings can be applied to the entire financial industry.

Clarity about one's own identity and consistent decisions based on this enable clear differentiation in a highly competitive market. This creates alginment, understanding and a shared understanding of values between provider and customer. This in turn creates trust and thus the basis for a long-term relationship. The clarity of your own brand protects your reputation. Because if you say what you stand for, you also say what you don't stand for. In addition, brand clarity is also an excellent way to attract the talent you need to succeed: Employees who align with your values are and will be your best ambassadors.

To summarise, in an increasingly turbulent world, your brand should be a unique stabilising factor and an excellent figurehead. Have the courage to not be everything to everyone - and stay the course!

The original article by Jean-Francois Hirschel and Markus Kramer was published on SPHERE on 28 May 2024