Spainsif’s Garayoa: Official labels would boost Spain’s burgeoning SRI market

Spainsif, a member of Eurosif’s network, has reported double-digit growth in the Spanish SRI market, yet says more can be done to enhance this trend.

Francisco Javier Garayoa, director of the body, was speaking to RI after the launch of Spainsif’s biennial market study.

The Spanish sustainable and responsible investment market has grown 16.3%, close to €170bn in the last two years to December 2015 (€95.3bn following Eurosif’s methodology which excludes overlaps between SRI strategies).

As Garayoa put it, there are many SRI seeds planted in Spanish soil, but now the market should cultivate them to reap the benefits of responsible investment. One tool to that end could be a French-style official labeling of SRI products.

“We have to consider it at Spainsif and consult with our members. Labels are a very interesting tool, particularly for the retail sector.”

Spainsif’s study has confirmed the double-digit growth observed in the period 2011-13, where SRI assets under management grew from €70.1bn to €125.1bn (€93.2bn according to Eurosif’s 2014 study).

However, much more can be done to unlock the potential of both retail and institutional investors.

According to the study, of the €170bn figure, 47% comes from investment companies and funds (instituciones de inversion colectiva) as well as pension funds that use “at least some SRI strategy”.However, such 47% is the percentage of a niche: 18.1% of Spain’s whole investment and savings markets. The full picture is completed with traditional investment products (40%); direct investment not managed professionally (20%); insurance assets (11%) and others, Garayoa explained.

In addition, Spainsif’s study reflects data from their 58 members, about 70% of Spain’s SRI market. The other 30% still cooperates and has a close relationship with Spainsif.

The SRI market in Spain is being driven by international players, mainly asset managers: “They have the experience, expertise as well as products already developed in other markets. But markets are now global, open and in a transition driven by sustainable criteria.”

Spainsif publishes a catalogue of SRI funds, which includes the products of non-members. Out of approximately 160 funds, about 130 are offered by international asset managers.

As pointed out by Spainsif president Jaime Silos at the launch event on November 23, the findings send a strong message to Spanish investors about the need to embrace sustainable long-term approaches that transcend speculative models “dismissive of the real economy”.

In the foreword to the study, Silos and Garayoa described the current situation as “a paradigm shift” and hoped the research can shed light on the strengths and weaknesses of the Spanish SRI market.