Cost is stopping many people choosing environmentally friendly options

Many people who want to choose greener and more environmentally friendly options can't afford it, recent research has found. 

New sustainability research published by Banking & Payments Federation Ireland (BPFI) has revealed that while the majority of consumers indicate that they want to make more sustainable finance and purchasing choices, their sustainable intentions are often outweighed by factors such as cost and other practicalities.

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Published ahead of BPFI’s inaugural Sustainable Finance Conference, which will be opened today by Minister for the Environment and Climate, Eamon Ryan, the survey looked at the role that sustainability plays for consumers making decisions on savings and investments and car purchases, as well as the importance of energy efficiency when deciding on a buying a home.

Key findings from the survey show:

• 30% of adults said they planned to buy a car in the next year with 45% of those planning to buy an electric or hybrid electric car.
• When asked about the various factors that would influence their decision when buying a car, only 32% of respondents said that fuel emissions would influence their decision to buy. In contrast by far the most important factor was price (cited by 81%) followed by reliability (57%) and insurance (47%).
• In terms of attitudes to savings and investments, 58% of adults agreed that it is important that their savings and investments do not fund economic activities that have a negative impact on the planet, while 56% said they would be more likely to invest in a product if they knew it was sustainable.
• A much higher proportion of younger adults (18-24) agreed that they would invest in a sustainable financial product at 70% compared to older adults (59+) at 50%.
• A higher proportion of those living in Dublin (63%) also agreed that they would invest in a sustainable financial product compared to those living in Connacht (50%).
• When it comes to buying a home and the importance of a good Building Energy Rating (BER) when choosing a property, over half of (53%) adults said it is very important but this dropped to 40% of younger people (18-24 year olds) and 37% of those currently living with friends and family.

Speaking on the publication of the survey, Louise O’Mahony, Head of Sustainable Banking, BPFI stated: "Sustainability is becoming increasingly important for consumers when it comes to thinking about where they are saving, investing and spending their money. However, it is clear from today’s survey that other factors such as cost and other practicalities can dominate the decision-making process.

"For example, we can see that age is a factor when it comes to investment, with older people aged 55 or older less committed to sustainable investment compared to young people. Meanwhile, less than a third of those planning to buy a car in the next year will be influenced by fuel emissions compared to 4 out of 5 people being influenced by price. And while some 53% of adults said that a good BER rating was very important when deciding on a property to buy, only 40% of younger people rated a good BER as very important suggesting they would prioritise other factors in deciding to buy a home.”

Pointing to the role of banks in addressing the discrepancy between what consumers say they want and the decisions they make, Ms O’Mahony continued: "Banks play a vital role in supporting people to make sustainable financial choices, given their direct relationships with customers in the real economy. Today’s survey suggests that there is further opportunity to engage with customers to more closely match their interest in sustainable options with the wide range of products already available through the banks and other financial providers such as sustainability-linked loans and reduced rates for mortgaged properties with improved energy performances.

"Banks are also engaged in training their frontline staff and relationship managers to help educate customers on the benefits of sustainable products and some lenders offer green hubs, which provide practical information on sustainability and links to relevant third-party websites, case studies and details of green products and services".

Ms O’Mahony concluded: "As we kick off today’s very first BPFI Sustainable Finance Conference it is a timely reminder that we need to keep customers front and centre in our discussions around financing the transition to a decarbonised economy and ensuring no one is left behind on the climate journey". 

The BPFI Sustainable Finance Survey was conducted in March 2024 amongst a nationally representative sample of 1,000 people. The survey is published ahead of the BPFI’s inaugural Sustainable Finance Conference, Wednesday 24th April, which will be opened by Minister Eamon Ryan and will explore, with leading national and international experts, the critical role of the banking sector in financing the transition to a decarbonised economy.