“This market leadership can come from fund groups, consultants and wealth managers. Asset managers should open up their intellectual capital in this space to guide advisers through the ESG journey.”

Opportunity or crisis?

Regardless of which outsourcing option advisers choose, things are going to be different, as Mr Medlock explains: “Whichever way you look at this, many advisers are facing a change in how they conduct business.

“This isn’t simply a case of bolting on a few extra questions into the fact-find and completing some box-ticking.”

ESG, as a consideration, needs to become embedded at an adviser proposition level. The evidence suggests that clients really care about this; particularly the younger generations, as well as females as a broad demographic.

Mr Medlock adds: “This is not only a means of generating new clients but a means of servicing the changing needs and values of existing clients.

“One of the most important steps that advisers will need to take on this journey will be educating and transitioning their clients through all of the ‘noise’.

“But if you look at the prominent headlines from 2020; Covid-19, extreme weather events, ethnic diversity – they’re effectively presenting advisers with a unique opportunity to engage with clients on a wide range of ESG issues.”   

Ms Boyle also believes that the greater focus on ESG could herald positive change for advisers: “There’s a growing understanding that businesses not only have a responsibilityto their clients and employees, but also to the wider world around us.

“It’s an opportunity to think big and be ambitious for your business, clients and the impact on the world.” 

Fiona Nicolson is a freelance journalist

This column is sponsored by Aberdeen Standard Capital