‘We need to celebrate risk’: City minister pushes for Brits to embrace investment
The City minister Andrew Griffith said today the UK needs to “celebrate risk” as he called for a sweeping culture change in the way the public approaches investment.
Speaking at a Conservative Home pensions and investment event this morning, Griffith said Brits were being blocked from potential bumper returns due widespread aversion to risky investments.
“Risk is the lifeblood of the economy,” Griffith said. “We need a culture change to be positive about taking risks, to celebrate risk takers, even if a side effect is that they become wealthier as a result.”
Griffith also rowed in behind calls to “make equities sexy again” and boost retail investment interest in the mould of the US, after the chief of Aquis first issued the call in City A.M. last week.
Top City figures have been urging amateur punters to edge back into the stock market in recent months, with M&S chair Archie Norman calling for an overhaul of shareholder engagement to help boost retail investor involvement.
“I agree with those who say we need to make equities sexy again,” Griffith said.
“Americans may not understand football but they have a much smarter culture of personal investing,” he added. “In the US, you find people talking about their 401Ks or individual retirement accounts at a bar or at a barbecue in a way that simply unimaginable here.”
Griffith’s comment also points to an ongoing debate in the Square Mile over how to invest UK savers’ pension cash. Top City figures have called for more UK pension money to flow into UK listed companies to help fill a funding gap and boost the flagging valuations of companies.
Pension funds holdings of UK listed companies have plummeted over the past two decades as trustees direct fund managers away from riskier equity investment towards bonds.
Just four per cent of the UK stock market is now held by pension funds – down from 39 per cent in 2000, according to a report from think tank New Financial.