I compare survey data on preferences and beliefs between finance professionals and the public, including students. The survey measures risk preferences, time preferences, preferences regarding environmental, social, and governance (ESG) investments, and beliefs about the financial performance of ESG portfolios. Finance professionals were also asked to predict the preferences and beliefs of the average individual in the public, i.e., second-order beliefs.


The results reveal five main findings. First, finance professionals differ systematically from the public: they are more risk tolerant, more patient, more time-consistent, and place greater weight on ESG performance than on financial returns in their own investment decisions. Second, despite these differences, they accurately predict the average preferences of the public. Third, second-order beliefs about ESG motives diverge from personal motives: finance professionals expect the public to prioritise financial performance, whereas students expect the public to prioritise ESG performance. Fourth, both groups believe ESG portfolio returns and volatility resemble the broader market, but they also think the public expects lower returns and higher volatility. Finally, personal preferences and second-order beliefs are correlated for time preferences and portfolio characteristics, and ESG motives are positively associated with beliefs about ESG returns.