Remaining socially responsible investing (SRI) “Doubting Thomases” had best take a new look at this fast growing and socially impactful investment community.
“SRI assets account for $12.0 trillion — or one in four dollars — of the $46.6 trillion of total assets under professional management in the United States. This represents a 38 percent increase over 2016.”
That’s the money quote (literally) in the biennial report released at a news conference at noon today by The Forum for Sustainable and Responsible Investment via the US SIF Foundation 2018 Trends Report.
Excerpts:
“Much of the growth is driven by asset managers who now consider environmental, social or corporate governance (ESG) criteria …The top three issues for asset managers and their institutional investor clients are climate change/carbon, tobacco, and conflict risk.
“The 2018 report identified $11.6 in ESG incorporation assets under management at the outset of 2018 held by 496 institutional investors, 365 money managers and 1,145 community investing financial institutions.
“‘Money managers and institutions are utilizing ESG criteria and shareholder engagement to address a plethora of issues including climate changes, diversity, human rights, weapons and political spending’, said Lisa Wolf US SIF Foundation CEO. Additionally, retail and high net worth individuals are increasingly utilizing this investment approach with $3 trillion in sustainable assets.
“‘What the [report] shows incontrovertibly, is that investors are truly beginning to understand the value of ESG considerations as an effective means of managing risk and improving performance’, said Amy O’Brien, Global Head of Responsible investment at Nuveen, the investment management division of TIAA.”
The breadth of the SRI movement is illustrated by the range of investment vehicles with assets under SRI/ESG standards — registered investment companies, alternative investment vehicles and the community investing sector.
US SIF Foundation Trends Report’s credentials: “… most comprehensive study of sustainable and impact investing in the United States.” Reporting since 1995 when such assets totaled #639 billion to today’s total, reflects an 18-fold growth. Lead sponsors of the report: Bank of America, Bloomberg, MacArthur Foundation, MFS Investment Management and Neuberger Berman.
The SRI/ESG investment standards are moving into the investment mainstream. Among the reasons: returns are now comparable to those applying traditional investment criteria; long term valuation is becoming more popular in in era of climate change/risk management: and the young investor cohort is increasingly showing interest in positive social impact as well as asset protection and growth.
As we al know, even a Doubting Thomas can be saved.