Millennials value sustainable investments
Updated: Jan 29, 2020
A younger generation of investors, who overwhelmingly believe that their investment decisions can make an impact, is leading the sustainable investing charge.
More investors are interested in sustainable investing and adopting its principles as part of their strategy, but Millennials are leading the charge, according to the Institute for Sustainable Investing’s 2017 “Sustainable Signals” report. As with the previous report in 2015, this latest survey of 1,000 total active individual investors tracked both how investors perceive sustainable investing and whether they are acting on that interest.
On a personal note, I have been struggling finding truly sustainable investment opportunities, so I am definitely excited to read these statistics that there are more and more investors who believe that getting a good return and doing good can go hand in hand. I will share some key figures stated in the report.
As you can see in the table, there has been a significant increase (15%) where Millennials indicate their interest in sustainable investments as being very important compared to 2015.
Millennials are twice as likely to make investments focussing on social or environment impact, compared to the total population and they also believe their investment can make a difference in climate change and lifting people out of poverty.
Generally speaking women show more interest in impact investing compared to men (85% vs 67%) however when it's about taking action there is no significant difference (40% vs 36%).
In the US, Sustainable Investing assets under management are growing:
Sustainable, responsible and impact investing rose 33% between 2014-2016 to $8.72 trillion.1 (Source: The Forum for Sustainable and Responsible Investment: "2016 Report on U.S. Sustainable, Responsible, and Impact Investing Trends.")
However, to grow faster some "myth busting" is needed as 53% of of investors still believe sustainable investing requires a financial trade-off.
Over the last two years, interest in sustainable investing has grown. The idea continues to draw strong support, and familiarity with it only appears to be spreading. Investors largely believe that their portfolios can have substantive social and environmental impact. As long as the need for such impact remains, it is likely that investor interest will keep rising.
Full Report and image source: https://www.morganstanley.com/pub/content/dam/msdotcom/ideas/sustainable-signals/pdf/Sustainable_Signals_Whitepaper.pdf