A new survey published by Morgan Stanley’s Institute for Sustainable Investing finds that interest in sustainable investing continues to increase with the growing belief that certain investments can make a positive social or environmental impact.
The second edition of the “Sustainable Signals” survey finds 75 percent of active individual investors and 86 percent of millennial active individual investors describe themselves as interested in sustainable investing. The survey examines attitudes, perceptions and behaviors of investors towards sustainable investing and considers the broader implications for investors, corporations and governments.
“As widespread attention to sustainability continues to increase, consumers and investors alike are now more than ever factoring sustainability issues into their investment decisions,” said Audrey Choi, Chief Sustainability Officer and Chief Marketing Officer at Morgan Stanley.
“The Morgan Stanley Institute for Sustainable Investing works to drive scalable investment solutions that seek to deliver positive social or environmental impact alongside the market-rate returns that clients expect,” Choi added.
Results from the new survey identify sustainable investing trends reflecting the surging growth in the broader sustainability space. Related findings include:
Values Matter. Consciousness around sustainability has leapt from the consumer space to the investment space. According to the latest survey, investor attention to sustainability factors is now growing faster than that of consumers as a whole.
Environmental impact. Increased interest in sustainable investing occurred despite a heightened sense of market volatility, implying perhaps that in uncertain times, companies and funds with sustainable attributes may be viewed as more stable over the long run. Seventy-one percent of investors polled agreed that good social, environmental, and governance practices can potentially lead to higher profitability and may be better long-term investments.
Focus on Customisation. The poll showed a strong desire for the ability to customise sustainable investments. Eighty percent of individual investors, and 89 percent of millennials, are interested in sustainable investments that can be customised to meet their interests and goals.
Sustainable Investing in the Workplace. With millennials projected to make up 75 percent of the American workforce by 2025, it’s interesting to note that nine out of ten millennial investors (90 percent) expressed interest in pursuing sustainable investments as part of their retirement savings portfolio. This implies that offering sustainable investment funds as Superannuation options may be an additional way for companies to attract and retain millennial talent in competitive job markets.
Millennials continue to fuel growth. Nearly nine out of ten millennials surveyed (86 percent) are interested in sustainable investing, compared with three-quarters of individual investors overall (75 percent). This heightened interest is likely tied to millennials’ strong belief that they can make a positive difference with their own investments. Related findings from the survey include:
Influence. 75 percent agree that it is possible for “my investment decisions to influence the amount of climate change caused by human activities," compared with 58 percent of the total individual investor population.
Impact. 84 percent agree that it is possible for “my investment decisions to create economic growth that lifts people out of poverty," compared with 79 percent of the total individual investor population surveyed.
Click here for more information and to see Sustainable Signals: ‘Millennials Drive Growth in Sustainable Investing article’ published on 9 August 2017.