Published on August 17th, 2017 | by Joshua S Hill0
Millennials Are Driving Global Sustainable Investment
August 17th, 2017 by Joshua S Hill
A new investor survey conducted by leading global financial services company Morgan Stanley has revealed that three-quarters of investors and 86% of Millennial investors are interested in sustainable investing.
The second edition of the Morgan Stanley Institute for Sustainable Investing Investor Survey, Sustainable Signals, surveyed 1,000 individual active investors and examined the attitudes, perceptions, and behaviours of individual investors towards sustainable investing. The highlight findings from the report are that 75% of those surveyed and 86% of Millennial investors consider themselves interested in sustainable investing.
The first edition of Sustainable Signals was published in 2015, at which point 71% of those polled and 84% of Millennials were interested — seemingly a small increase. What’s interesting from the 2017 Sustainable Signals survey is that Millennials who consider themselves ‘Very Interested’ increased from 28% in 2015 up to 38% in 2017 — an increase that Morgan Stanley considers a “statistically significant change.”
“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.”
The report further highlights the fact that Millennial investors are twice as likely as the overall pool of investors surveyed to invest in companies or funds that specifically target social or environmental outcomes. No doubt, the increase in Millennial investor interest in sustainability is at least partly responsible for the spike detected in US sustainable, responsible, and impact investing between 2014, which grew at a rate of more than 33%, increasing from $6.57 trillion up to $8.72 trillion.
The survey focused on sustainable investing and expanded its questions to include:
- What issue-areas/themes are investors most interested in investing in?
- To what extent are investors interested in investing locally vs. nationally vs. globally?
- Is it an investor’s responsibility to do anything other than maximize profits?
- Do investors prefer sustainable investments that have an overall positive impact on social and environmental issues or those that are customized to their own interests and goals?
- To what extent do investors believe that sustainability and financial gains are a trade-off?
Millennials also expressed increasing interest in pursuing sustainable investments as part of their 401(k) portfolios — 90% of those surveyed.
The report also identified that influence and impact are key aspects to the Millennial interest in creating sustainable investments. 75% of respondents believe that it is possible for “my investment decisions to influence the amount of climate change caused by human activities,” compared with only 58% of the larger group of investors surveyed. Similarly, 84% of Millennials believe that it is possible for “my investment decisions to create economic growth that lifts people out of poverty,” compared with a healthier 79% of the total investors surveyed.