Concerns have been raised that consideration of environmental, social, and corporate governance (ESG) issues in investment decision-making could suffer in the aftermath of the financial crisis and the lingering economic recession, however the 2010 Trends Report published by Social Investment Forum (SIF) indicates that this is not the case. In fact, growth in sustainable assets outpaced mainstream assets according to the press release on SocialFunds.com. Key findings of the report show that sustainable, or socially responsible investing (SRI) can no longer be considered just a niche, a thought voiced by Lisa Woll, CEO of SIF.
The 2010 Trends Report shows that while mainstream assets have grown by less than one percent since 2007, sustainable assets have grown by 13%, proving that ESG factors are still of concern for investment decision-making despite times of economic hardship. Other key findings of the report include:
- Since 2005, SRI assets have increased more than 34 percent while the broader universe of professionally managed assets has increased only 3 percent.
- Nearly one out of every eight dollars under professional management in the United States today is involved in some strategy of socially responsible and sustainable investing.
- The total value of assets managed under policies that explicitly incorporate environmental, social and governance criteria into investment analysis and portfolio construction are valued at $2.51 trillion.
According to the SocialFunds.com press release, the report identifies a number of drivers for the increase in responsible investment such as:
- client demand (money managers are increasingly incorporating ESG criteria in response)
- more active targeted divestment or active engagement on certain investment issues like human rights by institutional investors and money managers
- Investment products with environmental themes
- legislative and regulatory developments
- growth of investor networks
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