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2010 Trends Report: Socially Responsible Assets Grow Despite Financial Crisis

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

The full report is not available on SIF’s site, but more details on the key report findings can be found in SIF’s press release and the Executive Summary is available free of charge.

Image Credit:   Oldmaison via Flickr under CC license.

Written by Emily DeMasi

Emily McKinin DeMasi is a 2011 MBA/ MA Public Policy candidate and Peace Corps Fellow at Duquesne University in Pittsburgh, PA. Her thesis work concerns Corporate Social Responsibility in the United States. She also works as a Research Fellow at Bridgeway Capital, a Community Development Financial Institution (CDFI) in downtown Pittsburgh. Emily has worked as an Associate in a Private Equity Placement Firm in NY and as a Water and Sanitation Volunteer in Ivory Coast, West Africa. She hopes to combine her business background with her passion for development and inspire others in the fields of Sustainability and CSR.

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