Sustainable Investing Goes Mainstream, Survey Finds

A new survey from the Morgan Stanley Institute for Sustainable Investing and Bloomberg found out that 75% of U.S. asset managers say their firms now offer sustainable investing strategies, up from 65% in 2016.

Moreover, 89% of the 300 respondents at U.S. asset management firms with at least $50 million in client assets say sustainable investing is here to stay with 63% expecting it to grow over the next five years and 2 out of 3 claiming it is possible to maximise financial returns while investing sustainably.

“The survey results demonstrate that sustainable investment strategies are now a strategic imperative,” said Matthew Slovik, Head of Global Sustainable Finance at Morgan Stanley. “It is clear that asset managers will continue to invest new resources and expand their product portfolios in the coming years.”

Among key drivers of success, asset managers include increased investment stability, high client satisfaction, product popularity and possible high financial returns.

“As investors increasingly consider sustainability factors across asset classes and investment products, we expect to see a shift toward better data tracking and reporting mechanisms,” noted Curtis Ravenel, Global Head of Sustainable Business & Finance at Bloomberg. “This will increase credibility and improve measurement of impact across portfolios.”

The survey, which builds on a previous Morgan Stanley and Bloomberg survey and interview series first conducted in 2016 titled, Sustainable Signals: The Asset Manager Perspective, also points out that respondents report their firms will devote more resources to sustainable investing in the next two years. Common strategies for developing in-house skills and capacity include employee training (41%), dedicating more employee time (36%) and specialist hires (34%).

However, 7 in 10 asset managers agree that the industry lacks standard metrics to measure the nonfinancial performance of sustainable investments.

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