Most investors plan to increase their ESG investments within the next year or two
WashingtonAnd October 12 2021 /PRNewswire/ — Nearly 8 in 10 investors (78%) expect to add an ESG-focused investment to their portfolios over the next year or two, according to a new nationwide survey released today by Personal Finance from Kiplinger Magazine in partnership with Domini Impact Investments LLC.
Investing in ESG, defined in the survey as “looking at a company’s track record of environmental practices, social issues, and governance policies before investing,” resonates with younger investors: 91% of millennial investors say they are likely to They are adding these investments to their portfolio soon, compared to 80% of Gen X investors and 68% of Baby Boomer investors. Investing in ESG is also sometimes referred to as sustainable, impactful, values or socially responsible investment.
Overall, more than 70% of respondents say that a company’s environmental practices, management of social issues, and governance policies are very or somewhat important to them when choosing investments. And 41% say they have already invested in stocks or bonds to try to address these issues. Kiplinger and Domini surveyed 1,029 investors aged 25 and over to find out their views on ESG, what issues they care about most, and how they prefer investing.
“Investors increasingly want to make a difference,” he said. Mark Solheim, editor Personal Finance from KiplingerBy choosing to invest in companies that can not only increase their profits, but also have a positive impact on their employees, shareholders, society and especially the planet.
The majority of respondents generally believe that investing in ESG can make a difference in the way companies do business: But 75% of Millennium investors think this is the case, followed by 58% of Gen X investors and about half (47%) Baby boom investors. And when asked to choose an ESG investment target they cared most about, they cited the environment more than other options:
35% want to make a positive impact on the environment
24% want to build a better future for everyone
15% want to invest in their local community
12% would like to avoid investing in industries such as weapons, fossil fuels or for-profit prisons
8% want to create more diversity in the workplace
6% want to pay social justice
“The good news is that companies like Domini can help people align their investments with their values,” he said. Carol Label, CEO of Domini Impact Investments LLC. “With our decades of experience, we apply our environmental and social standards on behalf of the thousands of investors who come together in our mutual funds and bonds to advance environmental sustainability and global human dignity.”
Encouraging clean energy to mitigate climate change (19%) and avoid depletion of natural resources and protect ecosystems (18%) were the two most important environmental outcomes for an ESG investor. Notably, baby boomers were more likely than millennials or Generation Xers to identify the depletion of natural resources as the most important.
How do people invest?
When it comes to investing focused on ESG, most respondents say mutual funds are the way to go. Almost half of all respondents (49%) would choose them over other types of investments. A greater percentage of baby boomers (58%) say this is their preferred strategy.
Moreover, three-quarters of them say they would like to invest in an ESG fund through a workplace retirement plan. More than half (53%) say having this option will have a positive impact when evaluating the offer of the benefits package. This was the highest for millennials, with 72% considering it a plus.
While survey respondents indicated a general enthusiasm for ESG investments, they did point out some factors that could prevent them from making a larger investment in ESG stocks, bonds or funds. These include performance concerns, but also:
There is not enough information about potential investments
Potential for the company to make a false claim about ESG
Uncertainty about how to start investing in ESG
“We are encouraged that our mission and exclusive focus over the years have become even more important to investors and businesses alike.” Carol Label. “Hopefully we can help make ‘Investing for Good’ the way all investing is done.”
What is clear is that the staying power, popularity, and proliferation of ESG funds are anything but a given. When asked their opinion about the future of investing in ESG, only 11% of respondents indicated that they believe investing in ESG is a fad that will fade over time. Nearly two-thirds believe investing in ESG will continue to grow in popularity or push more companies to adopt ESG principles.
Kiplinger-Domini national public opinion poll about ESG Investing It was connected From 4 August to 10 August 2021, with 1,029 respondents. The survey’s margin of error is +/- 3.52%. Respondents were screened for age (25 and over), annual income (at least $75,000) and non-retirement investments (minimum $10,000). A survey share on familiarity with the term ‘investing in ESG’ was carried out to ensure that about half of the respondents were familiar with the term prior to the survey. Responses to some questions may not reach 100 due to rounding or may exceed 100 if respondents can choose more than one answer.
About Personal Finance from Kiplinger
For a century, Kiplinger’s organization has been a leader in personal finance and business forecasting. Founded in 1920 by W.M. Kiplinger, the company developed one of the nation’s first successful newsletters in the modern era. kiplinger message, Launched in 1923, it is still the longest continuously published newsletter in United State. In 1947, Kiplinger created the country’s first personal financial magazine. Today, The Kiplinger Washington Editors, Inc. , a wholly owned subsidiary of Future PLC.
Located in the heart of our nation’s capital, Kiplinger Editors remain dedicated to providing sound and unbiased advice to your family and business in clear and concise language. Become a fan of Kiplinger Facebook social networking site or Kiplinger.com And follow Kiplinger’s Twitter And LinkedIn.
Domini Impact Investments is a SEC women-led registered investment advisor that empowers individual and institutional investors alike to make a difference, one investment at a time. By implementing social, environmental and governance standards across all of its investments, Domini harnesses the power of finance to create a better world. With an exclusive focus on impact investing aimed at creating positive social and environmental outcomes while striving for competitive financial returns, Domini ensures that every dollar is directed in a way that achieves its goals of global human dignity and environmental sustainability. The company’s focus on continuous innovation and community engagement creates strength in numbers, allowing Domini to fuel tomorrow’s prosperity and make “investment for good” the way all investment is made.
Learn more through Domini.com.
Read Domini’s Impact Report for the year 2020.
Before investing, consider each fund’s investment objectives, risks, fees, and expenses. Contact us for a prospectus with this and other information. Read it carefully.
The Domini Impact Equity Fund is subject to certain risks including impact investing, portfolio management, information, market and recent events, and medium to large corporate risk. The Domini Impact International Equity Fund is subject to certain risks including foreign investment, emerging markets, geographic concentration, country and currency, impact investing and portfolio management risks. The Domini Sustainable Solutions Fund is subject to certain risks including sustainable investing, portfolio management, information, market and recent events, medium and large corporations, and small business risks. The Domini International Opportunities Fund is subject to certain risks including foreign investment, geographic concentration, country, currency, portfolio management impact and information risk. International investing involves special risks, such as currency fluctuations, social and economic instability, various securities regulations and accounting standards, limited public information, possible changes in taxes, and periods of illiquidity. These risks may increase with respect to investments in emerging market countries. The Domini Impact Bond Fund is subject to certain risks including impact investing, portfolio management, style, information, market and recent events, interest rate and credit risk.
The advisor’s assessment of environmental and social factors in his investment choices and the timing of the sub-advisor’s implementation of his investment choices will affect the Fund’s exposure to certain issuers, industries, sectors, regions, and countries, and may affect the issuers’ relative financial performance. Financing depends on whether these investments are in favor or out of favor. The value of your investment may be reduced if the advisor or Subadviser’s judgment on the fund’s investments does not produce the desired results. There is a risk that the information that the advisor uses to assess environmental and social factors may not be readily available or complete, which could adversely affect the advisor’s ability to evaluate these factors and the performance of the fund. The market value of the fund’s investments will fluctuate and you may lose money. DSIL Investment Services LLC, Distributor, FINRA Member. 10/21
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Source: The Kiplinger Washington Editors Inc.