SRI Growing Faster Than Rest of Investment World
27 March 2008 at 11:25 am
Socially responsible investing (SRI) in the United States is now growing at a much faster pace than all investment assets under professional management, according to the new edition of the Report on Socially Responsible Investing Trends in the United States published by the nonprofit Social Investment Forum (SIF).
The report found that, from 2005 to 2007, SRI assets increased more than 18 percent while all investment assets under management edged up by less than 3 percent.
The Trends report identifies $US2.71 trillion in total assets under management using one or more of the three core SRI strategies — screening, shareholder advocacy, and community investing.
In the past two years, social investing has enjoyed healthy growth from the $US2.29 trillion documented in the 2005 Trends report.
The report says today nearly one out of every nine dollars under professional management in the United States is involved in socially responsible investing – 11 percent of the $US25.1 trillion in total assets under management tracked in Nelson Information’s Directory of Investment Managers.
Social Investment Forum Board Chair Cheryl Smith says thanks to growing institutional investor demand and a wide range of issues that are driving stronger retail investor interest, socially responsible investing is thriving today as never before.
Increasingly, she says money managers are incorporating social and environmental factors into their investing practices, acknowledging the demand for social investing products and services from institutional and individual investors, socially concerned high-net-worth clients, individuals seeking SRI options in their retirement and college-savings plans, and ‘mission-driven’ institutions including foundations, endowments, labor unions, and faith-based investors.
Social Investment Forum Board Chair Alisa Gravitz says new investment products and fund styles are driving growth in socially and environmentally screened funds, especially ETFs and alternative investment funds such as social venture capital, double- and triple-bottom-line private equity, and hedge funds.
She says examples of how issues are driving SRI investments include the fast-growing numbers of institutional investors, fund families, and money managers that are incorporating criteria related to climate change and the crisis in the Sudan into portfolio management and shareholder advocacy.
For the full text of the executive summary of the 2007 Trends report, go to www.socialinvest.org/resources/research.