January 2018 – Socially Responsible Investing: A Review of SRI, ESG and Impact Investing Resources and Products

Over the past several years, socially responsible investing (SRI) strategies have become more popular. According to the Forum of Sustainable and Responsible Investment, ESG-focused strategies represented $8.7 trillion of the $40.3 trillion in professionally managed U.S. assets in 2016. According to BlackRock, skillfully managed SRI products can have the same return potential as traditional funds and demand for these products only continues to grow across retail and institutional investor markets. This month’s Asset Management Monitor – Advisor Report profiles coverage group firms that sell products with SRI scope. We also examine and review content these firms offer surrounding the category.

Because SRI strategies are a relatively recent development, firms should make sure to offer content on the topic to educate advisors and provide material to drive client discussions. Of the firms in the coverage group with SRI vehicles, nine provide resources to help advisors learn and promote these products to clients. Of note, select firms call out Millennials and women in their content as being prime prospects for SRI funds, given their demographics’ interest in investments that are aware of their social and environmental impact. In their materials, however, firms do not adhere to a standardized terminology, with companies across the coverage group using varied terms to refer to the same general concepts. In terms of actual product offerings, our review finds that select firms are entering the category through acquisitions and sub-advisory partnerships, signaling the potential for a future trend.

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