January 2017 – Socially Responsible Investing

Socially responsible investing has continued to grow in recent years both in popularity, particularly among Millennials, and in the volume of assets it attracts. For what began as a niche investment strategy, socially responsible investing (SRI) now accounts for one in five dollars under professional management in the United States (according to The Forum for Sustainable and Responsible Investment). As more and more investors look to support social causes through their portfolios, brokerages must stay apace to provide them with the offerings they desire. In this month’s Broker Monitor Report, we examine our coverage group firms’ online resources covering SRI, examining educational, research and marketing materials made available to retail investors. This topic was last covered in November 2014.

Since we last covered this topic in 2014, the number of assets under management in sustainable investing has grown by more than 33%, increasing from $6.57 trillion in 2014 to $8.72 trillion in 2016. The number of available socially responsible investments has expanded dramatically as well. Yet, despite this growth, socially responsible investing is still not a topic that is universally covered throughout our coverage group; six firms do not offer any educational articles or commentaries on their online platforms. For the firms that do cover it, we continue to see a large range in the depth of information offered. More firms now offer a “socially conscious” filter in their mutual fund or ETF screeners to help clients locate investments. However, firms in our coverage group—compared to new startups around the industry—still have a long way to go in helping clients more effectively find the socially responsible investments that align with their values. As SRI continues to grow as an area of interest among investors, traditional brokerages must continue to expand their SRI-related resources on their web platforms.