More than half of 2020 respondents were active in sustainable, impact or ESG investing
BOSTON, February 17, 2021 – Global investment firm Cambridge Associates (CA) has released the results of its biannual sustainable and impacting investing client survey. Since the inaugural survey in 2016, there has been a 146% increase in the number of institutional investors who report making sustainable and impact related investments. More than half (61%) of 2020 respondents were actively engaged in sustainable, impact or ESG investing, a 25 percentage-point uptick from the 36% reported just two years ago.
Now in its third installment, CA’s client survey explores the evolution of institutional practices around sustainable and impact investing. These insights and trends reflect the firm’s longstanding work with institutions to build portfolios that align with values and fundamental long-term economic value. According to the survey, institutions continue to employ a range of strategies including ESG integration, impact investing, negative screening, and program-related investments. ESG integration rose significantly over the last two years, as did impact investing, in a shift away from negative screening as a commonly employed approach.
“The rapid adoption of strategies that include environmental, social, and governance considerations reflects a growing consensus in line with our belief that these factors are material to long-term investment outcomes,” said Liqian Ma, Head of Sustainable and Impact Investing Research. “Cambridge Associates partners with our clients to build resilient portfolios that seek to integrate all material risks and opportunities in the investment process. At the same time, we customize and align each portfolio to each institution’s financial and impact objectives,” Ma continued. The survey demonstrates that CA clients are increasingly taking a more holistic approach to integrating sustainability and impact in the investment process.
While all regions have seen an increase in sustainable and impact investing engagement, the UK and Europe have led the industry. Nearly a third of non-US respondents engaged in impact investing have over 50% of long-term portfolios allocated to sustainable investments, while half of US respondents have less than 5% allocated.
“Many of our clients see the integration of sustainability as a source of competitive advantage. We are particularly proud to be working with some real thought leaders in endowments and foundations who are setting ambitious objectives like the achievement of net carbon zero.” said Annachiara Marcandalli, Head of Sustainable Investing for Europe. “We also see private wealth owners and family offices at the forefront of this trend, driven by a long-term time horizon that is a natural match to sustainable investments, personal values, and interests expressed by next-generation family members.”
The 202 respondents of the 2020 survey represent a globally diverse group of institutions; however, the majority of respondents classify as foundations, colleges and universities. The full report can be found here. To learn more about Cambridge Associates’ approach to sustainable and impact investing, visit our website or read more about The Materiality of Sustainability for Investors.
About Cambridge Associates
Cambridge Associates is a global investment firm. The firm aims to help pension plans, endowments & foundations, healthcare systems, and private clients implement and manage custom investment portfolios to generate outperformance so they can maximize their impact on the world. With more than 45 years of institutional investing insights, the firm has helped to shape and implement investment best practices and built strong global investment networks with the purpose of driving outperformance for clients. Cambridge Associates delivers a range of services, including outsourced CIO, non-discretionary portfolio management, staff extension and alternative asset class mandates.
Cambridge Associates maintains offices in Boston; Arlington, VA; Beijing; Dallas; London; Munich, Menlo Park, CA; New York; San Francisco; Singapore; and Sydney. Cambridge Associates consists of six global investment affiliates that are all under common ownership and control. For more information, please visit www.cambridgeassociates.com.