Our new research highlights that individuals care about sustainable investing, with active engagement key to reflecting people’s values.

Active engagement is key to reflecting sustainable investing values, with nearly a third (29%) of individual US investors stating they would prefer their investment managers to actively engage with the management of unsustainable companies rather than invest only in sustainable companies. An even larger proportion – 43% – of younger investors (aged 18-39) favor such an approach.

These are key findings from our second sustainable investment research study – Sustainable Investment: Matching Strategies to Investors’ Goals, Volume II – created and conducted by behavioral finance experts Oxford Risk and fielded by Research Now.

Our initial research study from spring 2019 examined investors’ understanding of and interest in sustainable investment. The latest research study explores the initial findings further. It dives deeper to understand the degree to which investors want to have a social impact, and the degree to which they are willing to make trade-offs to achieve positive outcomes.

Millennials vs. Boomers

One of the main findings of our research is that interest in sustainable investing is already relatively high, with only 24% of respondents in the survey stating that they are not at least moderately interested in sustainable investing. However, the study demonstrates a significant divergence between millennials (defined as respondents aged 18-39) and older US investors (aged 50+). For example, 86% of adults 39 or younger are interested in sustainable investing, compared with 70% of those over the age of 50.

We have also found that lack of awareness of, and interest in, the social investment space affects retirement-planning considerations. When asked if they use a sustainable investing option in their retirement pension, 36% of respondents reported their plans did not have such an option, and 44% said they did not know if they had a sustainable option in their pension. Even in the ‘forced-choice’ environment of self-invested corporate or personal pensions, where investors have to do at least some browsing, only one-fifth (20%) were aware they had a sustainable-investing option. However, of those investors who recognized they had a sustainable-investing option, more than half of study participants (53%) chose to use it, with more than five times as many millennials as baby boomers in that group choosing the option.

Bridging the gap

E before S and G

When it comes to environmental, social and governance (ESG) factors, over a third of the individual US investors (39%) that we surveyed said they were most concerned about environmental issues compared with just 28% stating social issues and 23% selecting governance concerns. This interest runs counter to where much of the asset-management industry has historically been focused – on governance.

Creating and Sustaining Interest

Our research highlights that individuals care about sustainable investing, with younger investors in particular increasingly wanting to reflect their values, interests and concerns in their investment decisions. However, for sustainable investment to grow, it needs an increase in general awareness, and a clear path from there to a suitable solution that answers the questions a given investor is asking. While potential sustainable investors divide into statistical groups, active sustainable investors are individuals. For each one, having a range of available options is less important than having a single option which addresses their goals.

Our paper explains how behavioral and attitudinal profiling can be a bridge between the two: an insight into both the general attitudes to sustainable investing that guide product creation and the specific messages that resonate best with each buyer. We believe this is the key to personalizing both a portfolio and the narrative that reassures the owner they have made the right call.


Julian Lyne

Julian Lyne

Chief commercial officer

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