INVESTING/PORTFOLIO STRATEGIES

Almost 30% of DC plans could offer SRI option

As many as 29% of defined contribution plans could offer socially responsible investment options in the next two to three years, based on the results of a survey of DC plans by Mercer and the U.S. SIF Foundation.

Of the 421 plan executives who responded to the survey, 14% offer at least one SRI option and 15% of those that don't are considering or planning to add one to their investment lineup in the next two to three years.

Eighty-four percent of respondents said the demand for SRI options will increase or remain steady over the next five years.

Meg Voorhes, deputy director and research director of U.S. SIF Foundation, said in a telephone interview that of the 14% offering SRI as an investment option, 23% offer more than one. She said the increase is driven primarily by participants asking for the options.

“I sense that the respondents are seeing this as something of a bottom-up campaign with requests coming from participants,” she said.

Craig Metrick, Mercer principal and U.S. head of responsible investing, said in a telephone interview that increased education about SRI to plan executives and participants could provide the impetus for adding an SRI option.

Fifty-eight percent of survey respondents had minimal or no understanding of SRI investment products and indexes.

The survey was conducted in March and April.