Sustainable, responsible and impact investing assets now total $12 trillion in the U.S., a 38% increase from 2016, according to the US SIF Foundation's 2018 biennial "Report on US Sustainable, Responsible and Impact Investing Trends," which was released Wednesday.
The report found $11.6 trillion assets under management that incorporate environmental, social and governance factors at the outset of 2018 held by 496 institutional investors, 365 money managers and 1,145 community investing financial institutions. In addition, 165 institutional investors and 54 investment managers collectively controlling nearly $1.8 trillion in assets filed or co-filed shareholder resolutions on ESG issues between 2016 and the first half of 2018, according to the report.
Eliminating double counting for assets involved in both ESG incorporation and filing shareholder resolutions produces the net total of $12 trillion in SRI strategies at the start of 2018, US SIF noted in a news release.
The top three ESG issues for asset managers and their institutional investor clients are climate change/carbon, tobacco and conflict risk, the report said.
For the 165 institutional investors and 54 investment managers mentioned in the report, proxy access was the leading issue they raised in shareholder proposals from 2016 through the first half of 2018, followed by disclosure and management of corporate political spending and lobbying.
According to the report, the proportion of shareholder proposals on social and environmental issues that receive high levels of support has been trending upward. "During the proxy seasons of 2012-2015, only three shareholder proposals on environmental and social issues that were opposed by management received majority support, while 18 such proposals received majority support in 2016 through 2018," the US SIF news release said.
"What the US SIF Trends Report shows incontrovertibly, is that investors are truly beginning to understand the value of ESG considerations as an effective means of managing risk and improving investment performance," said Amy M. O'Brien, global head of responsible investing at Nuveen, the investment management division of TIAA-CREF, in a statement. "With an intensified focus on important issues such as climate change and corporate board gender diversity, we hope to see creative solutions that will help address these challenges, and in turn, drive shareholder value in the years ahead."