Sustainable investing assets in the U.S. grew 42% in the last two years, reaching $17.1trillion at the start of 2020, according to the US SIF Foundation's biennial report out Monday. The amount represents a third of the $51.4 trillion professionally managed assets in the U.S., according to US SIF.
Some $2 trillion of the $17.1 trillion in assets were involved in filing or co-filing shareholder resolutions on ESG issues at publicly traded companies from 2018 to 2020.
The Report on U.S. Sustainable and Impact Investing Trends covers U.S. asset management firms and institutional asset owners using sustainable investment strategies, and looks at the ESG factors used to manage portfolios.
For money managers, client demand was the top motivation, while most institutional investors said they were motivated by mission and social benefit.
Climate change was still the most important ESG issue for asset managers, with $4.2 trillion in assets considering it, a 39% increase from the 2018 report.
The fastest-growing ESG category over the last two years was environmental, up 57% over the same time period. Among specific issues, executive pay had the greatest growth, up 122% since 2018.
The report includes 530 institutional asset owners with $6.2 trillion in ESG assets, representing roughly half of the $12 trillion money managers identified as institutional assets. Public funds represented the largest share, with 53%, or $3.4 trillion, followed by insurance companies at 38%, and single-digit percentages for educational investors, foundations and others.
Among those institutional investors, climate change and carbon emissions were the top environmental concern, affecting $2.6 trillion in ESG assets. Other topics gaining importance were sustainable natural resources and agriculture, labor and social issues, and corporate governance criteria such as board issues, anti-corruption and executive pay.