A new paper by World Resources Institute finds strong interest and opportunities for sustainable investing within the US institutional investor marketplace. But key barriers persist.
A survey of over 100 investment professionals shows that institutional investors – including pensions, foundations, universities, and NGOs – are increasingly considering the material importance of social, environmental, and governance factors in constructing their portfolios. While a desire to align investment with mission or stakeholder pressure drove most early movers to sustainable investing, economic drivers are making sustainability an issue that long-term investors simply cannot ignore. As their interest grows, investors are finding more support in pursuing sustainable investing. Despite the enthusiasm and more capital flowing, WRI found key gaps in the market that prevent even the most motivated asset owners from deploying capital sustainability. For those starting on their journeys to sustainable investing, this paper provides insights into common questions and challenges investors will need to grapple with. It also provides initial steps investors and their partners can take to overcome barriers and advance in the market.