NextBillion - An Initiative of the William Davidson Institute at the University of Michigan

Thursday, March 10, 2016

Bill and Melinda Gates have long worked to reduce disease and poverty. For Mark Zuckerberg and Priscilla Chan, education ranks as a top cause. And Michael Bloomberg is battling climate change and gun fatalities. Of course, plenty of room for overlap exists, but you get the point: Not all philanthropists care about the same things.

The same goes for impact investors. While some form of sustainable, responsible and impact (SRI) investment appeals to many people—of roughly 1,000 high-net-worth investors polled last year by Morgan Stanley Wealth Management, 71 percent expressed interest in SRI—taking action can be challenging due to the plethora of options available, many of which have broad objectives.

It’s an issue that has not escaped notice within the asset management industry, where a trend of theme-based customization is developing. Morgan Stanley Wealth Management and J.P. Morgan have launched platforms aimed at making the impact investment process simpler and more efficient for investors and their advisors, and themed investment is a big part of the strategy.

“Investing with impact as a monolithic concept can be somewhat unapproachable by nature, so we wanted to break down this concept into really relevant themes that high-net-worth individuals could relate to,” says Lily Scott Trager, director of investing with impact for Morgan Stanley Wealth Management in New York.