Investors aren’t sold on ‘values-based’ investing, but they may be missing out

Tuesday, November 29, 2016

Investing with your conscience may not your thing, but it’s working for people who know where to look. So-called “values-based” investing — putting money into companies with strong track records on the environment, social issues and corporate governance — has increased among major money managers. Scandals at Wells Fargo and Volkswagen show that misdeeds can crop up even at well-known firms, and can hit their stocks as well.

But still about a third of investors don’t view socially conscious investing as a source of better returns than investing in the broader market, according to an RBC Global Asset Management survey released last week. Forty percent of respondents did not consider it a way to prevent losses, the report said.

Exploiting a ‘perception gap’

Since investors “remain unconvinced” about socially-conscious investing’s benefits for improving returns or preventing losses, that creates “a perception gap” for investors to exploit, a press release on the RBC study said. Ninety major market players completed the online survey, said RBC, which distributed the questionnaire to 1,000 institutional asset owners, wealth managers and pension plan consultants.

Source: CNBC (link opens in a new window)

Impact Assessment, Investing