Viewpoint: Sustainable investing risks becoming a victim of its own success
Monday, December 17, 2018
Sustainable investing is booming. The industry has spawned its own lingo—ESG, SASB, SRI, GRI—dedicated to describing this seemingly moral turn in the finance industry, where money is invested in ways that make the world a better place. After all, it feels good to generate a return while promoting the SDGs (that’s the UN’s sustainable development goals, if you’re wondering).
According to the latest report by the US Forum for Sustainable and Responsible Investment (US SIF), investors now consider environmental, social, and governance (ESG) factors for $12 trillion of professionally managed assets. That’s a 38% increase from 2016. It’s also out of a total universe of $46.6 trillion of professionally managed assets in the US. That means that almost a quarter of assets could now be considered “sustainably” or “responsibly” invested.