Americans believe investments play a role in addressing world issues, Schroders study finds
NEW YORK, NY – September 30, 2021 – Global asset manager Schroders has today released the findings of its annual Global Investor Study, which found that U.S. investors, particularly millennials (age 22-41), are concerned with how the companies they invest in behave. Furthermore, they believe that investors have a role to play in solving the world’s problems through their investment decisions.
Schroders’ Global Investor Study surveyed over 23,000 investors (including 1,500 in the U.S.) gauging their sentiment on key investment themes and outlooks, with a particular focus on their views on sustainability, climate change and ESG investing.
Investors look to managers to help them address world issues
More so than their global counterparts, this year’s U.S. survey respondents believe investors and managers can play a part in solving the world’s problems, specifically after the pandemic, which increased some investors’ concern with environmental and social issues. Three in five (60%) said that investment managers and major shareholders should be responsible for mitigating climate change, compared with 53% of investors globally. This number climbs even higher among U.S. millennials (70%).
A similar percentage (63%) thought that investment managers and major shareholders should be responsible for mitigating social inequality (compared with 55% globally), while 67% thought they should be responsible for lessening poor corporate governance (compared to 61% globally).
“In the political sphere, in the media and within the financial services industry, the role ESG should play in portfolios is being hotly debated,” said Sarah Bratton Hughes, Head of Sustainability, North America, at Schroders. “However, managers and major shareholders need to recognize how changing consumer preferences will shape investment decisions and company performance and be able to provide tangible evidence that their allocations are truly making an impact.”
Holding bad actors accountable
Along these lines, Americans were more likely than investors globally to want to withdraw funds from companies involved in scandal. For example, a majority said they would withdraw funds from a company if they had a scandal related to the following areas, with U.S millennials trending a few percentage points higher in each category:
Scandal Category | Global Investors | U.S. Investors | U.S. Millennial Investors |
Financial or accounting | 65% | 69% | 71% |
Climate Change Catastrophe | 60% | 65% | 71% |
Human Rights | 59% | 65% | 70% |
Treatment of Workforce | 56% | 65% | 69% |
Data Privacy/Cyber Hack | 61% | 64% | 69% |
Internal culture | 49% | 58% | 65% |
To note, U.S. investors were particularly concerned with treatment of a company’s workforce, with 65% of respondents saying they would withdraw funds from a company experiencing this type of scandal, compared to 56% of global investors. This issue is particularly timely, given discussions around ongoing labor shortages in the country, and debates over raising the minimum wage and other employee benefits. This heightens the reason for investors to consider a “Quality Jobs” framework when analyzing companies.
US investors optimistic about and invested in the future of sustainable investing
U.S. investors are keen to incorporate sustainable investing into their portfolio, with one in three hoping their financial advisor will present more information regarding sustainable funds. Even more compelling, 68% expressed that they would react positively if their financial advisor were to move all their investments into sustainable funds, if the levels of risk, diversification and fees remained the same.
“ESG is no longer a niche investment strategy and has firmly cemented its place in mainstream investing,” said Bratton Hughes. “Individual investors are recognizing that sustainable investing will not only allow them to fund positive change in the world, but could also help them enhance risk-adjusted returns by avoiding pre-financial risks associated with climate change, human capital management, poor governance, and other factors.”
View the full results here: Sustainability hub
For further information, please contact:
Sarah Levine
Prosek Partners
646.818.9289
slevine@prosek.com
Note to Editors
For trade press only. To view the latest press releases from Schroders visit: http://ir.schroders.com/media
*About Schroders Global Investor Study
Schroders commissioned Raconteur and Iresearch to conduct an independent online survey of 23,450 people (20,687 Non-retired & 2,763 Retired) in 32 countries around the world, between 16th March – 07th May 2021.
This research defines ‘people’ as those who will invest at least €10,000 (~$13,622 USD) in the next 12 months and who have made changes to their investments within the last 10 years. These individuals represent the views of investors in each country included in the survey.
Schroders plc
As a global active asset manager, the way we direct capital not only shapes the financial returns we achieve for our clients but also the impact that the companies in which we invest on their behalf might have on society. The relationship between these two outcomes has rapidly evolved as we see a fundamental shift in how companies are viewed and valued. Understanding the impact that they can have on society and the planet is crucial in assessing their ability to deliver risk-adjusted profits.
Our ongoing success is built on a history of experience and expertise, whereby we partner with our clients to construct innovative products and solutions across our five business areas consisting of Private Assets & Alternatives, Solutions, Mutual Funds, Institutional and Wealth Management and invest in a wide range of assets and geographies. By combining our commitment to active management and focus on sustainability, our strategic capabilities are designed to deliver positive outcomes for our clients.
We are responsible for $967.5 billion* assets of our clients, managed locally by 42 investment teams worldwide. As a global business with over 5,500 talented staff across 37 locations, we are able to stay close to our clients and understand their needs. We have over 200 years of experience in investment and innovation and remain committed to creating a better future by investing responsibly for our clients.
Further information about Schroders can be found at www.schroders.com/us.
*as of June 30, 2021
Important Information:
All investments involve risk, including the loss of principal. Diversification cannot ensure profits or abate all risk. The views and opinions stated are those of the individuals quoted and are subject to change. This document does not purport to provide investment advice and the information contained is for informational purposes and not to engage in any trading activities. The material is not intended to provide, and should not be relied on for accounting, legal or tax advice, or investment recommendations. Schroder Investment Management North America Inc. (“SIMNA”) is an SEC registered investment adviser providing asset management products and services to clients in the US and Canada. Schroder Fund Advisors LLC (“SFA”) is a wholly-owned subsidiary of SIMNA Inc. and is registered as a limited purpose broker-dealer with FINRA and markets certain investment vehicles for which SIMNA Inc. is an investment adviser. SIMNA Inc. and SFA are indirect wholly-owned subsidiaries of Schroders plc, a UK public company with shares listed on the London Stock Exchange. Further information about Schroders can be found at www.schroders.com/us or by calling (212) 641-3800.
The views and opinions contained herein are those of Schroders' investment teams and/or Economics Group, and do not necessarily represent Schroder Investment Management North America Inc.'s house views. These views are subject to change. This information is intended to be for information purposes only and it is not intended as promotional material in any respect.