According to a recent survey conducted by Morgan Stanley's Institute for Sustainable Investing, a significant number of individual investors remain strongly interested in sustainable investing practices. The survey, titled “Sustainable Signals,” queried 1,765 active individual investors possessing over $100,000 in investable assets from regions including North America, Europe, and Asia Pacific between February and March of this year. It aimed to evaluate current attitudes towards sustainable investing and identify perceived opportunities and challenges in this sphere.
A notable majority of global investors surveyed, totaling 88%, expressed interest in sustainable investing. Younger generations, specifically Generation Z and Millennials, demonstrated the highest levels of interest, with 99% and 97% respectively showing enthusiasm. Furthermore, nearly 64% of all surveyed investors reported that their interest in sustainable investments had increased over the past year.
Echoing these findings, Jessica Alsford, Chief Sustainability Officer and Chair of the Institute for Sustainable Investing at Morgan Stanley, stated, “Our Sustainable Signals survey shows that investors across demographic groups and regions continue to believe that investments can achieve both positive real-world outcomes and competitive market-rate returns. Younger investors plan to increase portfolio allocations to sustainable options at higher rates and prioritize a broader range of environmental and social issues when making investment decisions. This suggests that sustainability could become an even greater focus area for investors in the future as younger generations gain more financial influence.”
Additional insights from the survey highlighted that over half of the investors (59%) planned to increase their allocation of sustainable investments within the year. Confidence in these options' performance, comparable to traditional investments, emerged as the leading driver for this increase, cited by 24% of the investors. Meanwhile, 31% intended to maintain their current levels due to benefits in portfolio diversification.
Investors globally recognized renewable energy and energy efficiency as top investment priorities, with more than 80% viewing the transition to clean energy as an opportunity for returns. However, regional prioritizations varied with North American investors emphasizing healthcare affordability and innovation, whereas counterparts in Europe and APAC focused on energy storage, battery technology, and sustainable land use.
The survey indicated a strong inclination towards financial advisors with sustainable investing offerings, as nearly 80% of global investors indicated preference. The trend was particularly strong among Gen Z (96%) and Millennials (92%).
Initiated in 2015, the Sustainable Signals series continues to capture the investment affinities of various demographics, institutional investors, and corporations.
For more information about Morgan Stanley and its sustainable practices, visit their official website.