This article is a condensed interview conducted by Paul Ellis of Paul Ellis Consulting, who works with financial advisors seeking to integrate sustainable and impact investment strategies for their clients. He spoke with Lily Scott Trager, director of investing with impact at Morgan Stanley Wealth Management.
Ellis: How many advisors are there at Morgan Stanley?
Scott Trager: As of March 31, 2016, Morgan Stanley Wealth Management has over 15,800 financial advisors and three and a half million client households. This presents an incredible opportunity for investing with impact.
Ellis: How big is the sustainable investment group that you lead within Wealth Management?
Scott Trager: The Investing with Impact platform, which seeks to generate market-rate returns while demonstrating positive environmental and/or social impact, is not a group or business unit unto itself but rather a collaboration across the firm. The platform is integrated across the wealth management value chain and is part of a firm-wide effort to contribute to solving the anticipated extreme resource constraints around food, energy and water that a human population of 9 billion by 2050 will create.
In 2013, James Gorman, our chairman and CEO launched the Institute for Sustainable Investing, which is led by Audrey Choi, with the mission to maximize capital for a sustainable future. From this mission, a mandate was developed to leverage the multiple businesses within Morgan Stanley and innovate new ways of providing access to private capital in order to solve complex social and environmental issues.
Ellis: So the investor and their advisor can utilize the platform as part of their overall investment strategy?
Scott Trager: Yes, the Investing with Impact platform focuses on flexibility and engagement with our clients, allowing both targeted allocations as well as full integration of impact objectives into an investment portfolio. To support this, we continue to develop thought leadership, research and education, as well as diverse internal and third-party investment strategies.
Ellis: Please talk about the products available to Morgan Stanley advisors and clients through the Investing with Impact platform.
Scott Trager: We believe in making the best proprietary and third-party asset manager investment strategies available to our clients. These mutual funds, ETFs, separately managed accounts and alternative investment opportunities (for qualified investors) have the ability to generate market-rate financial returns as well as measurable positive environmental and social impacts. Through our Morgan Stanley proprietary framework, we have clarified the spectrum of approaches across which the investment strategies currently fit.