To put it in Beyoncé terms, girls still run the world of impact investment. But the boys are catching on, according to a new survey of high-net-worth investors
Over the last two years, the number of wealthy Americans who would like to invest for social or environmental impact, or have already done so, has increased across the board, regardless of age, gender or amount of assets, according to the 2017 U.S. Trust Insights on Wealth and Worth survey, released Tuesday. Overall, 45 percent of the survey’s respondents now say they’re either interested in or already allocating assets to impact investing, up from 32 percent in 2015.
That said, with the activities of women and millennials the only exception, the growth is largely in interest rather than action, leaving a fairly large gap between the two (of the 45 percent above, only 13 percent had taken the leap and invested for impact, while 32 percent said they’d like to.) This means advisors have an important role to play helping their clients figure out just how to enter the impact investing market.
“That aspirational gap is an opportunity for advisors to step in and say, ‘let’s have a conversation about how your investment portfolio can have an impact in a way that’s aligned with your values’,” says Jackie VanderBrug, managing director at U.S. Trust and heads of the firm’s impact investing platform.
Gender and age differences remain, of course. While interest in investing for impact grew across demographics, the usual suspects, so to speak, were the ones who made significant strides in adding actual impact investors to their ranks. “Women and millennials are moving from leading in interest to leading in action,” VanderBrug says. The number of wealthy millennials who’ve allocated assets to mission-based investing jumped to 28 percent, from 17 percent in 2015; the number of women who own impact assets doubled—to 18 percent from 9 percent two years ago.
When it comes to interest, though, men are closing the gap, with the number who said they’d like to invest for impact doubling, to 31 percent (compared to 34 percent for women). In 2015, 16 percent of men said they were interested.
Millennials remain far ahead of their parents and grandparents—80 percent of millennials have invested for impact or want to—but members of Generation X are making notable strides. Thirty-seven percent of Gen Xers are now interested in impact investing, up from 23 percent in 2015, and another 17 percent of them have invested, up from 11 percent two years ago. Interest increased among baby boomers and the “Silent Generation” (folks 73 and over) as well.
U.S. Trust surveyed more than 800 high-net-worth households with $3 million or more in investable assets.