Impact appeal dips this year but remains high among millennials

An ACI study has found the appeal of impact investing has stagnated this year but has grown in the US since 2016

The appeal of impact investing has dropped slightly among all age groups in the UK since last year, a study by American Century Investments has found.

Now in its fourth year, The Growing Appeal of Impact Investing Contrasting US, UK and Germany Attitudes report found interest in impact investing among millennials, baby boomers and gen x, as well as among men and women, dipped in every category in the UK this year.

It also dipped among millennials in the US, and remained the same across the other age groups and genders. However, in the US, since the global asset manager’s first study in 2016, net interest among all age groups has increased, from 38% to 51%.

“While the results show a slight dip in the appeal for impact investing in this year’s study from last year’s, it’s important to highlight that this appeal remains strong among the millennial generation in the UK and Germany,” said Guillaume Mascotto, vice president, head of ESG and investment stewardship at American Century.

“This trend is aligned with our view that, as the composition of the investor base continues to shift toward the millennials, we expect demand for impact-focused investment solutions to accelerate, especially in Europe.”

In the US, impact on society is consistently the least important factor in decision-making, at 57% this year compared with return on investment and risk both at 78%, fees at 77% and length of time money will be invested at 74%. It is also the lowest factor in the UK and Germany this year. Again, however, since 2016, the percentage of those that consider impact on society important has risen from 42%.

Last year, social media was the most common source for learning about ESG and impact investing in the US, at 32%. This year, it is still the most likely place for respondents to find information, at 30%, but is on par with family and friends.

The survey was conducted among a representative sample of 1,002 US adults, 1,004 UK adults and 1,004 adults in Germany, 18 years of age and older from September 9-11 and September 10-15, 2020, respectively.

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Natasha Turner

Natasha is global deputy editor at ESG Clarity, part of the Bonhill Group, and has been a financial journalist for six years. She has been shortlisted for Story of the Year and Investment Journalist of...