Callan, an institutional investment consulting firm based in San Francisco and with offices in Atlanta, Chicago, Denver and New Jersey, in December released a report from a survey of 84 unique institutional funds that nearly 37% of those funds now “incorporate ESG factors into investing decision,” up from 22% 3 years ago.
Among its findings:
- In 2016, 37 percent of all survey respondents have “incorporated ESG factors into decision making,” up from 22 percent in 2013.
- High adoption among endowments (53 percent) and foundations (48 percent) relative to other fund types.
- A material uptick in corporate funds’ incorporation relative to a year ago, doubling from 15 percent in 2015 to 30 percent in 2016.
- Highest rates of adoption (71 percent) among the largest funds (>$20 billion in assets).
Factors why survey participants have NOT incorporated ESG factors into investment decisions. “Unclear Value Proposition” topped the answers.
Additionally, “lack of clarity over the ESG value proposition” remains a high barrier to funds incorporating EST into investing decisions, survey author Anna West, SVP and chair of the Callan’s EST committee.
“This points to a potential opportunity within the EST investment community for ongoing education and dialogue on this issue.”
Source: Callan Survey Report
