Investment Vision 2011 Series: Socially Responsible Investing

Insight Group PLC - Research Room: Socially Responsible Investing

There are green and ethical funds with excellent recent and long term performance, which demonstrates the potential for investment growth in the sector.

-Penny Shepherd, Chief executive of UK Social Investment Finance

After some prospective years for Socially Responsible Investing (SRI), it has advanced significantly to become a mainstream in finance. Its methods have also developed, along with the whole movement toward a more socially discreet practice of investing money. SRI have grown by 13% since 2007, compared to less than 1% by mainstream assets (2010 Trends Report by the Social Investment Forum (SIF)). It is no longer seen as an area just for the ethical minded, and in the U.S. alone SRI topped $3 trillion, nearly one out of every eight dollars under professional management (SIF, 2010).

The 2010 SIF report found that institutional investors continue to dominate the sustainable investment landscape, with $2.3 trillion in assets under management. The overall SRI landscape, which includes banking, credit unions as well as investments, has almost tripled from £5.1 billion in 1999 to £14.4 billion in 2010 (The Co-operative Financial Services, 2010). A staggering 380% growth was reported in 2010 by professionally managed assets that followed sustainable investment strategies. SRI assets have increased more than 34% while the broader universe of professionally managed assets have increased only 3% (2010 Trends Report by SIF).

In this report

  • Executive summary
  • Socially Responsible Investing
  • Different Approaches to SRI
  • Environmental and Socially Conscious Investing
  • Renewables, a Good Investment
  • Biomass, Biofuels and Biodiesel
  • Global Involvement in Ethical Investments
  • Socially Responsible Investment Performance and Future
  • Potential, Benefits and Risk of Ethical Investing

Key data

  • SIR has $2.3 trillion in assets under management
  • Renewable energy investment was $162 billion in 2010
  • Channelling $1.3 trillion, of global GDP into greening sectors
  • The largest global industry is energy production and supply
  • China aims for 15% of final energy consumption in targeted amounts
  • In the U.S. for every $9 invested, $1 is specifically put into the SRI area

independently written by our Market Intelligence & Research Unit (MIRU) to find out more about this flourishing region.

Insight Group PLC - Research Room: Socially Responsible Investing