A white paper from investment manager Standard Life Investments on impact investing – once a niche corner of the market – reports that is entering the mainstream.
Impact investing involves investing in companies and funds that have the ability to generate positive social and environmental impact, alongside financial returns. According to recent Standard Life Investments research, delivered by The Wisdom Council, 80 per cent of UK respondents think human rights, equality and eradicating poverty are important considerations when investing and the same number do not expect to sacrifice performance when investing in values-based funds. The research highlighted that under 40’s are more likely to use values based investing, invest in funds that aim to make a positive difference and are familiar with the term impact investing.
The firm writes that there is an increasing recognition that publically traded corporations have the ability to generate significant environmental and social benefits. By channelling large amounts of mainstream capital into publically listed companies whose primary business models address pressing environmental, social and economic challenges, investors have the ability to achieve positive impact at scale.
Amanda Young, Head of Responsible Investment, Standard Life Investments, says: “The case for impact investing is strong. It represents a tangible way for socially and environmentally aware investors to deploy their capital in a manner that meets their environmental, social and financial goals. As we move forward we will no doubt see a wider range of investment vehicles, as well as more diverse impact targets. Measurement will also become increasingly sophisticated and standardised.
“Our research highlights that we expect demand for socially responsible, values-based investments to continue to grow, particularly among millennials. For asset managers and advisers that embrace impact investing and offer suitable products to cater for this market, the future looks bright.”
