March 2, 2019

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Morgan Stanley Research Important Takeaway: Sustainable Investing Approaches Now Clearly Mainstream For Institutional and Retail Asset Owners

A 2018 survey by Morgan Stanley took the pulse of U.S. asset managers (with in-depth telephone interviews) to determine the level of adoption of sustainable investing approaches by asset managers in the United States. 

Results:  in the report “Sustainable Signals: Growth and Opportunity in Asset Management” a majority of managers said they now see sustainable investing strategies as a strategic imperative, explains Matthew Slovik, head of Global Sustainable Finance at Morgan Stanley.

Morgan Stanley Institute for Sustainable Investing and Bloomberg had 300 asset management firms with at least US$50 million in Assets Under Management polled and the results built on a prior Morgan Stanley and Bloomberg survey in 2016 (“Sustainable Signals: The Asset Manager Perspective”). In that year’s pulse-taking, 65% of survey respondents said their firms adopted sustainable investing; the 2018 response was that 75% of asset management firms surveyed had done so.

Reasons cited:  increased investment stability; high client satisfaction; product popularity; possible high finance returns.

Explains Bloomberg Global Head of Sustainable Business & Finance, Curtis Ravenel:  “As investors increasingly consider sustainability factors across asset classes and investment products, we expect to see a shift toward better data tracking and reporting mechanisms…this will increase credibility and improve measurements of impact across portfolios.”

Survey Highlights:  Three-in-four U.S. asset managers now offer sustainable investing strategies. Nine-in-ten say sustainable investing is not a fad, it’s here to stay. Eight-in-ten say strong ESG practices can lead to higher profitability and companies [with ESG practices] may be better long-term investments. Two-out-of-three asset managers believe that it is possible to maximize financial return while investing sustainability.

Consider that according to the most recent survey of U.S. asset owners and managers by the U.S. Forum for Sustainable & Responsible Investing (US SIF), $13 trillion (or one-in-four dollars) of professionally-managed assets now consider sustainability principles, a clear signal that ESG factors are now widely incorporated into investment processes.

The new Morgan Stanley / Bloomberg survey results make the financial case for sustainable investing with both institutional and retail investors demanding an increasingly sophisticated range of investment approaches and impact outcomes.

The Initiative for Responsible Investment at the Hauser Institute for Civil Society at the Harvard Kennedy School and Edelman Intelligence contributed to the work.

The Top Story this week has highlights of the survey; click here to access the 16-page report.

The US SIF’s comprehensive “Report on U.S. Sustainable, Responsible and Impact Investing Trends 2018” is also available.

This Week's Top Story

Sustainable Investing Goes Mainstream: Morgan Stanley and Bloomberg Survey Finds Sustainable Investing a Business Imperative Among U.S. Asset Managers
(Friday - February 22, 2019) Source: BusinessWire - A majority of U.S. asset managers are now practicing sustainable investing, viewing it as a strategic business imperative. In a new survey entitled Sustainable Signals: Growth and Opportunity in Asset Management, from... 

Sustainability: Continuing Forward Momentum!

What Do Investors Want To Know About Your Sustainability Strategy? Now Companies Have A Guide
(Tuesday - February 19, 2019) Source: Forbes - Sustainability issues have risen up the business agenda and they can no longer be ignored – consumers and investors alike are demanding more responsibility from the companies they buy from and whose shares they own. 

The Role Sustainability Plays in Creating Campaigns and Marketing
(Tuesday - February 19, 2019) Source: Ad Week - The world is moving toward a more sustainable future. At this point in human history, there’s simply no alternative. Either we do this and do it fast enough to confront the crisis, or we face some pretty dire consequences.

Subscriptions: The Next Frontier In Environmental Sustainability
(Wednesday - February 20, 2019) Source: Forbes - Subscriptions are booming across both B2B and B2C applications. Companies across all industries are scrambling to reimagine their traditional, transaction-based customer relationships into recurring revenue relationships. It’s... 

Building a sustainable manufacturing enterprise
(Wednesday - February 20, 2019) Source: The Fabricator - Sustainable manufacturing is a business objective to support production efficiency and economic viability. The components of sustainability include economic stewardship, environmental responsibility, and being a good neighbor...

Society and customers expect more, and a sustainable business model delivers  
(Thursday - February 21, 2019) Source: Greenbiz - Sustainability is on the radar screen of every major organization. Some organizations, such as Interface, Patagonia and Unilever, have made fundamental shifts to redesign their operations behind sustainable principles.

Life After Brexit: Sustainability And The European Regional Development Fund
(Friday - February 22, 2019) Source: Forbes - Infrastructure and sustainable development projects in the United Kingdom benefiting from the European Regional Development Fund (ERDF) have been left with a sense of uncertainty as the Brexit date looms. 

Sustainable packaging remains hot during 2019’s winter  
(Friday - February 22, 2019) Source: Packaging Digest - What happens when you combine sustainable packaging with ecommerce challenges? You get an idea of what packaging professionals were especially concerned about the first month of the new year. 

How Can New Technologies Help Make Fashion More Sustainable?
(Friday - February 22, 2019) Source: Business of Fashion - Fashion’s environmental footprint is one of the largest of any industry in the world, although it’s nearly impossible to measure the true scope of its impact. (The oft-quoted stat that it's the... 

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ESG Topics & Issues Headlines

As More Electric Cars Arrive, What's The Future For Gas-Powered Engines?
(Tuesday - February 19, 2019) Source: NPR

Amazon wants to reduce shipping's harm to environment
(Wednesday - February 20, 2019) Source: CNET 

Vast Majority of Employees Say There’s an Urgent Need for Moral Leadership in Business Today – But It’s All Too Rare, New Report Says
(Wednesday - February 20, 2019) Source: Globe Newswire 


Headlines From the Corporate Sector

Campbell Soup Builds Resiliency Through Sustainable Farming
(Tuesday - February 19, 2019) Source: Forbes - Campbell Soup believes that the sustainability concept should equate to building resiliency and efficiency in the agriculture supply chain, and sustainable farming practices will eventually help its business reduce costs.

“Issue With Tissue” Sustainability Scorecard Flunks Charmin and Other Toilet Paper Brands
(Thursday - February 21, 2019) Source: NRDC - A new report takes the largest tissue companies to task for destroying North American forests and exacerbating the world’s climate crisis. “The Issue with Tissue” reveals Procter & Gamble, Kimberly-Clark, and... 

Sarah Ahmed Is The Founder Of Our Favorite Sustainable & Size-Inclusive Denim Brand
(Wednesday - February 20, 2019) Source: Coveture - Founder Sarah Ahmed combined this innovative fabric with the sustainable practices she picked up from her family’s luxury denim brand, DL1961, and now Warp + Weft is being snatched up by women and men across the globe... 

Johnson & Johnson receives federal subpoenas related to baby powder litigation
(Thursday - February 21, 2019) Source: Reuters

UBS fined €3.7bn in tax fraud case
(Thursday - February 21, 2019) Source: BBC 

Disney, Nestle pull YouTube ads in uproar over child videos  
(Thursday - February 21, 2019) Source: Engadget 

Amazon HQ2: Cities are trying to woo tech giant after cancellation of New York plans
(Thursday - February 21, 2019) Source: USA Today 

Even With HQ2 Dead, New York Isn't Done Fighting Amazon 
(Friday - February 22, 2019) Source: Gixmodo 

Ford hires outside firm to investigate US fuel economy and emissions compliance after employees raise concern
(Friday - February 22, 2019) Source: CNBC 

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Governance & Accountability Institute's blog focusing on the sustainable world evolving daily before our eyes. Read it, absorb it, question it and challenge.

Millennials Really Do Want To Work for Environmentally-Sustainable Companies, According to a New Survey of Large Company Employees

Question for Corporate Leaders: Is Your Company’s Sustainability Journey Based on Key Strategies? Is There Clear Alignment of Foundational Strategies with Sustainability?

The Ethical and Sustainable Supply Chain – Some Thoughts on This For You From Forbes

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The Fourth Official “Climate Science Special Report” Issued by the US Government’s “Global Change Research Program” – Projecting Critical Impacts of Climate Change on American Society in 21st Century

Are They Good Corporate Citizens? Microsoft and Other Firms Address the Needs of Their Employee New Parents – And One Positive Signal is Sent

 

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