In 2019, flows into U.S. sustainable funds more than quadrupled the previous annual record for net flows.1 In the first four months of 2020, investors poured a record of at least $12.2 billion into environmental, social, and governance (ESG) funds.2 Further, more than 70 percent of ESG funds across all asset classes performed better than their counterparts during the first four months of the year.2 It’s likely your clients may be interested in aligning their portfolios with their values.
If you’re looking for more information to help get the conversation started, address potential client concerns, and explain the value of ESG funds, we have a slate of recently published resources authored by Kiley Miller, Associate Portfolio Manager, and Tim Clift, Chief Investment Strategist:
- Market Volatility, ESG, and Deeper Client Engagement, Envestnet blog
- Cut Through the Noise: Evaluating ESG Strategies, Envestnet blog
- ESG Fund Ratings: Not Perfect, but Still Valuable, ThinkAdvisor
- Talking to Clients About Impact Investing Doesn’t Have to Be Awkward, ThinkAdvisor
- Sustainable Investing Doesn’t Mean Sacrificing Returns, ThinkAdvisor
- Current Events May Pull Impact Investing Into The Mainstream, Envestnet blog
- Investing Through a Lens of Social Justice, Envestnet blog
Given that ESG funds can offer your clients downside protection, more resilient portfolios, and a way to connect with the issues they care about most, more investors may inquire about the strategy or expect you to offer it as an option. At a time when investors are apprehensive about market volatility and seeking a trusted partner, impact investing can enable you to connect more deeply as you learn more about your clients’ values and concerns, while also demonstrating your ability to identify creative solutions that align with their unique lifestyles and can offer the returns they desire.
Learn more about how Envestnet can help you Invest with Impact, with solutions that support both positive social impact and financial goals.
Sources:
1. Kristin Broughton and Maitane Sardone, “Coronavirus Pandemic Could Elevate ESG Factors,” WSJ.com, last modified on March 25, 2020, https://www.nuveen.com/en-us/thinking/responsible-investing/fifth-annual-responsible-investing-survey.
2. Caitlin McCabe, “ESG Investing Shines in Market Turmoil, With Help From Big Tech,” WSJ.com, last modified on May 12, 2020, https://www.wsj.com/articles/esg-investing-shines-in-market-turmoil-with-help-from-big-tech-11589275801.
The information, analysis and opinions expressed herein are for informational purposes only and do not necessarily reflect the views of Envestnet. These views reflect the judgment of the author as of the date of writing and are subject to change at any time without notice. Nothing contained in this piece is intended to constitute legal, tax, accounting, securities, or investment advice, nor an opinion regarding the appropriateness of any investment, nor a solicitation of any type.