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U.S. managed assets with socially responsible criteria rise - report
November 20, 2014 / 1:32 PM / 3 years ago

U.S. managed assets with socially responsible criteria rise - report

NEW YORK, Nov 20 (Reuters) - The share of U.S. managed assets invested with environmental, social or similar criteria rose 50 percent over the past two years, a foundation that tracks the field said, because of new disclosure standards and client concern about areas like climate change.

U.S. assets in strategies using what are often termed “socially responsible investing” guidelines stood at $6.57 trillion at the start of 2014, or 18 percent of total assets under professional management, up from $3.74 trillion, or 12 percent of the total at the start of 2012, said officials at US SIF - The Forum for Sustainable and Responsible Investment.

The nonprofit foundation, based in Washington and backed by investment companies, is scheduled to release a study on the trends on Thursday. Foundation Chief Executive Lisa Woll said the higher share of assets partly reflects new investor priorities like avoiding fossil fuel company stocks, or a move out of firearms stocks by some after the school shootings in Newtown, Connecticut in late 2012.

At the same time, big fund firms are applying environmental, social or governance criteria to larger parts of their portfolios and disclosing more of these efforts, the group found. “Investment firms have seen there is a demand from a range of investors for impact investments,” Woll said.

The report identified 325 investment vehicles with $275 billion in assets that considered climate change and carbon-related criteria to pick holdings, up from 280 such vehicles with $134 billion in assets in 2012.

The report cited American Funds parent Capital Group and Wellington Management Co. as firms using more socially responsible criteria. A Wellington spokeswoman declined to comment.

A spokesman for Capital Group, Chuck Freadhoff, said the Los Angeles investment company has used socially responsible principles to evaluate investments for many years, but that it is reporting more about its efforts after signing on to the United Nations-backed Principles for Responsible Investment in 2010.

For its biannual investment trends report, the foundation surveyed money managers and institutional investors, and reviewed financial filings.

The flow of money to these funds has been slower by other measures. The inflow rate to mutual funds using socially responsible criteria is just 7 percent so far in 2014, or $3.5 billion in new money, according to Thomson Reuters’ Lipper unit.

Reporting by Ross Kerber; Editing by Cynthia Osterman

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