Marked rise in sustainable investment activity among institutional investors

Institutional engagement in sustainable investing has increased by more than 80% since 2018, according to a client survey undertaken by Cambridge Associates.

Two-thirds (65%) of the institutional investors surveyed are now engaged in sustainable and impact investing compared to 36% in 2018, according to the US investment firm’s research. The 29-percentage-point difference is equivalent to an actual increase of 81%.

“The continued expansion of sustainable and impact investing across markets reflects a growing recognition that these factors are material to investment decision-making and long-term portfolio outcomes,” said Liqian Ma, global head of sustainable and impact investing research at Cambridge Associates.

The majority of the 144 respondents to the survey came from foundations, colleges and universities. Families and high-net-worth individuals were also surveyed, of which just over half (52%) also reported being engaged in sustainable and impact investing.

More than half of the institutions implementing a sustainable investment strategy had over 5% of their long-term investment pool allocated, and 88% of those institutions had increased their allocation to this area in the past five years.