Apparently millennials are more than man-buns, gentrification or an avocado obsession. Millennials, defined as people with birth dates from early 1980s to late 1990s, are leading the sustainable investment surge in the United States. Aligning their personal values with their investment practices, wealth and asset managers have seen a significant influx of clients dominated by individuals under 35 years old.
According to Institute for Sustainable Investment’s 2017 report, millennials are twice as likely as other age groups to “invest in companies or funds that target social or environmental outcomes”. This generation group “overwhelmingly believes that their investment decisions can make an impact in leading the sustainable investing charge” said the report. The report also showed an increase in interest for sustainable investment for all ages from 2015 to 2017, but more markedly for millennials as 86% of the population being interested in sustainable investing compared with 75% of other investors. Interestingly enough, women lead men in their interest in this endeavor but both genders have a statistically equal likelihood of having integrated sustainability into their investment decisions (40% for women and 35% for men).
The total investor pool in the same survey had appreciable gains in the adoption of sustainable behaviors but millennials still were twice or more likely to have engaged in the same sort of actions. This trend has helped the sustainable investing market to find its way into the financial mainstream and Wall Street. We have seen $4 trillion in global assets worth investment firm Vanguard Group urging companies, such as ExxonMobil, to disclose the climate risks to their future business model. Bank of America (BoA) committed $125 billions by 2025 to low-carbon financing and sustainable business activities. Moreover, BoA is one of the world’s biggest investors in green bonds – which, along blue bonds are being called a new front of climate finance. JPMorgan Chase & Co. is also undertaking a leading role in the Green Bonds market, having underwritten more than $3.3 billions in Green Bonds since 2007. Also, they have participated in more than $11.0 billions of transactions that helped grow renewable energy and clean technology companies.
“In the absence of leadership from Washington, states, cities, colleges and universities, businesses and investors, representing a sizeable percentage of the U.S. economy will pursue ambitious climate goals, working together to take forceful action and to ensure that the U.S. remains a global leader in reducing emissions. It is imperative that the world know that in the U.S., the actors that will provide the leadership necessary to meet our Paris commitment are found in city halls, state capitals, colleges and universities, investors and businesses.” reads the open letter of the We Are Still In campaign. A beautiful outpour of bottom-up resilience, much needed in the brinks of crisis.
Millennials commonly have a new way of seeing the world and their role in this funny place we call Earth. Their demand for corporate social responsibility is reshaping brand strategies. It’s the new ideas about what’s important, both in life and in work, that can reshape the world we live in.