Millennials Could Drive More ESG Investing

A new survey by American Century Investments examines Millennials’ preferences pertaining to “impact” or “environmental, social and governance” (ESG) investing programs.

Matching the common assumption made about the generation’s investing preferences, American Century’s data suggests Millennials do in fact strongly favor investment opportunities that consider more than just a bottom-line return. Many would be willing to sacrifice some financial return to ensure their investments met certain ethical standards, often having to do with the environment and social justice issues.

Overall slightly more than half (51%) of Millennials say they view ESG/impact investing ideas favorably, while just 37% of Gen Xers and 32% of Baby Boomers agree. Millennials are also far and away the most likely to say their investments’ impact on society and the environment should be among the most important and primary considerations when building portfolios.

There is a range of ESG/impact investing themes that capture Millennial’s attention. For example, one in three Millennials said “health care, including disease prevention and cures,” is what “matters most to them if they were to make an impact investment.” It should be noted that American Century provides investment opportunities along these lines.

The reporting concludes that the promotion of impact investing may not be a priority of the Trump administration, but this could be compensated for by the enthusiasm of Millennial investors—and other generations as well.