Impact Investing: the Facts Speak for Themselves

At Social Impact Capital, our investment thesis is shaped by the profound demographic shifts that are occurring: all the data indicates that impact investing and companies with a positive benefit to society will continue to outperform.

• The biggest transfer of wealth in human history has started. Over the next 35 years as an unprecedented $58.7 trillion dollars of wealth transfers to women and millennials. Paul G. Schervish and John J. Havens, Millionaires and the Millennium: New Estimates of the Forthcoming Wealth Transfer and the Prospects for a Golden Age of Philanthropy, The Center on Wealth and Philanthropy (CWP) of Boston College, May 28, 2014
• Women will inherit 70% of this wealth. By 2030, two thirds of the wealth in the United States will be in women’s hands. Melanne Verveer, Ambassador-at- Large for Global Women’s Issues, US Department of State, Women as Economic Drivers, The Journal AARP International
• Women care greatly about impact investing. 76% of women say they want to invest in organizations promoting social well-being. 90% of inheriting women will become solely responsible for their wealth. Over 70% of women fire their financial advisors within one year of financial control.
• Millennials care greatly about impact investing. 93% of Millennials believe that a company’s social and environmental impact is key to their investing decisions; this number is up from 74% only two years ago. 67% of millennials agree that “My investment decisions are a way to express my social, political, or environmental values.” 61% of millennials feel lower returns on an investment in exchange for having a positive impact on society or the environment are acceptable. 71% would turn down the opportunity to make a significant sum of money if it required investing in a company with a negative impact on society or the environment. U.S. Trust, Insights on Wealth and Worth, 2016; 2014.
• Millennials care deeply about social change. 7 in 10 young adults consider themselves social activists; this was nearly double the amount from one just one year before. Survey by TBWA/Worldwide and TakePart of Participant Media, 2011.
• The old financial advisors will be fired. 86% of heirs in global family offices intended to fire their parents’ investment advisors once they inherited their wealth. Rothstein Kass, 2009
• The market for impact investing is already large. $13.6 trillion of professionally managed assets incorporate environmental, social and governance (ESG) concerns into investment selection and management, or 21.8% of total AUM. The Global Sustainable Investment Alliance, Global Sustainable Investment Review 2012.
• The market for impact investing is already growing. From 2012–2014, sustainable investing experienced a growth of 146%. New York Society of Security Analysts
• Companies that create a positive social impact should outperform. 45% of employees would take a 15% pay cut to work for companies that make an environmental or social impact. There is 55% better employee morale at companies that have a social impact, and 38% better employee loyalty. 80% of Millennials want to work for a company that cares about how it impacts society. 91% of global consumers are likely to switch to brands that support a good cause, given similar price and quality. 90% of consumers are more likely to trust and be loyal to socially responsible businesses. Companies with a social impact have a 43% better public image.