MLR

Young investors more socially conscious

The younger the investors, the more likely they are to consider the impact of their investment decisions on society and the environment, according to a new study.

plant in hand

Nearly 7 in 10 young investors age 18 to 32 believe investment decisions are a way to express their social, political or environmental values, according to the new study 2013 Report and Wealth and Work by U.S. Trust.

That’s more than twice as much as their counterparts older than 49.

Of the 700 Americans surveyed – all of whom had assets totaling more than $3 million, not including their primary home – 45 percent consider their investment decisions as a way to express their values and are conscious of the impact made by companies in which they invest.

Regardless of the investment potential, nearly two-thirds (63 percent) of all respondents would not invest in companies that are harmful.

Those young investors would also be willing to accept a higher risk on investments in companies that have a greater positive impact on society (72 percent), compared to older investors – 35 percent for investors age 49-67 and 37 percent for investors over age 68.

More than half of investors age 33 to 48 (56 percent) also follow their values when investing and would be willing to accept a lower return on investment in companies that have a greater positive impact on society (58 percent) and accept a higher risk on companies that create products that have a positive social or environmental impact (50 percent).

Only about a quarter of investors have reviewed their investment portfolio for social, political and environmental impact. About one-third of younger investors have reviewed their portfolios, while only one-fifth of those over age 49 have.

Women generally have stronger feelings about the importance of investing in companies that show more positive social or environmental impact, the study found, by about 14 percentage points.