A new survey from the Morgan Stanley Institute for Sustainable Investing and Morgan Stanley Investment Management shows the increased adoption of ESG by institutional investors.
The survey found that among institutional asset owners 57% said they see a time when they
will only allocate to managers with a formal ESG approach and 95% are integrating or considering integrating sustainable investing in all or part of their portfolios. The adoption of ESG strategies has increased from 70% of asset owners in 2017 to 80% in 2019.
However, 33% of respondents say they lack adequate tools to assess investments against their ESG goals with data quality and availability being the chief concern. The ESG priorities among investors include climate change, water solutions and plastic waste.
ESG integration is the most popular strategy with 92% of survey respondents using this and 82% employ restriction screening, most commonly for weapons, tobacco and coal.