NEW YORK, April 15, 2019 /PRNewswire/ — A major new research study released today from Newton Investment Management, a BNY Mellon Investment Management firm, revealed that more than half (55%) of American investors are unfamiliar with the concept of “Social Investment,” defined here as the collective term for investments that seek to achieve some combination of economic, social, and environmental goals (ESG, responsible investing, etc.).
“The study results make us ask why social investment isn’t more widely understood and why it’s not been more widely adopted in the U.S.,” said Julian Lyne, Chief Commercial Officer of Newton Investment Management. “One explanation is that investor interests need to be better matched with social investment options that make sense to investors. This study makes a strong case for the importance of asset managers with expertise in the space helping connect the dots for investors between social interests and investment outcomes they’re looking for.”
Newton’s Social Investment research study, created by Oxford Risk and fielded by Research Now, surveyed nationally a statistically relevant group of 1,023 individual investors age 18 or older with at least $40,000 in investible assets. The study examined individual investors’ attitudes and behaviors toward social investment, what drives investor interest, investor goals, and reasons that prevent individuals from social investment.
The research dives deeper into the motivational and attitudinal factors that individuals differ on, as well as the obstacles that stop them from investing and the steps that could be taken to engage investors based on their past experiences with social investment. While the study found that in general demographic variables are not strong predictors of interest in social investment, age and household savings proved significant factors. For example, the study demonstrated a significant divergence between millennials and Baby Boomers, with 69% of adults 39 or younger showing interest in social investment compared with just 21% of older Americans over the age of 50. Likewise, households with greater cash savings balances also diverged, with nearly half (49%) of households with savings between $500K-$1.5M showing interest in social investing compared with just 38% of households with savings of less than $499K.
The study derived six “Social Investment Profiles” that indicate characteristics of different representative groups of the investing population, highlighting the barriers and opportunities most relevant to each type of individual (full Social Investment Profiles linked here). For example, contrasts exist between investors who are prepared to trade off liquidity or risk for social outcomes and those who are not, suggesting that a broad-brush approach to social investment does not work.
“This research offers valuable, measurable insight on investor attitudes towards all types of responsible, social investment, which is an area that Newton has pioneered over the last 40 years,” said Lyne. “The findings highlight the importance of a tailored approach to educating and helping connect the dots for investors between social interests and the investment outcomes they’re looking for.”
Complete research study findings, fact sheet, and methodology are available at the link.
Newton Investment Management Social Investing National Research Study Methodology Behavioral finance specialists Oxford Risk, on behalf of Newton Investment Management, designed the academic research study, which was fielded by Research Now across the U.S. among a broad spread of respondents by age, gender, geographic location, education, and wealth, from October 29-31, 2018. Oxford Risk conducted the self-administered study online among 1,023 individual investors, age 18 or older, with at least $40,000 in investible assets.
The sample was representative of the investor population (i.e., those over 18 with access to some investible wealth), and captured a broad spread of respondents by age, gender, geographic location, education, and wealth. The survey took each respondent approximately 15 minutes to complete, and, to ensure academically reliable findings, the questions were randomized for each individual, thus avoiding biases that often arise from question ordering. The data was put through a battery of statistical analyses (including factor analysis, cluster analyses, and fully controlled multivariate regressions) to ensure findings were valid and robust. No data was requested or collected concerning specific investment, banking, advisory or similar financial relationships with Newton Investment Management, Bank of New York Mellon or any other institution, organization, agency or firm. Respondents were paid for participating to create an unbiased sample; all information was self-reported by study participants.
About BNY Mellon Investment ManagementBNY Mellon Investment Management is one of the world’s largest investment managers, and one of the top U.S. wealth managers, with $1.7 trillion in assets under management as of December 31, 2018. The firm is built around delivering to investors a “best of both worlds” approach: the expertise and world-class capability of our individual investment specialists, wedded to a global geographic footprint, and guided by an unshakable commitment to financial stewardship. BNY Mellon Investment Management encompasses BNY Mellon’s affiliated investment management firms, wealth management services and global distribution companies.
BNY Mellon Investment Management is a division of BNY Mellon, which has $33.1 trillion in assets under custody and/or administration as of December 31, 2018. BNY Mellon can act as a single point of contact for clients looking to create, trade, hold, manage, service, distribute or restructure investments. BNY Mellon is the corporate brand of The Bank of New York Mellon Corporation
About Newton Investment Management Ltd Newton Investment Management (NIM) is a London-based global investment management subsidiary of The Bank of New York Mellon Corporation. NIM and Newton Investment Management (North America) Limited (NIMNA) are authorised and regulated by the Financial Conduct Authority. NIMNA is also registered with the US Securities and Exchange Commission. Registered address, The Bank of New York Mellon Centre, 160 Queen Victoria Street, London, EC4V 4LA. Registered in England No. 01371973 (NIM) and No. 2675952 (NIMNA). With assets under management of $59.5B as of December 31, 2018, Newton provides investment products and services to a wide range of clients, including pension funds, charities, corporations and (via BNY Mellon) individuals. News and other information about Newton is available at www.newtonim.com and via Twitter: @NewtonIM.
Media Contacts: Andrew Conn
BNY Mellon Investment Management
BNY Mellon Investment Management
This information may contain forward-looking statements, which may be expressed in a variety of ways, include the use of future or present tense language. These statements and other forward-looking statements are based upon current beliefs and expectations and are subject to significant risks and uncertainties (some of which are beyond BNY Mellon’s control). Factors that could cause BNY Mellon’s outcomes to differ materially from those described in the forward-looking statements can be found in the risk factors set forth in BNY Mellon’s Annual Report on Form 10-K for the year ended Dec. 31, 2018, the Quarterly Report on Form 10-Q for the period ended December 31, 2018, and its other filings with the Securities and Exchange Commission. All forward-looking statements in this news release, speak only as of the date of publication and BNY Mellon undertakes no obligation to update any forward-looking statement.
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