The Global Sustainable Investment Review 2018 summarizes the status of sustainable and responsible investing in Europe, the United States, Canada, Japan, and Australia and New Zealand. In the period since the last report was released, the global sustainable investment market has continued to grow, and in most of the regions covered by GSIA’s member organizations, its share of professionally managed assets has also grown.
Globally, sustainable investing assets in the five major markets stood at $30.7 trillion at the start of 2018, a 34 % increase in two years. In all the regions except Europe, sustainable investing’s market share has also grown. Responsible investment now commands a sizable share of professionally managed assets in each region, ranging from 18 percent in Japan to 63 percent in Australia and New Zealand. Clearly, sustainable investing constitutes a major force across global financial markets. From 2016 to 2018, the fastest growing region has been Japan, followed by Australia/New Zealand and Canada. These were also the three fastest growing regions in the previous two-year period. The largest three regions— based on the value of their sustainable investing assets—were Europe, the United States and Japan.
As in 2016, the largest sustainable investment strategy globally is negative/exclusionary screening ($19.8 trillion), followed by ESG integration ($17.5 trillion) and corporate engagement/shareholder action ($9.8 trillion). Negative screening remains the largest strategy in Europe, while ESG integration continues to dominate in the United States, Canada, Australia and New Zealand in asset-weighted terms. Corporate engagement and shareholder action is the dominant strategy in Japan.
Impact investing is a small but vibrant segment of the broader sustainable and responsible investing universe in all the markets studied. GSIA defines impact investing as targeted investments aimed at solving social or environmental problems. Community investing, whereby capital is specifically directed to traditionally underserved individuals or communities, is included in this category, as is finance that is provided to businesses with an explicit social or environmental purpose.