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Srbo Radisavljevic
Managing Principal/Investment Advisor

Edge Portfolio Management


State: IL

At Edge, a low client to advisor ratio allows for personal and customized service for each individual.  Our goal is to work as a team for each client to provide not only portfolio management but wealth coordination and financial planning.  We make every effort to have frequent communication with our clients and to provide timely response to calls and emails.  I also enjoy spending time with my wife and three kids, following Chicago sports, enjoying ethnic cooking, and serving as a school board member for Norridge School District 80.

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Investopedia, November 13, 2015 - Socially Responsible Investing: How Millennials are Driving It

| BY Wendy Connett

Financial advisors with young affluent clients or those looking to attract them may want to consider socially responsible investments (SRIs).

More than a quarter of investors under the age of 45 have allocated at least 25% of their investments in socially responsible companies, according to a study by Spectrem Group. This compares to more than 45% of all investors older than 45 years old who do not invest in socially responsible companies. Spectrem surveyed 3,070 investors with assets ranging from $100,000 to $25 million.

Socially responsible investing has expanded at a rapid pace among all investors in the last few years. Assets in these investments have grown 76% to $6.57 trillion in 2014, up from $3.74 trillion in 2012, according to the Forum for Sustainable and Responsible Investment. Assets managed with SRI strategies now account for more than one out of every six dollars under professional management in the U.S. (For related reading, see: Ethically Investing: Social Responsible Investing.)

How Millennials Are Driving It

For almost half (49%) of Millennials with a net worth of more than $1 million, social responsibility is a factor in choosing an investment, according to Spectrem’s research. This compares to 43% of Gen X, 34% of Baby Boomers and 27% of seniors.

For Millennials who are not millionaires, social responsibility was an even higher priority. Fifty-three percent make investment decisions based on social factors, compared to 42% of Gen Xers, 41% of Baby Boomers and 39% of seniors.

Spectrem research has also found that Millennials are the most cynical when it comes to corporations who claim to be socially responsible. Three-fourths of millionaire Millennials (compared to 49% overall) said they believe that socially responsible corporate behavior is nothing more than public relations, according to a separate study Spectrem conducted in 2013. (For related reading, see: Extreme Socially Responsible Investing.)

Millennials show far less concern over issues outside the social responsibility area. While 64% of seniors are concerned over terrorism, just 36% of Millennials share that worry. Eight-four percent of seniors are concerned over the political environment in the U.S., compared to 54% of Millennials.

Who Knows SRIs

Spectrum found that familiarity with SRIs was higher among younger investors. It also found that the wealthier the investor, the more familiar they were with socially responsible investing.

Spectrum asked survey respondents to rate their familiarity with terms related to SRI on a scale ranging from 0 (no familiarity) to 100 (great familiarity). Overall, the familiarity with socially responsible investing clocked in at 46.75. Familiarity with impact investing was much lower at 28.94.

In general, the younger the investor, the more familiarity he or she has with socially responsible investing. Among investors under the age of 36, familiarity with socially responsible investing was at 47.42, and familiarity with impact investing was at 35.76.

Ultra-high net worth investors, or those with a net worth between $5 million and $25 million, reported familiarity with socially responsible investing at 55.11, well above the average. The familiarity among mass affluent investors, or those with a net worth between $100,000 and $1 million, came in at 42.24. (For related reading, see: Vehicles for Ethical Investing.)

Men reported more familiarity with socially responsible investing than women. Their rating was 49.27 compared to a 42.37 familiarity rating for women. Familiarity with impact investing, meanwhile, was at 31.22 for men compared to just 25.02 for women.

Why and Where

The main reason why investors choose to invest in socially responsible firms is to create a better world for their children and grandchildren, according to Spectrem. Most investors who don’t choose socially responsible investments invest purely for financial gain.

Water conservation, promoting good health and exercise, and developing solar energies are socially responsible investors' top three organization/charity types of choice.

The Bottom Line

Socially responsible investing is a priority for much of the younger affluent generations, Gen Y in particular. Advisors looking to attract this demographic should consider socially responsible investments as one of the ways to do so.


Read more: Socially Responsible Investing: How Millennials are Driving It http://www.investopedia.com/articles/professionals/111315/socially-responsible-investing-how-millennials-are-driving-it.asp#ixzz3rfqgGZjg