[02.09.2008] Eurosif’s study finds that sustainable investments by High Net Worth Individuals (HNWIs) is predicted to exceed €1 trillion by 2012.

Eurosif estimates that sustainable investments represent approximately 8% of European HNWIs’ portfolios as of December 31, 2007 and predicts that by 2012 the share will have increased to 12%.The sustainable investment strategy most often employed among HNWIs is thematic investment, with clean energy and water as their preferred sustainable themes.

There are three drivers in the intersection of HNWIs and sustainable investing that will lead to future growth of the SRI market in the coming years:

• The amount of wealth available for investing by this group is at an all time high and projected to expand further.

• The demand for ‘sustainability criteria’ as an offering within this sector is growing largely dueto a generational shift in thinking about capital growth and preservation as well as financial outperformance prospects.

• HNWIs have transitioned from only doing philanthropy to increasingly integratingsustainability criteria in their actual investments, reflecting a growing consensus that financial returns are consistent with sustainability issues.

Andreas Knörzer, Managing Director of the Sustainable Investment business unit at Bank Sarasin, says “The results of the study clearly show that wealthy investors are at the heart of sustainable investment. Eurosif’s research in this area clears up the distorted picture that large private capital owners areresponsible for most ecological and social problems today. Investment strategies of High Net WorthIndividuals are not part of the problem, but creating paths towards the solution.”

The market is currently in an early, high growth phase with 72% of respondents seeing an increase in HNWI interest for sustainable investment in the last 12 months, principally driven by market demand. Inspite of the recent market turmoil, 87% of respondents think the interest for sustainable investments willgrow in the next three years. Moreover, 75% of surveyed family offices think that sustainable investment will increase in the generational transfer of their family’s wealth.

The study shows that HNWIs are open to new and alternative sustainable investments. Eurosif executive director Matt Christensen says “Servicing the HNWI segment offers great opportunities forproduct innovation which could eventually prove useful for other investor segments such as institutionalinvestors. About a third of sustainable products are currently bespoke sustainable investments, which are vital to product development.”

Based on the findings of this survey, Eurosif is convinced that the growth of HNWI interest insustainable investment will steadily correlate towards a greater openness to integrate these issues into other levers of society.

High Net Worth Individuals and Sustainable Investments (PDF 2,8 Mb, 32 p.)

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