Impact investors focus on climate change, racial equity and Covid-19

Impact investors put their money where they say. That's according to a biennial survey of about 800 individual and institutional investors conducted by nonprofit investment firm Calvert Impact Capital. He revealed that many more respondents said they had made impact investments than two years ago.

Also, while the focus on climate change investing continues to be a major driver for investors, so are race-related options. And Covid has boosted general interest in the sector to mitigate the effects of the pandemic.

"We're seeing an increase in engagement that translates into action," says Justin Conway, Vice President of Investment Partnerships at Calvert.

Learn more about the results:

More investments. In 2020, while 70% of respondents said they planned to increase their impact investments, only 19% had made a recent investment. Two years later, fewer respondents overall (66%) indicated their intention to increase their impact investments, but 59% said they had recently made such investments. And more than 80% of properties said they plan to do more.

Main areas of interest. More than half of respondents said they had invested to address climate change in the past two years, and 39% said they had recently made impact investments aimed at addressing racial equity and justice. More than 20% said the pandemic was a motivator to get involved in impact investing.

Big changes from 2018. In 2018, most respondents indicated that less than 5% of their total investment portfolios were allocated to impact investing.

Activity of financial adviser. About 80% of financial advisors said they have made at least one new investment on behalf of their clients to fight climate change since 2020 and 74% have made at least one new investment on behalf of their clients to fight racial equity since 2020.

Community Investment Notes are a first step. More than half of respondents said Calvert's Community Investment Notes, fixed-income securities that fund impact organizations, were their first impact investment. And of those investors, 62% said they made further impact investments after this initial investment.

Financial advisors drive impact investing

Calvert Impact Capital

There was also a marked increase in the number of respondents who added written comments about the investments they had made. According to Caroline Shenoy, head of investor relations at Calvert, most mentioned various ratings, crowdfunding options, community development loan funds, and some private equity.

As for investment barriers, they have not changed. As in previous surveys, the most important was the ease of access (or lack of access) to the products.