Seeking Sustainability: Four Types Of Responsible Investing
Aon breaks the world of responsible investing into four primary subcategories.
Rollover/click investing categories for more information.
Socially responsible investing (SRI)
social and governance integration
Mission-related investing (MRI)
Often referred to as “doing good and doing well,” the goal of impact investing is to generate returns while having a positive impact on a particular demographic group, business outcome or environmental factor. Examples of impact investing might include investments in public health facilities, workforce housing, cleantech or renewable energy.
A growing body of research argues that certain
ESG factors will have an impact on the global economy (such as climate change) and on individual corporate results. Aon views nonfinancial ESG factors as potential risks that can and should be monitored. Since ESG
data tend to be neutral, few sectors or investments would be off the table.
Examples of MRI investing may include faith-
based investing or investing to extend a foundation’s grantmaking capabilities.
SRI involves the avoidance of or taking money out of an investment or group of investments, usually based on an investor’s or organization’s value system. Examples of SRI investing might include fossil-fuel-free or tobacco-free investment initiatives and not selecting arms manufacturers or private prison companies.
Sources: Aon’s Global Perspectives On Responsible Investing report