Ever had trouble convincing your clients of the value of CSR efforts? We’re guessing the answer to that question is “yes” because, in most cases, businesses judge the importance of public sentiment on the degree to which it influences investor relations.
We found a recent piece in The Guardian encouraging in that regard, however: as the average age of the investor class goes down, its interest in CSR and “profit with purpose” goes up.
As writer/former Goldman Sachs analyst Michael Sidgmore puts it, “The next wave of investing is being shaped by generational shifts in money, mentalities, and manpower.”
What does that mean? It means hedge funds investing in clean energy/tech initiatives as well as rewarding businesses for initiatives related to climate change and problems stemming from the scarcity of resources like fresh drinking water.
The younger generation has influenced those who preceded it as well—the many green investments made by Tesla’s Elon Musk are a prime example. Sidgmore’s point? The companies that stand out to future investors will be the ones who manage to balance profit with more ambitious social initiatives in the “sustainable finance” category.
Here’s the key stat:
“The World Economic Forum predict[s] a $41tn wealth transfer (PDF) from baby boomers to millennials over the next 40 years.”
We’ll be watching for more posts in what The Guardian describes as “a new series” dealing with this generational changing of the guard (hashtag #NextGenInvest).