Among other highlights of the report:

Money managers reported applying fossil fuel divestment policies across $1.2 trillion in assets under management, ranking fourth among all the ESG criteria they address. Avoidance of military- and weapons-related investments and tobacco-related investments ranked second and third for money managers, affecting $1.8 trillion and $1.7 trillion in assets, respectively.
For institutional asset owners, the second-most-important ESG issue factored into investment decision-making was avoidance of companies doing business in countries with high-conflict risk, affecting $3.3 trillion in assets. Board issues and sustainable natural resources and agriculture were the third- and fourth-most-important ESG issues for institutional investors in asset-weighted terms, affecting $2.9 trillion and $2.8 trillion,
From 2020 through the first half of 2022, 154 institutional investors and 70 investment managers controlling $3 trillion in assets under management led or co-led shareholder resolutions on ESG issues.
The leading ESG issue raised in shareholder proposals was ensuring fair workplace practices, particularly ending de facto discrimination based on ethnicity and sex. Close behind in the numbers of proposals filed were concerns about corporate political activity and climate change.
Community investing experienced rapid growth, with assets under management increasing 72% to $458 billion over the past two years and increasing more than 600% in the last decade.

The research took place as major regulatory developments occurred that will likely shape sustainable investing for years to come. The U.S. Securities and Exchange Commission released two proposals, one to prevent misleading fund names and another to require greater transparency around funds' consideration of ESG factors. In addition, the U.S. Department of Labor ruled that ERISA-governed pension plans may include ESG-oriented funds and removed impediments to shareholder engagement and proxy voting.

Instant Insights /

ESG investments lower than expected, totaling $8.4 trillion: Here's why

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