Funds raise the bar on ESG strategies to attract HNWIs

Over the past several years, institutional investors have increasingly considered environmental, social, and governance (ESG) factors when investing. Today, high-net-worth and family office investors are also increasingly accounting for certain ESG factors when evaluating potential investments.

While the question “What is ESG?” is harder to define for certain investment types, real estate is a particularly fertile asset class for ESG considerations. This is largely due to real estate’s inherent potential to impact the immediate environment and the outsized role some properties can play in local economies. But investors remain cautious when evaluating a manager’s ESG policies and procedures. As with any investment considerations, it is still important to link goals with actionable items and quantifiable return on investment.

ESG interest continues to grow among investors, investment managers with strong ESG policies will likely continue to differentiate themselves.

Read more from Plante Moran Realpoint Investment Advisors (PMRIA), formerly Plante Moran REIA’s Zack Otte and others in this discussion.