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November 30, 2001
SIF Reports on Socially Responsible Investment Growth in the U.S.
    by William Baue

In its biennial report, the Social Investment Forum documents modest gains in socially responsible investments.

Overall socially responsible investing increased by eight percent from 1999 to 2001, according to the 2001 Report on Responsible Investing Trends in the United States released Wednesday by the Social Investment Forum. SIF points out that nearly one of eight dollars under professional management in the United States is now invested employing one or more of the three strategies that define socially responsible investing: screening, shareowner advocacy, and community investment.

Overall U.S. investment through professional managers amounted to $19.9 trillion as of December 31, 2000, according to the most recent available statistics in the 2001 Nelson’s Directory of Investment Managers. SIF conducted its own research over the first half of 2001, commissioning independent assistance from, an online survey firm, and the Hastings Group, a public relations firm, among others. SIF determined that $2.34 trillion is invested in the U.S. in a socially responsible manner. Thus socially responsible investing accounts for 11.75 percent of all U.S. investing.

This percentage dropped slightly since SIF’s last study, released in 1999, which reported more than one in eight dollars invested with social responsibility in the U.S. Social investing in the U.S. totaled $2.16 trillion in 1999, according to SIF’s previous report. That year, overall U.S. investing amounted to $16.3 trillion, according to Nelson’s. Thus socially responsible investing accounted for 13.25 percent of all U.S. investing in 1999.

SIF breaks down the results for socially responsible investing into categories according to the three strategies of socially responsible investing: $1.4 trillion of socially responsible investments employ screening only; $305 billion employ shareowner advocacy only; and almost $8 billion represent community investing. As well, SIF includes a category for investments that employ both screening and shareowner advocacy, which amounted to $601 billion.

Comparing these numbers to SIF’s 1999 results, investments employing screens alone grew by almost 17 percent, from $1.2 trillion in 1999; investments employing shareowner advocacy alone fell by almost 54 percent, from $657 billion; and community investing rose by almost 41 percent, from $5.4 billion. Investments combining screening with shareowner advocacy rose by 36 percent, from $265 billion in 1999.

The report’s Executive Summary and SIF’s Press Release highlight this last statistic, noting that it represents an increase of 1.5 times the growth experienced by overall U.S. investments, which rose by 22 percent from 1999 through 2001. However, this growth represents not so much new investments, but predominantly the shifting of existing investments from one category, shareowner advocacy alone, to another, advocacy and screening combined.

“What we’ve seen over time is that money that gets involved in one of the SRI [socially responsible investing] strategies tends to embrace the other strategies over time,” said SIF spokesperson and President of First Affirmative Financial Network Steve Schueth. “What we saw here was a lot of money that was involved in advocacy in previous years is now involved in screening as well,” he explained, characterizing this as a natural progression.

Other results reported by SIF: community investing experienced a 41 percent increase, from $5.4 billion in 1999 to $7.6 billion in 2001. Considered as a percentage of overall socially responsible investment, community investing rose from a quarter to a third of a percent between 1999 and 2001. This growth supports SIF’s “One Percent in Community Campaign,” an initiative seeking to increase community investment to one percent of all socially responsible assets.


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