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Sustainable Investing

New Study Reveals Key Insights Into Impact Investing Trends

Find out what individual investors worldwide think about impact investing today.


Impact investing aims to achieve two main objectives simultaneously: generating competitive long-term returns while also making a positive difference in society, often focusing on areas like health care, education or the environment.

We conducted our seventh impact investing survey in December 2023, gathering insights from individual investors worldwide to understand their perspectives on impact investing. The latest findings challenge some common assumptions about the preferences and priorities of impact investors, showing notable changes compared to last year’s survey.

Moreover, the results indicate a need for better communication with the asset management industry regarding what investors may expect from impact investing. Similar to last year, the survey includes diverse samples from the U.S., U.K., Germany, Singapore and Australia, representing various age groups.

Six key findings from the 2023 survey include:

1. Interest in Impact Investing Declined Compared to Last Year

Interest in impact investing has decreased across all surveyed countries, although it remains higher than in previous years of the survey. Notably, older investors (baby boomers) experienced the largest drop in interest, followed surprisingly by the youngest participants in the survey. One might expect retirees to be less interested in impact investing if they believe it means sacrificing significant returns. However, this assumption doesn’t hold true as we'll discuss shortly. For Gen Z investors (born 1997-2012), some may be disheartened by the slow progress on environmental and societal issues, leading to a loss of faith in impact investing. Alternatively, they may seek more direct methods to address these challenges, recognizing that they will affect their generation the most.

Interestingly, the reasons for the decline vary by region. In the U.S., backlash about incorporating ESG factors into investment decisions has helped fuel the shift in sentiment toward impact investing. Survey respondents in the U.K., Singapore and Australia cited concerns about potential greenwashing. Another possible global factor contributing to waning interest is that, at the time of the survey, sustainability-focused investment strategies had, in various ways, underperformed over the past few years.

2. Impact Investors Are Willing to Give Up Some Returns, but Not a Lot

In our view, this is a key point worthy of attention. Many survey participants want some of their investments to make a positive impact, but they are not naïve, gullible or overly idealistic. Their choice to engage in impact investing is grounded in pragmatism. Impact investing isn’t like charitable giving; impact fund managers pursue, and impact investors expect competitive returns.

Figure 1 shows that 60% of the U.S. impact investors surveyed are willing to sacrifice up to 10% of returns to positively impact their chosen area, but not more than that. A total of 22% are willing to give up no more than 15%. Moreover, investors typically allocate only a portion of their portfolios to impact funds, indicating that impact investing isn’t an all-or-nothing proposition.

Let’s consider how this might play out. Assume an “average” fund with no impact goal generated a 10% return for its shareholders. This means an investor with $200,000 in this fund at the beginning of the year would have $220,000 at the end of the year, excluding taxes. Suppose the investor had allocated 25% of that initial $200,000 to an impact fund at the start of the year. If that impact fund earned an 8.5% return (15% less than the non-impact fund), the investor would end the year with $219,250 across the two funds. As you can see, the difference isn’t substantial. Moreover, impact investors gain non-monetary benefits from knowing that their investments contribute to improving the environment and society. This could potentially lead to positive economic outcomes in the future.

Additionally, an impact fund might deliver returns comparable to, or even surpassing, those of non-impact funds, especially considering that non-impact funds may heavily invest in sectors that could underperform in a given year. Overall, we think these investors seem to be making balanced, pragmatic decisions when opting to allocate to impact funds.

Figure 1 | Impact Investors’ Willingness to Sacrifice Returns Varies

Amount Willing To Sacrifice







Don’t Know









































3. Impact Investors Aren’t Detached from Economic and Geopolitical Concerns

When survey participants were asked if the current market conditions, such as inflation and geopolitical tensions, affected their willingness to allocate to impact investing, approximately half acknowledged that it did. Among those who said the market environment affected their interest in impact investing, far more mentioned a negative effect rather than a positive one, except in Singapore.

While the economic climate could have affected investors’ readiness to invest in impact initiatives, most survey participants said the economy didn’t diminish the appeal of impact investing. However, the percentage of respondents who believed the economy made impact investing more appealing decreased. Two years of market volatility and challenging economic conditions may have taken a toll.

Market conditions in Australia, Germany and the U.K. influenced survey participants’ willingness to allocate to impact investing. Notably, inflation in these countries didn’t decline as quickly in 2023 compared to the U.S. In Singapore, where slightly more respondents favored impact investing due to the market environment, inflation was lower than in Europe, the U.K. and Australia. Additionally, Singapore’s stock market didn’t experience a significant downturn in 2022, unlike the other countries included in the survey; instead, it saw an increase. Our conclusion is that broad economic factors influence interest in impact investing. Investors act rationally and look at the big picture when making investment decisions.

4. Relative Appeal of Various Impact Categories Has Shifted

Among the most popular categories of impact investing, investors continue to prioritize health care and the environment — in that order — except in Germany, where impacting the environment came out on top. However, except for Singapore, there was a slight decrease in the percentage of respondents prioritizing environmental initiatives in the 2023 survey. This suggests that while other categories garnered increased attention, the shift wasn’t consistent across all regions.

Interest in impact investing with a focus on education grew in the U.S. and, to a lesser extent, in Australia. In Germany and Australia, there was heightened interest in investing with the goal of reducing poverty compared to the 2022 survey. Interest in investing to help support racial equity declined markedly in the U.S. but gained slightly elsewhere. In Singapore, the only developing economy included in the survey, improving gender equality was the area of impact investing that showed the biggest decline in interest, matching the decline in interest observed in the U.S. regarding improving racial equality.

5. Greenwashing vs. ESG Backlash

Less than one-third of respondents in the U.K., Germany and Australia, a decrease from last year’s survey, said greenwashing had affected their interest in impact investing. See Figure 2. In general, greenwashing is more of a risk in passive investing, where funds rely on ESG scores to select their holdings. Investors interested in impact funds might recognize that they are actively managed, offering detailed information about their investment approach and impact goals.

Figure 2 | Effect of ESG Backlash on Impact Investing Weakens Except in the U.S.

Respondents (%) Citing ESG Backlash as Influencing Their Interest in Impact Investing


















What’s next for impact investing? We believe asset managers need to better explain that investing for impact doesn’t mean giving up earning competitive returns. Investors face a challenging geopolitical landscape that could once again cause delays in supply chains or push energy prices higher. Deciding to allocate to impact investing is part of a mix of considerations.

Impact investing has a compelling narrative. As cutting-edge technologies move from research labs to the market, investing for impact offers a way to invest in trailblazing companies that deliver on the goal of “doing well by doing good.” This is particularly relevant to health care, climate change mitigation and water scarcity. Technological advancements can also play a crucial role in enhancing access to education and alleviating poverty, aligning with government initiatives in these areas.

While political pushback in the U.S. continues, we don’t believe Americans are anti-environment or anti-equality — they are focused on creating value, not imposing values. However, we think the exclusionary approach to sustainable investing may remain politically problematic. The asset management industry could do a better job of conveying that sustainable investing is fundamentally focused on the long-term viability of a company’s business model and the durability of its cash flow over time. This approach is entirely aligned with the pursuit of competitive returns for investors.

6. Health Care Continues to Be the Cause That Matters Most to Impact Investors in Most of the Countries Surveyed

American Century Investments has a unique perspective on impact investing in medicine and health care. Over 40% of our dividends support the Stowers Institute for Medical Research, a world-class biomedical research organization with an equity stake in American Century. We have generated nearly $2 billion in dividends for the Stowers Institute since 2000.

Our relationship with the Stowers Institute allows us to impact global health while helping our clients achieve their financial goals. Our purpose-driven business model sets us apart in the industry, and our connection with the Stowers Institute has helped to shape our culture and make it easy to incorporate sustainability into our investment practices.

In general, our impact investing surveys have shown that while the appeal of impact investing may experience short-term fluctuations, it has increased over time across different nations and generations for men and women. Even subgroups where interest has lagged are making gains.

We believe the long-term drivers of impact investing are similar to the factors that drive interest in sustainable investing in general — the underlying economics, a demand for quality investments and regulation. All three remain intact and, in our view, will continue to motivate investors who want to use a portion of their investments to generate both returns and a positive impact.

Survey Methodology
The 2023 survey was conducted with representative samples of adults ages 18 and older. It encompassed 1,007 participants in the U.S., 1,004 in the U.K., 1,003 in Germany, 1,005 in Australia and 1,002 in Singapore. The study utilized Big Village’s Online CARAVAN Omnibus Survey, with results weighted by age, sex, geographic region, race and education to ensure reliable and accurate representations of the adult populations in each country. For this survey, millennials were defined as those ages 25 to 40, Generation Xers as those 41 to 56 and baby boomers as those 57 to 75.

Sarah Bratton Hughes
Sarah Bratton Hughes

Senior Vice President

Head of Sustainable Investing

Managing Money, Making an Impact

Learn more about how we help our clients Prosper With Purpose®.

Sustainability focuses on meeting the needs of the present without compromising the ability of future generations to meet their needs. There are many different approaches to Sustainability, with motives varying from positive societal impact, to wanting to achieve competitive financial results, or both. Methods of sustainable investing include active share ownership, integration of ESG factors, thematic investing, impact investing and exclusion among others.

Many of American Century’s investment strategies incorporate sustainability factors, using environmental, social, and/or governance (ESG) data, into their investment processes in addition to traditional financial analysis. However, when doing so, the portfolio managers may not consider sustainability-related factors with respect to every investment decision and, even when such factors are considered, they may conclude that other attributes of an investment outweigh sustainability factors when making decisions for the portfolio. The incorporation of sustainability factors may limit the investment opportunities available to a portfolio, and the portfolio may or may not outperform those investment strategies that do not incorporate sustainability factors. ESG data used by the portfolio managers often lacks standardization, consistency, and transparency, and for certain companies such data may not be available, complete, or accurate.

The opinions expressed are those of American Century Investments (or the portfolio manager) and are no guarantee of the future performance of any American Century Investments' portfolio. This material has been prepared for educational purposes only. It is not intended to provide, and should not be relied upon for, investment, accounting, legal or tax advice.