Millennial investors demand solid ESG policies and transparency, part 2

By Nick Curwen

In the first of our two-part blog series, we talked about millennials, how they are likely to invest, and the depth of their investment knowledge. We now address how strong, solid transparency and ESG policies will attract this elusive investor.


The millennial generation is cost conscious and technologically advanced. Investors want price transparency and for charges to be clearly referenced. Some official rules (e.g. Markets in Financial Instruments Directive II [MiFID II]) make this obligatory for many managers.

However, information must be disclosed to clients in an accessible format. A paper trail of cost reports is no longer acceptable; today’s investors expect real-time, mobile reporting. Fund managers either need to build such functionalities into their internal systems or engage a service provider with a strong technology background to manage the process for them. Without transparency, firms will not attract today’s investors.

Environmental, social, and governance (ESG) policies

To attract millennial investors, managers must do more than just provide transparency. This group of investors consider fund managers’ ESG policies to be just as important as their performance. One Morgan Stanley report states that 86% of millennials are interested in socially responsible investing, and they are twice as likely to invest in a security or fund if social responsibility is part of the value creation.[1] Another Schroders report found that millennials will hold their investment up to twice as long if the fund has a clear ESG policy.

This preference was evidenced in last year’s growth in exchange traded funds (ETFs), which offer investors exposure to baskets of securities based on sustainability.

More and more institutional investors are taking a proactive and engaged stance on such issues. To attract younger investors, managers must be committed to ESG, or at least offer products that are inclusive of ESG.

One investor criticism of asset managers’ approach to ESG is that the associated reporting is inconsistent. To address this concern, fund managers should speak to service providers about the best way to integrate ESG reporting into the investor disclosure.

SS&C is a world leader in alternative investment technology solutions and services, with more than $1 trillion in assets under administration. We equip our clients with modern and sophisticated tools, so that they can provide detail and transparency to all their investors. To learn how we can help you, contact


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