ESG on minds of one in four family offices

Caroline Zheng

Over a quarter of family offices and private investors surveyed were allocating more than half of their portfolios to impact investments or projects based on environmental, social, and governance factors, according to the Sustainable Finance Initiative.

The platform, which connects and supports sustainable investors, interviewed 100 family offices and private investors in May to explore their motivations, approaches, and sentiment toward impact investing - an investment strategy that seeks to generate positive social or environmental impacts alongside financial returns.

The survey found that 26 percent of respondents were investing at least half of their portfolios to impact or ESG-based projects, with an additional 23 percent committing between 10 and 50 percent. Another 34 percent invested between 1 and 10 percent, while 17 percent reported no current involvement in sustainable investments.

When asked about key themes for 2024, respondents identified food and agriculture, circularity and innovative materials, and healthcare as top priorities.

However, challenges remain.

About 22 percent cited high-quality deal flow with suitable exit options as their biggest obstacle, while 16 percent struggled to find like-minded peers for co-investments. Concerns around due diligence, greenwashing, and profitability were also highlighted as areas of focus.