The need to change the world positively is the top motivator for impact investing by ultra-high net worth individuals, according to a report, outdoing financial reasons.

The primary motivation for the ultra-rich to engage in impact investing is «the responsibility to make the world a better place», according to a report produced by Campden Wealth on behalf of Global Impact Solutions Today (GIST) and Barclays Private Bank, as agreed by 77 percent of respondents.

Climate change was a leading cause of interest with 84 percent believing their private capital will be essential in addressing the matter. 

Almost 60 percent said they would like their family portfolios to be aligned with the 2-degree Celsius scenario of the Paris Agreement, at the minimum. 61 percent also said they would be willing to sacrifice some financial returns to prevent a breakdown of the climate.

Intergenerational Unity

The second leading reason (53 percent) is the belief that sustainable investing is creating «a bridge between the older and younger generations». While 68 percent agree that the younger generations are taking the lead on impact investing, 69 percent report that the concept is being embraced by the generation in charge of family wealth. 

And there are benefits beyond just improved unity with 60 percent agreeing – including 44 percent that strongly agree – that involving the next generation in sustainable investing will prepare them to take on greater family responsibility.

Improved Performance

At 39 percent, the third leading reason for families to invest sustainably is to generate better returns and reduce risk. 80 percent believe that returns do not always have to be sacrificed to invest in impact with 29 percent believing there is no trade-off at all.

In the coming five years, 37 percent of respondents expect outperformance and 44 percent expect the same performance, relative to traditional investments. 

The report is based on data from nearly 150 respondents from 35 countries with an average of $730 million in assets under management.