Coronavirus Has Shown That Social-Impact Investing Is Here to Stay – Middle Market Growth

Written by Alex Sauter

It’s hard to say definitively which companies are going to do well during the coronavirus pandemic. But those that do good are set to emerge stronger.

The COVID-19 shock will likely be seen as a turning point for investment in B Corps, companies that have opted to be legally bound to consider the impact of their business on employees, customers, suppliers, community and the environment.

Having emerged relatively recently, some market observers expected that in a downturn investors would dump socially conscious companies, viewing them as a nice-to-have but less reliable asset than traditional companies. I know several very smart financial professionals who expected it to be the same story this time.

They were wrong. In the first four months of the year, investors poured a record $12 billion into funds that invest in environmental, social and governance (ESG) practices, according to Morningstar Direct. And more than 70% of U.S. ESG funds across all asset classes performed better than their counterparts.

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By Jessica Yap-Chung
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