Ninety-three per cent of global institutional investors actively consider ESG and sustainability in their real assets investment decisions, according to new research from Aviva Investors.

Seventeen per cent consider it a critical factor.

The findings are included in the fifth annual ‘Real Assets Study’ from Aviva Investors. They canvassed views from 500 institutional investors worldwide, including pension funds, insurers, global financial institutions and official institutions. Together, these represent more than $3.5 trillion in assets.

The study also revealed that:

  • Of institutional investors, 64 per cent plan to increase their allocations to real assets over the next two years. 46 per cent plan to do so by up to 10 per cent;
  • The highest allocations are by investors in North America, where almost a quarter have greater than 20 per cent of their portfolio in real assets;
  • Some 28 per cent of respondents allocate to real assets to capture its positive ESG impacts; and 
  • There was 53 per cent of respondents allocate to real assets for their ability to provide inflation-linked income.

Furthermore, while diversification remains the primary driver for investing in real assets, the ability to provide inflation-linked income is increasingly driving allocations, according to 57 per cent of respondents.