Overview

Sustainable Signals: Institutional Investors is a research series published by the Morgan Stanley Institute for Sustainable Investing. This report represents the fourth edition of combined survey data collected from institutional investors across the globe. It specifically examines the views of 900 institutional investors, comprised of 600 asset owners and 300 asset managers, located across North America, Europe, and the Asia-Pacific region. The report provides a comprehensive assessment of the current state of sustainable investing, tracking shifts in asset allocations, risk management strategies, and thematic priorities. By comparing data from previous years, the series highlights evolving trends in how large-scale investors integrate environmental, social, and governance considerations into their investment frameworks.

Purpose

The primary purpose of the Sustainable Signals series is to identify and track global market trends within the sustainable investing landscape. It is designed to provide actionable insights for institutional investors, helping them to understand the shifting motivations and challenges faced by their peers. The report serves to inform strategic decision-making regarding asset allocations by highlighting the perceived materiality of sustainability-related risks and the emergence of new growth opportunities. It also aims to clarify the role of sustainability in risk management and to explore the adoption of specific themes, such as climate adaptation and responsible artificial intelligence, within investment portfolios. By providing a clear snapshot of the institutional market, the report helps firms align their strategies with broader industry movements and regulatory developments.

Methodology

The findings in this report are based on an online survey conducted by iResearch on behalf of the Morgan Stanley Institute for Sustainable Investing. The survey was carried out between 24 August and 1 October 2026. To qualify for participation, respondents were required to self-identify as asset managers or asset owners and confirm that their organisations currently practise or plan to practise sustainable investing. The sample of 900 respondents was distributed evenly across North America, Europe, and the Asia-Pacific, with 300 participants per region. For asset owners, quotas were set based on investable asset size, and for asset managers, based on total assets under management. The 2026 survey methodology utilised sample matching across two vendors to ensure direct comparability with the 2024 and 2025 editions of the report. Sustainable investing is defined within the study as the practise of making investments that aim to achieve market-rate financial returns while considering positive social or environmental outcomes. The analysis covers both investment approaches, such as ESG integration and thematic investing, and engagement approaches, such as shareholder interactions and policy advocacy.

Use for finance professionals

Finance professionals can utilise this report as a benchmark to compare their own firm’s sustainable investing practises against global and regional peers. The data on expected asset allocations provides a forward-looking view of capital flows, allowing professionals to anticipate market shifts and identify areas of increasing investor interest. Insights into risk management, particularly the rising focus on the physical impacts of climate change and the difficulty of assessing these risks, can assist portfolio managers in refining their risk assessment models and data procurement strategies. The report’s exploration of thematic priorities, such as the integration of responsible AI and the prioritisation of climate adaptation over mitigation, offers guidance for product development and thematic research. Furthermore, the detailed analysis of shareholder engagement strategies and the use of bespoke mandates versus pooled funds provides asset managers with valuable information on client expectations and the evolving requirements of asset owners. Professionals can also use the data on common concerns, such as data availability and regulatory requirements, to inform their internal compliance and engagement strategies.