Morgan Stanley Wealth Management on Monday armed its more than 15,600 reps with a tool to help investors align their portfolios with their
socially and environmentally conscious beliefs.
The Morgan Stanley Impact Quotient, colloquiallydubbed IQ, is the latest example of the financial services industry's
growing acceptance of and appreciation for impact or sustainable investing principles.
"We are seeing broad and deep interest in sustainable investing," said Matt Slovik, head of global sustainable finance at Morgan Stanley.
The IQ platform begins by letting clients build their own impact profile through a questionnaire that can be customized for the individual or adapted to include more general categories of
impact investing.
"Clients can select from over 100 impact objectives to build their impact profile, and it will reflect areas they want to positively impact as well as issues they may seek to avoid," said Lily Trager, director of investing with impact and head of impact solutions at Morgan Stanley.
Step two involves assessing the client's current portfolio to measure impact objectives against how the portfolio is allocated.
In the final step, the adviser identifies investment opportunities that combine long-term investment objectives with the client's impact investing objectives.
"It's a very personal process, but we've designed it to be easy to use," Ms. Trager said.
The platform is designed to be flexible, recognizing that certain investor preferences can change over time, she added.
While the platform is aimed at aligning clients' investments with their impact objectives, Ms. Trager said special emphasis is placed on the "intentionality" of the underlying investments.
"If a client wants to invest in funds that have a lower carbon footprint than the broader market, they may find that in a fund that is not labeled as an impact-investing fund," Ms. Trager said. "But as an adviser, you would want to make sure the fund has an intentional approach, so the day after the fund is purchased it doesn't start investing in something else."
There is no additional fee for applying the
IQ analysis, which is available to all 3.2 million clients working with Morgan Stanley reps.