Elections, the saying goes, have consequences. Typically, the consequences mean who gets appointed for important positions, or which legislation gets passed. But often enough, elections also have consequences for investments and investing strategy.

Several investment professionals have recently argued that the presidential election in November (and the Georgia runoff elections in January that gave the Democrats a technical majority in the Senate) has already affected the way that many wealthy Americans are pursuing their investments.

Jay Shah, president of the wealth management firm Personal Capital, says that in early 2020, investors were collectively requesting that about one of every five new dollars coming into his firm go into socially responsible portfolios. Around November, that ratio shifted to about one out of every four, and as the new year began, it has become one out of three. “There’s just a macro trend of people wanting to make a statement, people want to put their money behind their position,” Shah says.

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That’s a dramatic shift in a short period of time. The question is: Why is it happening?

Part of the increase is simply continuation of a trend that was well underway. According to one SRI trade group, the total U.S.-domiciled assets under management that uses sustainable investing strategies rose from $12 trillion at the start of 2018 to $17.1 trillion at the start of 2020. Tom Murray, vice president and head of EDF+Business at Environmental Defense Fund, says that he began noticing a particular uptick in investment into ESG mutual funds and ETFs at the beginning of 2020, and that the COVID pandemic and the racial justice movement last year created “a jet stream” that carried through to the election and beyond.

As for the increase in sustainable investing post-election, it’s possible that individual investors who vote Democratic were waiting for the election results before making commitments, and that group is more likely to favor ESG investment. A simpler explanation is that investors discern that the political and policy landscape has changed and are adjusting their portfolios toward greener, more sustainable companies than before. During Donald Trump’s single term, for example, many automobile manufacturers and related companies publicly or privately supported the administration’s rollback of fuel efficiency standards that Obama had put in place. Those policies, arguably, made polluting companies look like more attractive investments, and a similar dynamic was obtained with the president’s attacks on the Paris Climate Agreement.

Now, however, it seems very likely that the Biden administration will return to the Obama-era fuel efficiency standards, and one of Biden’s first actions as president was to recommit the United States to the Paris Agreement. Moreover, the Biden administration has committed itself to an ambitious climate plan, with fairly specific goals and timetables built in.

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Biden’s early actions send a strong signal that, for example, electric vehicles are going to be a much higher government priority than it has been for the last four years. Companies can read those signals; the post-election timing of General Motors’ announcement that it will eliminate fossil-fuel-powered vehicles by 2035 hardly seems coincidental.

Corporate commitment to renewable energy, in turn, is likely guiding investor behavior. “It’s a no-brainer,” says Julie Gorte, senior vice president for sustainable investing at Pax World Funds, one of America’s oldest socially responsible mutual funds. “What’s striking to me about the Biden climate plan is the significant allocation to science and technology research and development.”

This commitment, she predicts, will lead to dramatic growth in a few “silver bullet” technologies that will be necessary to meet the climate goals. These include cheap storage of electricity, “green hydrogen,” carbon capture and storage, and making land use more productive in order to preserve biodiversity.

It’s not merely investment in cutting-edge technology that will continue to fuel the ESG investment trend; it’s also increased pressure from corporate shareholders, stakeholders and employees. More than half of American adults believe that corporations should take action against climate change; it’s one of the rare issues on which there is not a huge difference between Democrats (66 percent) and Republicans (47 percent).

The Biden administration will also likely have a substantial impact on ESG investing through the regulatory sphere. Environmental and shareholder activists have long urged the Securities and Exchange Commission (SEC) to force public companies to disclose the risk that climate change poses to their future business. According to some estimates, more than 90 percent of U.S. equities by market capitalization are significantly affected by climate risk.

We’re also seeing an increase in the number of employer-provided 401(k)s that offer ESG options. There are approximately $6 trillion invested in employer-provided 401(k)s in the U.S., yet according to EDF’s Murray, fewer than five percent of 401(k) plans offer an ESG option. Increasingly, employees and employers seem likely to demand more ESG choices, and as those retirement funds shift, more ESG funds and products will come on the market.

Clearly, socially responsible investing has picked up since Biden’s election, and it sure looks like it’s here to stay.