Sustainable Bottom Line: Inaugural survey of FAs worldwide shows strong interest in private markets while ESG ranked as least important to their private wealth clients.
Sources: Adams Street Partners, LLC and Sustainable Research and Analysis LLC.
Observations:
• An inaugural survey of financial advisers (FAs) worldwide conducted by Adam Street Partners*, a Chicago-based global private markets investment firm that manages over $62 billion in assets, found that the private wealth clients of financial advisors prioritize returns. More than 100 financial advisors were surveyed over six weeks into 2025 for their views on a variety of topics that were a cause for optimism or concern. Participants included wealth managers located in the US, Europe, and APAC.
• In order of preferences, financial advisors who responded to the survey indicated that the top investment priorities of their private wealth clients are accessing new investment opportunities (42%), wealth preservation (40%), income (37%), and tax efficiency (37%). According to the survey, financial advisors ranked ESG investing as least important to their clients among listed priorities, at 17%. Since this is the inaugural survey of financial advisors, comparative data is not available, still, a relatively low level of importance may reflect a dampening over the last two years or so in the level of priority assigned to ESG.
• Private markets investing, which refers to investments made in companies, assets, or projects that are not traded on public stock or bond exchanges, such as private equity, private credit, real estate, infrastructure projects as well as private funds and co-investments, figure prominently in the survey’s findings. Two-thirds (67%) of financial advisors expect the percentage of their clients invested in private markets to increase over the next three years, with nearly 7% predicting that the percentage of clients with alternative holdings will increase by more than 20%. This reflects a growing familiarity and deeper engagement with alternative strategies. More than 65% of FAs stated that at least 10% of their clients currently have private market investments. At the same time, 69% of advisors say the complexity of private markets makes it difficult to communicate effectively with clients. Less than half (49%) rate their own expertise as “advanced”—while client understanding trails, with just 32% of advisors reporting that their clients have “advanced knowledge.”
• Complexity, regulations, limited offerings, limited access, and tax reporting preferences have historically limited private market participation to accredited investors as well as retail investors who managed to gain exposure to private markets through closed-end funds, interval funds and non-traded REITS, for example. Yet, advisors report meaningful progress in addressing those barriers. Structures such as semi-liquid evergreen funds and digital platforms, along with an increasingly favorable regulatory environment, are expanding the reach of private investments. In this connection, a growing number of private market digital crowdfunding platforms have been springing up. These platforms, an estimated over 100 in number, are allowing investors to identify and integrate into existing portfolios small, limited private/direct/local (PDL) investment opportunities. These private market digital platforms also permit sustainable investors to identify and integrate into their portfolios impact-oriented PDLs. In either case, conducting proper due diligence at this time on such investment opportunities is challenging.
• In recent months, the Investment Company Institute, the leading trade association representing regulated investment funds in the United States and, in recent years, globally, announced that one of its strategic priorities is to give retail investors real access to private markets; and in prepared remarks for an event in Washington DC less than two weeks ago, SEC Chairman Paul Atkins said that the regulatory agency’s goal is to start opening up private fund markets to more investors. At around the same time, Empower, the large 401k service provider, announced that it will start allowing private credit, equity and real estate in some of the accounts it administers later this year. The firm indicated that it has joined with seven firms to offer these investments, including Apollo Global Management and Partners Group.
*The Rise of Private Wealth in Private Markets (https://advisoroutlook.adamsstreetpartners.com/wp-content/uploads/Adams-Street-Partners-2025-Advisor-Outlook-P2.pdf).
