RESPONSIBLE INVESTMENT IS AN EXCELLENT WAY TO MAKE A POSITIVE CONTRIBUTION IF YOU ARE PASSIONATE ABOUT THE ENVIRONMENT AND CLIMATE CHANGE.
In fact, preserving the natural environment and concerns about climate change are the most commonly cited reasons for people wanting to know their investments are working to improve the world for themselves and for future generations.
RI gives you the chance to do what the governments of the world continue to grapple with. It is a way to ensure your money is directed toward companies that are making a positive impact on the environment and on society and away from those that cause harm.
“As governments attempt to impose market-based and other initiatives to move to a low-carbon economy, it is expected that there will be financial winners and many financial losers.” Greg Liddell, Director, consulting and advisory services, Australasia, Russell Investments.
Whatever solutions governments finally agree to as the best ways to lessen the impacts of climate change, those solutions will have an impact on the profitability of companies all around the world.
Why? Because companies who emit carbon will now pay for their pollution levels, and those who are helping to reduce carbon, such as renewable energy and energy efficient companies, will be provided withattract financial benefits, competitive advantage, efficiency savings, reputational benefits and employee loyaltyand incentives.
Meanwhile the desire for environmental sustainability and a green future is now irrefutably mainstream. Savvy investors are already factoring the consequences of policies like carbon trading into their assessment of a company’s future value. And many of the world’s best business leading managers companies are already prepared for a low-carbon future.
“We think green means green. This is a time period where environmental improvement is going to lead toward profitability. This is not a hobby to make people feel good.” Jeffrey R. Immelt, Chairman and CEO, GE
“This used to be controversial, but the science is in and it is overwhelming……We believe every company has a responsibility to reduce greenhouse gases as quickly as it can.” Lee Scott, CEO, Wal-Mart.
By channelling your investment dollar towards funds and companies that have positive climate change and environmental management practices, you are directly encouraging positive corporate behaviour. Of course, climate change is not the only environmental challenge confronting us in the 21st century:
Water scarcity is a growing problem that affects governments, businesses and individuals in many parts of the world. The United Nations has forecast that by 2030 almost half of the world population will live in areas facing water stress or water scarcity and one fifth of the world’s population will not have access to adequate drinking water. Some companies whose productivity depends on access to significant water supplies (agriculture, food and beverage, electricity production, manufacturing) are already working to understand the exposure to risks associated with water scarcity.
According to WWF the natural resources used by humanity have increased to 125% of global carrying capacity and could rise to 170% by 2040. When human activity is combined with population growth and the rise of consumerism, it is clear that access to natural resources such as energy, timber, land, food and water will become critical to corporate productivity and investment decisions in the future.
RI IN ACTION!
Find out why Clare’s financial adviser suggests she uses positive screening so her investments can have a positive environmental and social impact.
WANT TO LEARN MORE?
Find out how responsible investment can hold companies accountable.
READY TO INVEST?
If you’re ready, start investing responsibly.
LOOKING FOR CERTIFIED RI PRODUCTS AND SERVICES?
Find organisations and advisers who have been certified by RIAA according to the strict disclosure practices required under the Responsible Investment Certification Program.
Simply click on the category below:
