Sustainableinvesting is helping to change environmentally harmful businesspractices. A new breed of investors is profiting from green whilebenefiting the planet. There are several established financialinstruments for green investments including stocks, bonds, funds,savings accounts, deposit certificates and money market accounts. Allof these types of investments can help the planet and turn a handsomeprofit.
In preceeding articles, The Green Market providedpractical demonstrations of the sizable profits available to investorsin green stock. In this article I address the benefits such investingoffers the earth.
Green investing is a subset of sociallyresponsible investing or ethical investing. While green investingfocuses on environmentally active businesses, socially responsibleinvesting is concerned with the environment and human welfare.
Greeninvesting decisions are based on criteria that actively improve thehealth of the planet. Green investing raises and channels capital intothose industries and companies which develop and introduce greentechnology and demonstrate environmental sensitivity through theirbusiness practices.
Green investing not only channels funds togreen businesses, it siphons capital away from dirty industries. Byinvesting in green sectors instead of environmentally destructiveindustries, investors are funding eco-innovation and stimulating thegrowth and development of sustainable companies.
Those investorswho chose to ignore the irrefutable evidence on climate change will bepunished in the marketplace when the value of high carbon portfolioscollapses. The growing costs of global warming will cause high carbonassets to plummet in the foreseeable future.
We are on a growinga carbon bubble, the longer it grows the more destructive itsinevitable collapse. However, we cannot afford to wait for the carbonmarket to implode. Part of the present day problem we face is the factthat the owners of carbon assets have a vested interest in defendingthem. Their economic and political resistance to climate changesolutions imperil the planet and its inhabitants.
Sustainableinvesting asks investors to engage a long term vision, but responsibleinvestors must be joined by responsible governments. To expedite theneeded change, governments must put a price on carbon throughlegislative and/or regulatory efforts.
Investors who are notmotivated by social interest should still value the significant returnsbeing offered by sustainable stock and governments who are not amenableto environmental concerns should be motivated by an increasinglyinformed electorates.
As illustrated by the performance of TheGreen Market’s sustainable stock, these investments can provide greatreturns, but investments in sustainable stock also stimulate the growthof a low carbon economy.