Companies and financial institutions are taking the lead on sustainability. The journey to this point has been a long one as initially the rise of environmental issues was seen as a bit of threat. As a defence to this perceived threat it was no surprise to see the somewhat more vulnerable companies adopting the sustainable language early. You may recall the likes of Shell being one of the first to talk about the triple bottom line (people, planet, and profit) and BP aiming to go “beyond petroleum”. Over time forward thinking companies (Unilever and Ikea as examples) realised they could save money through better environmental management and boost their external credentials at the same time.
Following on from the introductory post on sustainable investing dated 18th December I thought I would tackle head on some preconceptions that stop investors accessing the capital markets with a value based approach. The pushback often heard when broaching the subject of sustainable investing is, “Yes, in theory the idea is attractive but I don’t want to give up return.” The notion that voting for the good guys with your capital will disadvantage you is entrenched – but is it right?
I imagine most readers would agree that human beings are not the best custodians of their planet. Food and water shortages lie uncomfortably alongside rampant population growth, the rich get richer and the poverty stricken multiply, biodiversity diminishes and the rush towards the nirvana of developed world status means that climate change has moved from a scientific discussion point to a horrifying reality.