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One day soon, we hope all investment will be sustainable, responsible and ethical – before it is too late

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Whatever you call it – sustainable investment, responsible investment or ethical investment – the challenge for 2014 is not how to make niche funds mainstream, but how to make mainstream funds sustainable, responsible and ethical.

Financial trade outstrips all other trade 26:1. More than any other human activity, what we invest in shapes the world we live in. Financial centres determine the price of everything from your morning coffee to what you need to have accumulated in assets to afford a comfortable retirement. Supposedly sovereign countries are all provincial regions of the United States of Capital.

A significant portion of financial trade does not even have human oversight, as high speed trading attempts to gain advantage faster than we can conceivably compute. The effect on individuals, communities, countries and the environment have no influence on, or stake in, this automated trading. Profit maximisation is the only priority.

Specialist sustainable and ethical funds do a lot of the heavy lifting in providing capital for ventures addressing global issues – of between £9-22 billion depending on how you define the market. That’s between 1.2% and 2.9% of funds under management in the UK (£763 billion). To effect the required change globally we need between 10% and 30% to be invested sustainably. That’s £76-229 billion. It feels like an impossible goal.

Companies that are providing clean energy, clean water, clean industry alongside sustainable, resource-light supply chains, agriculture, forestry and fishing need investment. Social investment domestically and impact investment overseas can lift communities from depending on aid or charity to be self-sustaining. They all need investment, over charity.

This means building the hard-nosed economic case for sustainable investment for institutional investors. It means encouraging pension funds and sovereign wealth funds to commit to investment that is in the long-term interest of their pension contributors and citizens. And that includes the interests of society as a whole and the environment, as well as simply profit.

It means breaking down adviser and other intermediary resistance to discussing the sector and dispelling pervasive myths about fund performance and investor disinterest. It means reassuring private investors that sustainable investment doesn’t carry more risk, but significantly less. Climate change, overpopulation, resource scarcity and unfettered pollution are real and threaten all of us, regardless of wealth, age, gender or nationality. Arbitrary lines drawn on a map are no protection against global issues.

It means creating a regulatory environment nationally and globally that makes sustainable investment strategies the rule, rather than the exception. It means making the principles, processes and best-of-breed guidance of sector bodies such as the UN-backed Principles for Responsible Investment (PRI), the European Sustainable Investment Forum (Eurosif) and the UK Sustainable Investment and Finance Association (UKSIF) standard industry practice and adhered to. Naming and shaming those who transgress might be uncomfortable for some, but these standards cannot simply be a tick-box, public relations or greenwash exercise.

Transparency on investment strategies, all holdings, portfolio turnover, company engagement and charging structures will help clear up the opaqueness of the industry and increase investor trust. No one is perfect, but functioning markets need more equality of power between investors and investees so they can make informed choices.

The accumulation of wealth for wealth’s sake is shallow and meaningless. You cannot spend it when you are dead, and there can be nothing more shortsighted, unethical and selfish as investing in a way that reduces the life chances of future generations.

Measuring success solely on a financial scale recognises everything except that which really matters. We need investment that means prosperity for the many, not just for the few. We need investment that means we pass on a viable environment to future generations rather than degrade it. We need investment that protects and values humans, rather than exploits them.

This is not some romantic, idealistic view of what the future can be, but the commonly held view that we should be capitalism’s master, not its slave – or worse, its apologist or devotee. It has done more than any other economic system yet tested to create prosperity, but the cost has been far too high so far.

We hope that one day soon, all investment is sustainable, responsible and ethical. Unsustainable, irresponsible and unethical investment is humanity’s long defeat; its suicide note for future generations.

Join other enlightened investors and build a blue and green tomorrow, and walk away from the cold and timid souls who only ever see the virtues of wealth creation at any cost.

Further reading:

From ethics to sustainability: shifting the investment debate for 2014

The sustainable investment tipping point is now

‘There are no moral or ethical considerations when investing’

Ethical investment: better a diamond with a flaw, than a pebble without

The Guide to Sustainable Investment 2013

Simon Leadbetter is the founder and publisher of Blue & Green Tomorrow. He has held senior roles at Northcliffe, The Daily Telegraph, Santander, Barclaycard, AXA, Prudential and Fidelity. In 2004, he founded a marketing agency that worked amongst others with The Guardian, Vodafone, E.On and Liverpool Victoria. He sold this agency in 2006 and as Chief Marketing Officer for two VC-backed start-ups launched the online platform Cleantech Intelligence (which underpinned the The Guardian’s Cleantech 100) and StrategyEye Cleantech. Most recently, he was Marketing Director of Emap, the UK’s largest B2B publisher, and the founder of Blue & Green Communications Limited.

Economy

A Good Look At How Homes Will Become More Energy Efficient Soon

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energy efficient homes

Everyone always talks about ways they can save energy at home, but the tactics are old school. They’re only tweaking the way they do things at the moment. Sealing holes in your home isn’t exactly the next scientific breakthrough we’ve been waiting for.

There is some good news because technology is progressing quickly. Some tactics might not be brand new, but they’re becoming more popular. Here are a few things you should expect to see in homes all around the country within a few years.

1. The Rise Of Smart Windows

When you look at a window right now it’s just a pane of glass. In the future they’ll be controlled by microprocessors and sensors. They’ll change depending on the specific weather conditions directly outside.

If the sun disappears the shade will automatically adjust to let in more light. The exact opposite will happen when it’s sunny. These energy efficient windows will save everyone a huge amount of money.

2. A Better Way To Cool Roofs

If you wanted to cool a roof down today you would coat it with a material full of specialized pigments. This would allow roofs to deflect the sun and they’d absorb less heat in the process too.

Soon we’ll see the same thing being done, but it will be four times more effective. Roofs will never get too hot again. Anyone with a large roof is going to see a sharp decrease in their energy bills.

3. Low-E Windows Taking Over

It’s a mystery why these aren’t already extremely popular, but things are starting to change. Read low-E window replacement reviews and you’ll see everyone loves them because they’re extremely effective.

They’ll keep heat outside in summer or inside in winter. People don’t even have to buy new windows to enjoy the technology. All they’ll need is a low-E film to place over their current ones.

4. Magnets Will Cool Fridges

Refrigerators haven’t changed much in a very long time. They’re still using a vapor compression process that wastes energy while harming the environment. It won’t be long until they’ll be cooled using magnets instead.

The magnetocaloric effect is going to revolutionize cold food storage. The fluid these fridges are going to use will be water-based, which means the environment can rest easy and energy bills will drop.

5. Improving Our Current LEDs

Everyone who spent a lot of money on energy must have been very happy when LEDs became mainstream. Incandescent light bulbs belong in museums today because the new tech cut costs by up to 85 percent.

That doesn’t mean someone isn’t always trying to improve on an already great invention. The amount of lumens LEDs produce per watt isn’t great, but we’ve already found a way to increase it by 25 percent.

Maybe Homes Will Look Different Too

Do you think we’ll come up with new styles of homes that will take off? Surely it’s not out of the question. Everything inside homes seems to be changing for the better with each passing year. It’s going to continue doing so thanks to amazing inventors.

ShutterStock – Stock photo ID: 613912244

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Economy

IEMA Urge Government’s Industrial Strategy Skills Overhaul To Adopt A “Long View Approach”

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IEMA, in response to the launch of the Government’s Industrial Strategy Green Paper, have welcomed the focus on technical skills and education to boost “competence and capability” of tomorrow’s workforce.

Policy experts at the world’s leading professional association of Environment and Sustainability professionals has today welcomed Prime Minister Teresa May’s confirmation that an overhaul of technical education and skills will form a central part of the Plan for Britain – but warns the strategy must be one for the long term.

Martin Baxter, Chief Policy Advisor at IEMA said this morning that the approach and predicted investment in building a stronger technical skills portfolio to boost the UK’s productivity and economic resilience is positive, and presents an opportunity to drive the UK’s skills profile and commitment to sustainability outside of the EU.

Commenting on the launch of the Government’s Industrial Strategy Green Paper, Baxter said today:

“Government must use the Industrial Strategy as an opportunity to accelerate the UK’s transition to a low-carbon, resource efficient economy – one that is flexible and agile and which gives a progressive outlook for the UK’s future outside the EU.

We welcome the focus on skills and education, as it is vital that tomorrow’s workforce has the competence and capability to innovate and compete globally in high-value manufacturing and leading technology.

There is a real opportunity with the Industrial Strategy, and forthcoming 25 year Environment Plan and Carbon Emissions Reduction Plan, to set long-term economic and environmental outcomes which set the conditions to unlock investment, enhance natural capital and provide employment and export opportunities for UK business.

We will ensure that the Environment and Sustainability profession makes a positive contribution in responding to the Green Paper.”

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