Responsible investment terms: what is green investment?

Green investment supports companies that provide and sustain environmentally-friendly practices and products, so when you make a green investment, you act with both your principles and your pocket in mind.

An awareness of the environmental impacts of industrial activities has become more widespread, with many consumers switching their services over to companies that don’t harm the environment and its ecological services.

Green investment is growing. Blue & Green Tomorrow ran a poll throughout February and found that 71% of readers said they would consider the ethical, sustainable and responsible options when investing. This shift is occurring all over the world, where investors want to transfer their money into funds and companies that minimise the negative environmental impacts and maximise the positive.

The green investment sector ranges from developing renewable energy resources, tackling resource scarcity and tackling deforestation. Investing in these sectors will support a transition from carbon-based energy to new clean technologies that offer more sustainable power.

In a piece for the Sierra Club, Garvin Jabusch, chief investment officer of Renewable Energy World, said, “The world is clamouring for solutions.

“The companies that provide them will by necessity grow faster than the companies representing the old, fossil-fuel-based economy.”

You could see it as supporting companies that mitigate environmental damage and pioneer sustainability practices, and will ultimately generate a long-term string of profits and benefits.

Green investment means greener job opportunities. When industries and companies look to sustainability, cleaner technologies and resource efficiency, doors open to a wide range of new job opportunities.

It also means a healthier environment. Establishing sustainable infrastructure and enhancing and protecting natural environments means creating attractive, prosperous, productive and healthy communities.

Green investment funds come in different shades, so it’s always sensible to explore your options before investing.

Blue & Green Tomorrow has profiled the Quadris Environmental Fund, a fund that solely invests in a sustainable Brazilian teak plantation, and the Legal & General Global Environmental Enterprises Fund, which looks to harvest the benefits of the ever-increasing need to adapt to climate change.

With increasing capital flowing into clean energy and green technology and sustainability challenges becoming ever-more urgent, green investment is needed to drive change.

To learn more about green investment and what options are available, download our new Guide to Sustainable Investment 2013 for free.

Further reading:

Why we can’t afford to lose ecosystem services

Cameron: UK can be a ‘global showcase for green innovation’

The Guide to Sustainable Investment 2013