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Growing appetite for green investment in low-income countries

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Low-income countries are working to improve sustainability and build resilience to climate change, but more investment in needed, the Institute for Environment and Development (IED) has said.

Nanki Kaur, senior researcher at the IED said that there was a growing appetite for sustainable investment in these areas but a finance gap remained in many countries. Kaur’s comments follow a conference in Ethiopia, which discussed how low-income countries were transitioning to a cleaner economy.

Writing for Responding to Climate Change, Kaur said, “The challenge for developing nations is that the costs of making the transition to climate resilient green economies will be huge, and the actions needed come with very specific financing needs.

“On one hand, green economy initiatives have the potential to bring returns on capital investments and so can attract private investment. On the other hand, climate resilience is often a public good, and would ordinarily need public finance in the form of grants.”

Despite the fact investors poured an estimated $359 billion (£216 billion) into low-carbon and climate-resilient projects in 2012, Kaur identified three finance gaps.

The first is that the sum invested is only a small percentage of what is needed to tackle the global issue. This gap is described as especially “worrisome” for developing nations. For instance, at the conference, Rwanda estimated it faced a financing gap of $100m (£60m) per year over the next 20 years.

Secondly, private investment continues to “dominate” climate finance but often stays in developed countries because of the associated risks of placing money in a developing nation.

Finally, Kaur says 94% of the money invested in 2011 targeted mitigation – primarily renewable energy and energy efficiency. As many developing counties already have low-carbon emissions they instead need to prioritise adaption.

Despite the challenges they face, the conference highlighted that low-income economies are taking action to attract and mange both public and private investment for their climate change efforts. They are recognising the role of intermediaries, such as development banks, in mobilising finance; they are targeting different investors to suit the specific investment needs of climate resilience; and policymakers are focusing on financial planning systems.

Kaur wrote, “These evolving trends in the design of intermediaries, economic and financial instruments and financial planning systems show how many developing nations are taking important steps to ensure they are ready to receive, manage and disburse climate finance from both public and private sources as they make the transition to climate-resilient green economies.

“They are not just sitting waiting for money to flow. They are setting up the systems and institution that will create new money from old.”

Photo: oledoe via Flickr

Further reading:

Private investment in sustainable economy set to reach $10tn by 2020

Building a sustainable global economy

IPCC findings demand investment in a sustainable future, say investors

‘Dithering’ on green economy could costs UK billions, warns TUC

Bloomberg: clean energy investment decline is ‘worrying’

Environment

These 5 Green Office Mistakes Are Costing You Money

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eco-friendly green offices
Shutterstock Licensed Photo - By Stokkete | https://www.shutterstock.com/g/cyano

The sudden interest in green business is very encouraging. According to recent reports, 42% of all companies have rated sustainability as an important element of their business. Unfortunately, the focus on sustainability will only last if companies can find ways to use it to boost their ROI.

Many businesses get so caught up in being socially conscious that they hope the financial aspect of it takes care of itself. The good news is that there are plenty of ways to go green and boost your net income at the same time.

Here are some important mistakes that you will want to avoid.

Only implementing sustainability on micro-scale

The biggest reason that brands are going green is to improve their optics with their customers. Too many businesses are making very minor changes, such as processing paperwork online and calling themselves green.

Customers have become wary of these types of companies. If you want to earn their business, you are going to need to go all the way. Bring in a green business consultant and make every feasible change to demonstrate that you are a green organization from top to bottom.

Not prioritizing investments by long-term ROI

It isn’t realistic to build an entirely green organization overnight. You will need to allocate your capital wisely.

Before investing in any green assets or services, you should always conduct a long-term cost benefit analysis. The initial investment for some green services may be over $20,000. If they don’t shave your cost by at least $3,000 a year, they probably aren’t worth the investment.

Determine which green investments will have the best pay off over the next 10 years. Make these investments before anything else. Then compare your options within each of those categories.

Implementing green changes without a plan

Effective, long-term planning is the key to business success. This principle needs to be applied to green organizations as well.

Before implementing a green strategy, you must answer the following questions:

  • How will I communicate my green business philosophy to my customers?
  • How will running a green business affect my revenue stream?
  • How will adopting green business strategies change my monthly expenses? Will they increase or decrease them?
  • How will my company finance green upgrades and other investments?

The biggest mistake that too many green businesses make is being overly optimistic with these forecasts. Take the time to collect objective data and make your decisions accordingly. This will help you run a much more profitable green business.

Not considering the benefits of green printing

Too many companies believe that going paperless is the only way to run a green organization. Unfortunately, going 100% paperless it’s not feasible for most companies.

Rather than aim for an unrealistic goal, consider the option of using a more environmentally friendly printer. It won’t be perfect, but it will be better than the alternative.

According to experts from Doranix, environmental printers have several benefits:

  • They can process paper that has been completely recycled.
  • They consume less energy than traditional printers.
  • They use ink that is more environmentally friendly.

You want to take a look at different green printers and compare them. You’ll find that some will meet your needs as a green business.

Poorly communicating your green business strategy to customers

Brand positioning doesn’t happen on its own. If you want to run a successful green business, you must communicate your message to customers as clearly as possible. You must also avoid the appearance that you are patronizing them.

The best approach is to be clear when you were first making the change. I’ll make an announcement about your company‘s commitment to sustainability.

You also want to reinforce this message overtime by using green labels on all of your products. You don’t have to be blatant with your messaging at this stage. Simply provide a small, daily reminder on your products and invoices.

Finally, it is a good idea to participate in green business seminars and other events. If your community has a local Green Chamber of Commerce, you should consider joining as well.

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Energy

Responsible Energy Investments Could Solve Retirement Funding Crisis

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Energy Investments
Shutterstock / By Sergey Nivens | https://www.shutterstock.com/g/nivens

Retiring baby-boomers are facing a retirement cliff, at the same time as mother nature unleashes her fury with devastating storms tied to the impact of global warming. There could be a unique solution to the challenges associated with climate change – investments in clean energy from retirement funds.

Financial savings play a very important role in everyone’s life and one must start planning for it as soon as possible. It’s shocking how quickly seniors can burn through their nest egg – leaving many wondering, “How long your retirement savings will last?

Let’s take a closer look at how seniors can take baby steps on the path to retiring with dignity, while helping to clean up our environment.

Tip #1: Focus & Determination

Like in other work, it is very important to focus and be determined. If retirement is around the corner, then make sure to start putting some money away for retirement. No one can ever achieve anything without dedication and focus – whether it’s saving the planet, or saving for retirement.

Tip #2: Minimize Spending

One of the most important things that you need to do is to minimize your expenditures. Reducing consumption is good for the planet too!

Tip #3: Visualize Your Goal

You can achieve more if you have a clearly defined goal in life. This about how your money can be used to better the planet – imagine cleaner air, water and a healthier environment to leave to your grandchildren.

Investing in Clean Energy

One of the hottest and most popular industries for investment today is the energy market – the trading of energy commodities. Clean energy commodities are traded alongside dirty energy supplies. You might be surprised to learn that clean energy is becoming much more competitive.

With green biz becoming more popular, it is quickly becoming a powerful tool for diversified retirement investing.

The Future of Green Biz

As far as the future is concerned, energy businesses are going to continue getting bigger and better. There are many leading energy companies in the market that already have very high stock prices, yet people are continuing to investing in them.

Green initiatives are impacting every industry. Go Green campaigns are a PR staple of every modern brand. For the energy-sector in the US, solar energy investments are considered to be the most accessible form of clean energy investment. Though investing in any energy business comes with some risks, the demand for energy isn’t going anywhere.

In conclusion, if you want to start saving for your retirement, then clean energy stocks and commodity trading are some of the best options for wallets and the planet. Investing in clean energy products, like solar power, is a more long-term investment. It’s quite stable and comes with a significant profit margin. And it’s amazing for the planet!

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