As we pointed out in a recent post, cannabis activists used to be primarily concerned with the rights of consumers to consume recreational and medical marijuana. We have since realized that there are other great reasons to get behind cannabis regulation. The environmental benefits are among them. This means that ethical investors that are concerned about the environment are allocating more capital to cannabis stocks.
Scientific America recently pointed out some of the surprising environmental benefits of legalizing cannabis. One of the benefits is that it would reduce smuggling, which has had a detrimental effect on the environment. This is drawing more interest in cannabis products, stocks and private equity investing opportunities.
Why Cannabis Companies Are Attracting Eco-Investors
Eco-conscious investors are always looking to minimize their impact on the environment when choosing companies for investment. They look at a company’s operations to determine how much waste and pollution the company creates.
An ethical investor must consider the treatment of animals and conservation efforts of a company before deciding to invest. All companies use energy to produce their product, which results in waste products and pollution. Cannabis companies appeal to eco-conscious consumers because the product’s reputation meshes well with the idea of being environmentally aware. We can see cannabis companies changing how they think about retail packaging, production, and even retail spaces in regards to its impact on the environment.
Many cannabis companies are becoming aware of the environmental impact of packaging. Eco-conscious cannabis companies use recyclable and reusable packaging materials for distribution of their products. Leafly states that sustainable packaging has become the standard practice for many startups. For example, Sana Packaging offers a hemp-based plastic alternative for distributing pre-rolled flower products. The packaging is 100% biodegradable and childproof.
Sustainable cannabis packaging is typically made from hemp, which opens yet another industry to create products that don’t end up in our oceans. Hemp plants are in the cannabis family but have very little active cannabinoids. These plants are harvested for their fibrous nature as a rival to cotton rather than their flowers like traditional cannabis. Other companies have avoided regulations by developing their own locally manufactured packaging. Kind Courier in San Francisco offers child-resistant boxes for pre-rolls, vape cartridges, and raw flower. The service offers a full menu to their customers, with minimal retail packaging.
Changing the environmental impact of the industry goes beyond improving the end product the consumer receives. Some dispensaries and recreational stores have promoted sustainability through their own grow operations that are harvested for hyperlocal distribution. A few dispensaries in Colorado now produce their own clean cannabis in what’s known as the seed-to-sale model. This new method helps cannabis producers eliminate pesticides, fertilizers, and toxins that could potentially be present in the final product. Companies like Stem are using methods to create purer products and less environmental impact. Cannabis operations cannot be classified as organic due to the substance being illegal at the federal level, but growers and producers still operate by organic standards. Seed-to-sale solutions help retailers and consumers know exactly what they’re getting when they buy a product. The seed is assigned a barcode at germination so it can be followed at every stage of the growing, maturing and curing process.
Sustainable cannabis companies don’t have to be involved with the production of cannabis to make a difference. Some accessory makers are catering to consumers by offering products like glass tips for joints to reduce paper waste for cannabis smokers. These reusable tips can be washed and used again and again rather than producing a disposable product. Other accessory companies focus on making sustainable smoking products from glass and wood. These durable accessories only need to be purchased once, rather than disposable products like vape pens and plastic packaging from pre-rolls and concentrates.
Cannabis Companies Are Drawing More Attention from Ethical Investors
Ethical investors are starting to discover the profound benefits of cannabis. This is going to spur more people to invest capital in cannabis startups. They will likely take even more steps to bring eco-friendly products to the market in the near future.