id you know that in 2014, there was over $21 trillion (T) in global sustainability assets under management worldwide? The amount of these investments has increased rapidly and now surpasses the debt levels of the United States! Moreover, were you aware that $1 out of every $6 invested in the U.S. during 2014 was placed in sustainable investment strategies? These expenditures now total $6.57T according to the Forum for Sustainable and Responsible Investment. Also, these tracked investments were 75% greater than in 2012 which totaled $3.74T. The growth of sustainable investing is being driven by the increasing demand for organizations to address environmental, social, and governance (ESG) criteria, as well as the overall desire for improved sustainability performance by shareholders and stakeholders alike. Today investors are also looking to divest specific assets because of sub-par performance. Additionally, investors are shifting to sustainable investment strategies to generate tangible value and growth. The track record of sustainable investing now substantiates their belief!
For U.S. sustainable investing, the general overall breakdown is:
It should be noted that this breakdown does include some overlapping assets. What then are some of the sustainable investing strategies that management can take, as well as individuals?
When making investment decisions based on a company’s or organization’s sustainability performance, the major reasons include long-term value creation, increased revenue, improved operational performance, effective management, compliance, community engagement, and reduced risk. Today the sustainable investment options are numerous and attractive. The difficulty may be in which one to choose.
I wish you the best on your sustainability journey!