Monday, January 25, 2010

Sustainable Stock Offers More than Extraordinary Returns

Sustainable investing is helping to change environmentally harmful business practices. A new breed of investors is profiting from green while benefiting the planet. There are several established financial instruments for green investments including stocks, bonds, funds, savings accounts, deposit certificates and money market accounts. All of these types of investments can help the planet and turn a handsome profit.

In preceding articles, The Green Market provided practical demonstrations of the sizable profits available to investors in green stock. In this article I address the benefits green investing offers the earth.

Green investing is a subset of socially responsible investing or ethical investing. While green investing focuses on environmentally active businesses, socially responsible investing is concerned with the environment and human welfare.

Green investing decisions are based on criteria that actively improve the health of the planet. Green investing raises and channels capital into those industries and companies which develop and introduce green technology and demonstrate environmental sensitivity through their business practices.

Green investing not only channels funds to green businesses, it siphons capital away from dirty industries. By investing in green sectors instead of environmentally destructive industries, investors are funding eco-innovation and stimulating the growth and development of sustainable companies.

Those investors who chose to ignore the irrefutable evidence on climate change will be punished in the marketplace when the value of high carbon portfolios collapses. The growing costs of global warming will cause high carbon assets to plummet in the foreseeable future.

We are on a growing carbon bubble, the longer it grows the more destructive its inevitable collapse. However, we cannot afford to wait for the carbon market to implode. Part of the present day problem we face is the fact that the owners of carbon assets have a vested interest in defending them. Their economic and political resistance to climate change solutions imperil the planet and its inhabitants.

Sustainable investing asks investors to engage a long term vision, but responsible investors must be joined by responsible governments. To expedite the needed change, governments must put a price on carbon through legislative and/or regulatory efforts.

Investors who are not motivated by social interest should still value the significant returns being offered by sustainable stock and governments who are not amenable to environmental concerns should be motivated by an increasingly informed electorate.

As illustrated by the performance of The Green Market's sustainable stock, these investments can provide great returns, but investments in sustainable stock also stimulate the growth of a low carbon economy.
____________________________________________

Related Articles
The Green Market's 5 Sustainable Stock Portfolios
Sustainable Stock
Sustainable Investing and Long Term Thinking
Solar Stock Review and Future Prospects
Wind Stock Review and Future Prospects
Geothermal Stock Review and Future Prospects
Energy Efficient (Smart) Grid Stock Review and Future Prospects
Energy Efficient Lighting Stock Review and Future Prospects
Green Bubble?

No comments: