Investments are not just about making yourself money but can also be used to make the world a better place.
ESG Investing is known as socially responsible investing or sustainable investing, and it entails investing in a way that favours Environment, Social and Governance (ESG) factors or outcomes.
These investments consider human wellbeing, sustainability, and the economy. And the ESG framework is widely used by UK banks to assist companies in challenging these issues.
The Organisation for Economic Co-operation and Development states there has been a growth in areas of sustainable finance, including ESG investing approaches.
It says shifts in demand throughout the finance ecosystem “driven by the search for better long-term financial value, and a pursuit of better alignment with values” is the reason for this increase.
This all works together to create a positive impact on the wider community and even the world.
Here are some points you can consider when thinking about where to invest your money.
Investors can ask what impact the work of a particular company has on the environment. For example, what is the company’s carbon footprint? Does it have a sustainable supply chain? Does its work involve any toxic chemicals? Also, what proactive measures does the business take to help the environment?
What are the companies hiring policies? Does it work to boost representation across different communities? What is it doing to ensure inclusion and diversity is celebrated? It is also helpful to consider what the business does to help the wider community.
What is the culture of the leadership? What is the company’s board doing to drive positive change?
Whatever type of investment you are looking to make, taking professional advice, and ensuring you understand the numerous options available to you is the first important step.
If you are looking to make an ESG investment, then contact our experts today.