Through a series of open letters, we aim to reach out to governments, political agencies, civil societies, investors, communities and to business leaders. This is a universal request and call for action to be a part of the change we all seek in the world currently.
This letter elaborates upon 2 strategies for directing investments towards sustainable development while ensuring desired financial returns.
Dear Investor,
We, at OneBarrow, admire the economic development that is facilitated due to your financial contribution to the global economy.
As the world experiences changes and challenges that are increasingly complex, we require solutions that come from a diverse range of stakeholders. Governments and private enterprises recognize capital availability as a major need for solving big and small problems. The good news is that if sustainable businesses are the positive force that can avoid environmental devastation, you and your investments are the prime drivers of sustainable ventures. This letter elaborates upon 2 strategies for directing your investments towards sustainable development while ensuring desired financial returns.
- Invest with the intention to generate measurable environmental and social impact
As an investor, knowing the social impact that your investments generate is the first step in a positive direction. When investing in a new venture, ask businesses to pitch the impact performance that their operations will have. This impact estimate can be based on the Environmental, Social and Corporate Governance (ESG) criteria which allows you to clearly identify the areas of sustainable growth your investment will flow into.
Additionally, the consumption preferences of millennials are moving towards engaging with businesses that consider environmental and social interests as part of their operation. As per Harvard Business Review, companies that were publicly perceived as behaving more responsibly had less-negative stock returns than their competitors in 2020. Corporations with strong ESG credentials are thus able to manage unexpected economic downturns better. Hopping onto the growing sector of impact investing can yield lucrative returns, as the ‘Global Impact Investing Network’ determined that more than 88% of impact investors reported that their investments met or exceeded their expectations.
2. Integrate investments with a personal vision
Sustainable investing is a key strategy for you to stay true to a personal vision or values while keeping returns as a priority. Your vision can pertain to driving a specific kind of social change, furthering a sustainable cause or even pushing for inclusive corporate governance practices. Determine an industry area for investment that aligns best with your values. Impact investors have taken an interest in sectors including access to clean water and food, agricultural growth, healthcare, clean energy and quality education, among others. Investment in similar areas allows you to become a partner in the movement for sustainable economic growth.
As responsible drivers of big and small businesses, your ability to finance ingenious sustainable businesses can make the foundation of the future more sustainable and just.
Yours sincerely,
OneBarrow
Riya Shankar Sharma
Content Writer, OneBarrow
