Chris McKnett, brilliantly illustrates the ability of investment choices to create social and environmental change. He stresses that sustainable investing is less complicated than you think, better performing than you believe, and more important than you can imagine.
Environmental, Social and Governance (ESG) initiatives are gaining momentum, with 80% of global CEO’s identifying sustainability as the root to growth & innovation, leading to competitive advantage, and limiting future risk. ESG is not about making money and giving the profits to charities – it’s fully integrating sustainability into all business practices.
Large institutional investors have the financial firepower to create massive change… and they are:
CalPERs is the pension fund for public employees in California, with assets of $244 Billion, it is the second largest in the US, sixth largest in the world. They are moving to 100% sustainable investment, by systematically integrated ESG across the entire fund. Why? They believe it’s critical to superior long term returns. FULL STOP. In their own words ‘Long term value creation requires the effective management of three forms of capital: Financial, Human, and Physical’
Prudent investing and finance theory are not subordinate to sustainability, they are compatible.
Does your pension or retirement savings plan consider sustainability and/or ESG when making investment decisions? Do you consider not only the return on investments, but what your money is helping to grow? Make intentional investment decisions to create the world you want to see.
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You may also enjoy this Q&A interview with Impact Investor, William Doll.