From Guest Blogger Kimberly Grimms: Where Can Sustainable Investments Take You

As tremendous amount of intelligence and brains about “sustainability” picks up vapor, one’s framework can get lost in a myriad of terms, views, meanings and possibly, idea delusions.

World issues like – sustainability, resource scarcity, labor concerns, environmental costs, economy and finance and community development – are no longer singular and rare rather persistent and are considered growing challenges in a global scale.

The idea of urbanity then was put into a zero-sum issue. Urbanity represents the good, the bad and by the same token of equality about progress. Arguably, we cannot just cherry pick the progress while we forget the losses. Recently, adaptive measures have been put into account of the world’s blueprint in leading the future to sustainability – from sustainable living to sustainable cities, sustainable industries to sustainable investments.

We are all leading to the mentality; the future can only be sustainable, nothing else. After all, there is no Planet (B). Now, the question is, where can sustainable investments take us?

Billion Dollar Venture Problems

Global problems began a long time before technology came around. With or without China’s debt problems, the world has financial and economical problems. With or without renewable energy, we have energy troubles. With or without genetically-improved crops, we have food shortage. With or without hierarchical issues, we have politics. With or without climate change, we have environmental damages.

Necessity is the mother of all conventional ideas, inventions and green innovations. In this age, what bigger problem is there than sustaining a humble abode?

Zooming into the world energy demand and economic outlook, world energy consumption increases from 524 quadrillion Btu last 2010 to 630 quadrillion Btu in 2020 and an estimated 820 quadrillion Btu in 2040, a 56 percent increase in a span of 30 years. Moreover, according to the U.S. Energy Information Administration, an 85 percent of global energy demand increase occurs and will continue among the developing nations that are outside the Organization for Economic Cooperation and Development (non-OECD). These nations were strongly driven by expanding population and stronger economic foundations. These findings significantly show many economic and geopolitical circumstances add considerable uncertainty to any long term assessment of world energy market and economy.

The issue on world energy use leads to another and literally a billion dollar problem – monetary and capital crisis. In a study, World Economic Situation and Prospects released by United Nations, the world economy weakened considerably. A number of developed countries have fallen into a double-dip depression, including United States of America and Europe. Other countries facing sovereign debt distress have moved deeper into if not recession, near collapse.

As countries continue adapting to the needs and risks, points to the rapid and massive migrations to cities for an opportunity to live in skyscrapers and condos in key cities, is observed as colossal shift. Half of the world population –3.5 billion people – currently live in cities and urban areas and an estimated 75 percent of the world population will live in urban areas by 2055. Unexpectedly, as cities occupy just 2 percent of the Earth’s land, cities account for roughly 70 percent of the world’s carbon emission and pollution.

More concerns about world hunger and other social issues, problems in politics, health, urbanism and technology have gained a plethora of side effects and have chatted up some of the biggest brains on the topic. How can we achieve a complete balance even at the most basic level to all these problems? How can we arrive at the simplest equation possible to subtract all these?

The Billion Dollar Investment Solution

Several institutions have put forth radical ideas to exponentially solve these with just one simple equation – go for sustainable.

Sustainability goes by many names that it’s actually difficult to tie down. Some call it social responsibility; others would call it sustainable entrepreneurship while for some it is individual liability.

Huge slice of the world are said to be uniquely positioning to painting the globe green through improvements in transport, energy, buildings, food production, technological applications, water and waste systems, as well as producing a wide range of economic and communal benefits.

Understandably, the field of sustainable development requires addressing major challenges. It requires everyone to rethink economy, growth and solutions in favor of a sustainable world. In this content, sustainable investments are now essential obligations majorly for the people ruling behind the world’s everyday life.

The future of sustainability, as both commercial and practical concept is seen as largely dependable on businesses ability to work with the said concept. The roundtable spread virally that attracted a bevy of noted business veterans.

To quote David Blood, co-founder of Generation Investment Management LLP:

“Sustainability investing is the explicit recognition that social, economic, environmental, and ethical factors directly affect business strategy—for example, how companies attract and retain employees, how they manage the risks and create opportunities from climate change, a company’s culture, corporate-governance standards, stakeholder-engagement strategies, philanthropy, reputation, and brand management.”

For businesses and investors, sustainability relies on a consensus-based and scientific definition whereby a vision of a sustainable future is set as the reference point for developing strategic actions is the preferred approach to strategically move a company towards sustainability.

To pick an example of sustainable investment, taking a step to divesting from fossil fuel holdings and rather investing towards the development of clean energy sources is one of the infiltrations big businesses are taking into account. Group of researchers from Forum for Sustainable and Responsible Investment found out that a total of $3.74 trillion in U.S. assets are invested in strategies that consider environmental, social and individual issues. Environmental factors specifically are being used in managing 551 investments in vehicles with remaining $240 billion under management.

Architectural industries have also ventured to sustainable investments. More than just green initiatives and sustainable urbanism, industries aim that revolutionize the industry by increasing yield without harming the earth and compromising the integrity of the urbanity. Innovative structures are adapting to the market’s current needs creating urbanity that isn’t in conflict of sustainability. These trends are also seen as opportunity for other businesses to apply ecodistrict thinking and create ecodistricts — sustainability-driven, district-level development.

Food, housing and other industries have also invested in sustainable and responsible investments (SRI).

Many recent signs indicate increasingly that a new generation of sustainable investment is at hand. Push and pull impact, focused investing, community building, trends in green living, engagement and process emphasis are just some.

The Billion Dollar Benefits

Business benefits from sustainable investments are emerging on an industry-specific basis. Corporate businesses like H&M, Nokia, PUMA, Adidas and others started investing in product sustainability and have achieve tangible business benefits.

Among the leading firms, a report by Verdantix, at least 80% achieved cost savings on logistics and materials; 67% mitigated resource scarcity risks and only 7 percent claimed to have achieved a price premium for sustainable products. More than significant and optimal profit, having your business in line with sustainability can boost your product consumer trust.

A hyper-competitive global business environment, all you have to do is mind your market and where you market. After all, you cannot play politics in modern investments. It is also important to note that many of these sustainable development achievements have been made possible through close collaboration with other stakeholders, businesses, government, advocates and the civil society.

As businesses are toiling behind the scenes, individual efforts are also of major importance for full-blown benefits. It can even be simple resilience on green living. There might be ideas that stop you from venturing in green innovations, but exercising social and environmental duty while pursuing financial returns is more than a trend, it is a responsibility.

So where can sustainable investments take you? The answer should be clear by now.