We all have different priorities in life. This also applies when it comes to investing our money. But there are certain themes that are top concerns for sustainable investors.
Let’s take a look at what’s grabbing the attention of those who want to make more ethical choices with their investments.
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What does it mean to be a sustainable investor?
There is a lot of back and forth around what makes a positive investment.
Broadly speaking, sustainable investments can fall into two categories:
- Investments that try to improve the world through social or environmental impact.
- Investments that do not put money into businesses whose actions may be harmful to the planet or society.
Obviously, there are plenty of grey areas when it comes to investing this way. ESG investing aims to tackle some of the difficulties. It does this by providing certain criteria that must be met in order for a company to be a suitable investment. But it is not a perfect system.
What are the top priorities for sustainable investors?
New research from wealth management company Tribe Impact Capital shows some popular themes amongst those who are trying to invest sustainably. Let’s see what the two key areas are.
1. Climate action
It may not surprise you to hear that positive climate impact is the number one priority for sustainable investors.
What happens with the climate affects everyone on the planet, no matter where we live or whether we’re rich or poor. As a result, 69% of Tribe’s clients rate climate action as a top investing priority.
Environmental issues have been in the headlines for a number of years. They are generally easy for people to wrap their heads around. Shares in companies involved in the green transformation have also performed very well. This can be a profitable place for investors looking for long-term growth.
2. Quality education
Not quite as glamorous or planet-saving, education is the number two priority for sustainable investors.
Investing in education is a smart way to future-proof society and make sure that we have people able to deal with tomorrow’s issues and problems.
So it makes sense that 68% of investors rated this area as one that they are keen to support. Lack of quality education can lead to difficulties in the future. Investors understand how important learning is because it impacts every industry and every part of our lives.
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How can I become a sustainable investor?
Sometimes, it can be hard to know where to begin when it comes to sustainable investing. Hopefully, this has given you some inspiration.
These days, becoming a sustainable investor is easier than ever. Using a share dealing account, you can invest in companies tackling climate and education issues. If this sounds like too much work for you, most platforms and investing solution providers will help you build an ethical portfolio at a low cost.
Just remember that all of the same investing risks apply to sustainable investments and you may get out less than you put in. But at least you can be comfortable in the knowledge that you are helping to create positive change with your money.
