February 20, 2024

Eco-Friendly Investments

In order for companies to grow and prosper, they must rely on risk takers willing to support their mission or product. These risk takers are investors and, next to consumers, they are the other half of a company's base. Without them, companies wouldn’t be able to grow as readily or even lift off the ground. Investors are there at a time of need as well;  if a company isn’t performing well, investments can offer them peace of mind and support through tough times. Much like the rest of the world, the way people invest is also changing - many are no longer focused on trying to maximize profit regardless of the cost. Investors are now accounting for a company’s social and environmental impact when funding them in hopes of creating benefits on all fronts - generating income while prioritizing environmental stewardship and social equity. These investments are known as Eco-Friendly or Sustainable Investments, and, if executed properly, they can be an incredible instrument of change and a key component in tackling the world’s biggest and most pressing issues. 

Eco-Friendly Investments entail funding initiatives or companies that aim to create long lasting, positive benefits for the environment, people, and the economy. Eco-friendly Investments can take on a number of different forms and have a diverse set of objectives, but the ultimate goal is to promote sustainability on all fronts. Investors can support companies that prioritize reducing single use plastic and packaging. They can support businesses that offer equity programs for their workers that enhance their quality of life. Investing in these programs and companies has the added benefit of conserving the environment and bettering workers’ lives, but it also creates a profitable return on investment for all parties involved.

Much like the evolution in what companies invest in, there has been a substantial change in who does the investing. Until recently, making meaningful change through investing was only an option for elite firms or the wealthiest of people. While the average consumer could always participate, ways to invest were limited and not easy. Thanks in large part to the evolution of mobile technology, the Internet, and online investment services, that has changed - an individual now has more access to information and services than ever before. This has allowed consumers to fully participate in Eco-Friendly Investmenting, and there are now so many Eco-Friendly investment options for consumers to use. 

In a world facing global climate change, it is essential that companies involved with sustainability and lower fossil fuel outputs receive more investment opportunities. Investment companies like Earthfolio realized this and decided to make it their mission. Earthfolio is an Environmental, Social, and Governance (ESG) investment firm that solely supports companies that are environmentally and socially responsible. Examples of these companies include fossil free businesses or businesses that support social movements or local community empowerment. Ellevest is another ESG investment company that is combating a different issue - gender financial disparity. According to the Pew Research Center, women are statistically more likely to get paid less for work, accrue more debt, and find less job advancement opportunities when compared to men. Women are also less likely to invest than men. Ellevest is a women owned and operated investment company that works to put more women in a place of financial power and help them earn more. The company focuses on investing in companies that prioritize gender equity or are women owned or co-owned. Companies like Earthfolio and Ellevest give investors the ability to both generate wealth and create positive change for the people and the planet.

Eco-Friendly investments are effective investment methods aimed to promote environmental stewardship and social equity all while maximizing ROI. While Eco-Friendly investments have been around for quite some time, innovations in technology have given consumers more access to different investment firms that strive to create impactful change to a better world. Not only are these investments important, but they are surging in popularity and in growth. For instance, The Climate Bond Initiative reported that the value of Green Bonds, or a form of loans given out to businesses that are used for green projects like renewable energy, was $1.7 trillion in 2020. This shows that there is incredible interest in investing in sustainability to tackle the world’s biggest issues and that Eco-Friendly Investing is here to stay.