There’s little doubt that responsible investment will be the future standard. Today, some people may still wonder why, but the answer is plain and simple – who isn’t interested in creating a sustainable world? So let’s turn the question on its head: Why not invest responsibly?
Of course, it’s vital that we create a sustainable world. So why not invest responsibly?
Solange Rouschop Sustainability Manager ABN AMRO Retail & Private Banking
As a matter of fact, responsible investment isn’t all that different from traditional investing, as a company’s earnings model and future prospects are just as important in informing sustainable investment decisions. But on top of these, environmental, social and governance (ESG) factors come into play: Does the company use or produce pollutants, or is it guilty of human rights abuses? Investing responsibly is about taking a stake in companies that make a positive contribution to solving issues facing society and humanity.
Myths about responsible investment
There’s a lot of myth-making around responsible investment. Perhaps the biggest misconception is that sustainable investing comes at the expense of returns. That’s simply not true. In fact, responsible investment is in no way inferior to traditional investing, but there are still people who believe responsible investment just means ethically responsible or is a kind of philanthropy – as if these investments are conviction-based only and not at all about generating returns.
What’s more, quite a few people still equate responsible investment with green investing. Of course, some investments focus on pure green plays, such as wind energy specialists or producers of recycled biomaterials. But responsible investing is so much wider: it’s about doing business with an eye to the world we all live in. These are companies that take a lead role in finding, striking and maintaining a balance between people, planet and profit. And that could be a company in almost any field, from a brewer generating its own energy using solar panels to a garment manufacturer ensuring robust labour conditions in its manufacturing processes.
I see a lot of demand for sustainable investing. Customers have become increasingly socially aware and want to know where we invest their money. At this juncture, ABN AMRO invests some €4.8 billion responsibly and I reckon this will grow exponentially in the months and years ahead. As a matter of fact, sustainable investments often turn out very rewarding. And if returns are typically the same or higher as on traditional investments, why not invest responsibly?
Investing for a sustainable world
Hopefully, you’ll also choose to invest responsibly going forward, contributing to the creation of a sustainable world. Our advisors will be happy to tell you all you want to know about responsible investing – do contact us to set up a meeting.