The buzzword is ‘sustainability’. Is it just hokum or does it make a difference to the environment and more importantly, will investing in it give you good returns?
Well, the answer is yes to both.
Sustainable investing or ESG investing (Environment, Social, Governance) is investing in companies that do the right thing. They commit to lowering their carbon footprint in their manufacturing processes and in their factories and buildings, invest in their employees’ wellbeing and believe in equal opportunity without discrimination, and follow strict rules about how the company is run and how it is regulated.
Let’s face it, global warming is a real thing and closer than we think. Most major global companies realise the impact of their manufacturing processes on the environment and the importance of leaving a better tomorrow for their children.
A sustainable fund includes many major global companies that are profitable, they just exclude companies not committed to ESG yet. The track record of sustainable funds is comparative to normal funds and in some cases even outperform them.
Advantages of investing in sustainable funds
• History does show that sustainable funds could have a lower risk parameter and show smoother fluctuations when markets are volatile as compared to traditional funds e.g. during years of turbulent markets such as in 2008, 2018 etc.
• Makes good financial sense and reduces carbon footprint.
• Less likely for major environmental incident or high-profile negative event e.g. harmful chemical spill, or employee mistreatment scandal, which in turn will affect the stock price of the company.
deVere has committed to ESG regulation and offer an exclusive sustainable fund through their dVAM fund platform. Chat to your adviser today about adding a sustainable fund into your portfolio. [email protected]
Please note, the above is for education purposes only and does not constitute advice. You should always contact your deVere adviser for a personal consultation.
* No liability can be accepted for any actions taken or refrained from being taken, as a result of reading the above.
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