The most quoted reason for investing in companies that are socially, environmentally, and ethically responsible, a practice known as ESG investing, is that it is the right thing to do. There is, however, another reason that even the most cynical investor should consider it: It is profitable and is destined to become more so over the next few decades.
The reason is obvious to anyone who has children. Our children’s generation have been consistently taught from an early age that some kind of environmental awareness is normal and that discrimination on the basis of race, gender, sexual identity or anything else is not acceptable. They typically have a wonderful attitude to those things, not aggressively pro or anti inclusion and equality, just indifferent to them as issues. It is hard to hate something when you don’t see it as anything but perfectly normal. And when acting in an environmentally responsible manner is simply what you do rather than a product of a campaign or protest, it becomes a lot more sustainable and just about universal.
As millennials and subsequent generations take over the reins of power, both politically and financially, that is becoming the predominant attitude, with those who retain some form of bigotry viewed with a powerful pity or a withering, somewhat comical disdain. Investing in companies that are ahead of a game that powerful, destined to dominate, is a good idea, whatever your own attitude may be.
Nasdaq
by Martin Tillier
MAY 24, 2021 9:55AM EDT