One of the rising investing trends of recent years is socially responsible investing. This category of investing focuses on investments that are meant to have some sort of social value, whether it’s investing in companies that make it a point to respect human rights, or investing in funds that refuse to include “sin” holdings of tobacco, alcohol and gambling companies. One segment of socially responsible investing is green investing also known as sustainable investing.
Green Investing: Sustainable Companies
If your financial values dictate that you support companies that engage in green practices, there are ways to invest in them. There are companies that provide green energy and green products. Companies that build wind energy components, or that develop bio fuels can provide opportunities for portfolio growth while helping the planet. However, you can also invest in companies with sustainable practices.
The Global 100 is a list of the most sustainable businesses on the planet. A a number of companies, from different countries, are listed, providing you the opportunity to diversify, while still investing in sustainability. Many of the companies also pay dividends, helping you create investment income while supporting companies with green practices.
Green Investing: Indexes, Funds and ETFs
Realize, too, that it is possible to invest in mutual funds, index funds and ETFs that invest in sustainable companies. There are ETFs made up of clean energy companies. There are mutual funds comprised of companies following sustainable practices. There are indexes made up of green companies, and you can invest in the funds that track them.
Choose Green Investments Carefully
Of course, just because you want to invest in a green company doesn’t mean you should take any opportunity that comes along. Just as you would vet any other investment, you need to do your homework as it relates to your green investing. Consider the size of the company, its management, its potential for growth, and what it plans to do to stay competitive and market itself. If you are interested in investing in a green startup, make sure that you feel good about the business plan and the people involved.
And, of course, you want to investigate the company to see if you truly agree that it is involved in green practices. Some companies claim to be sustainable, but they are not. Other companies might be considered “green” by some industry group, but you might not agree with the criteria. Do a little poking around on your own.
While you do want to support sustainable businesses, it’s important that you don’t just throw money at anything “green.” There are different online publications that can help you find green investments. These include SeekingAlpha, GreenMoney Journal, Clean Break, SRI Monitor and SustainableBusiness.com. SocialPicks can also be an interesting place to get green investing ideas.
You really can invest in a sustainable manner. Do your homework, and it is possible for you to find green investments that are better for the environment, while boosting your portfolio.
Have you considered green investing? If so, why? If not, what is holding you back?