Responsible Investment 101
Responsible investment (also known as ethical, sustainable, green or socially responsible investment) is a term that describes an investment process that also takes environmental, social, ethical or governance considerations into account. This differs from conventional investing, which typically focuses on the bottom line.
The concept of responsible investment has been around for decades, however in the past five years or so it has broadened, particularly in relation to the recent focus on the environment, and more specifically, climate change.
Businesses and investors alike are becoming increasingly aware of the impact of climate change on the planet and therefore on the operations and profitability of companies around the world. In fact, to those companies who have the foresight to take the changing environment seriously, it poses an incredible opportunity – likewise to those investors who support them.
Responsible Investment Association Australasia
The Responsible Investment Association Australasia (RIAA) is the peak industry body for professionals working in responsible investment in Australia and New Zealand. The RIAA also helps individuals and organisations to learn more about how they can make investment choices that take environmental, social, ethical or governance issues into account, as well as financial objectives.
The Responsible Investment Association Australasia website is a great resource with lots of information for anyone interested in responsible investing.
Principles for Responsible Investment
The United Nations-supported Principles for Responsible Investment (PRI) initiative were developed by the UN with a group of the world’s largest institutional investors in 2005-06 to provide a framework for investment professionals taking environmental, social and corporate governance issues into consideration when building investment portfolios.
Read more about the United Nations-supported Principles for Responsible Investment Initiative – the website includes links to interesting articles about responsible investment.
Finding a Financial Adviser
If you’re after a financial adviser in your part of Australia who specialises in ethical investment – someone who can align your values with your financial goals – try the Responsible Investment Association Australasia. Experts often suggest you find an adviser who charges by the hour instead of receiving a commission.
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