Responsible investing on the rise
Written on the 2 October 2021 by Arrow
For many people, there’s much more to choosing investments than focusing exclusively on financial returns. Returns are important, but a growing number of people also want their investments align with their values.
Millennials driving growth in sustainability
The trend toward responsible investment is growing rapidly. According to the Responsible Investment Association of Australasia (RIAA), Australians invested $1.2 trillion in responsible assets in 2020.ii While money flowing into Australian sustainable investment funds was up an estimated 66 per cent in the year to June 2021.iii
More sustainable investment options
As awareness of responsible investing grows, so does the availability of sustainable investment options, beginning with your super fund.
How to screen
So how do you find the ethical investments that best suit your values?
Greenwashing on the rise
As the popularity of responsible investing grows, so do concerns about the practice of so-called greenwashing. This is where a company or fund overrepresents the extent to which its practices live up to their promises. The Australian Securities and Investments Commission (ASIC) recently announced a review into the use of greenwashing in Australia, prompted in part by the demand for such funds.iii
While some investors are driven by their values alone, many more want value for their money. The good news is that it’s possible to have it both ways.