A leading ethical investment company is urging its clients to support companies that are creating sustainability and efficiency in their industries.
Financial planning and investment management company Holden & Partners, produce an annual guide to ‘climate change investment’ – which helps investors understand this market.
Partner, Steven Pyne said: “Climate change is and will continue to be one of the principal drivers behind world politics and economics in the 21st century.”
Pyne believes that key investment opportunities rest with companies that are responding to the challenges posed by climate change. “As an investor it is important to recognise, prior to the rest of the market, changes and trends that will be the norm tomorrow,” he said.
The Holden & Partners guide is based on the premise that whether people believe in man-made climate change or not, human activity is putting a squeeze on our natural resources and energy security, resulting in global water and food shortages, extinctions and extensive pollution.
Mark Hoskin, managing partner at Holden & Partners, said: “Society must address these issues and use the resources we have much more efficiently than we have done to date. This investment theme stands independent of the arguments for or against climate change.”
Holden & Partners believe that investment managers need to decide whether they are investing in the ‘new economy’ or the ‘old economy.’
Pyne said: “The old economy uses inefficient processes to mine and burn fossil fuels. It produces huge amounts of waste, pollutes the oceans and mines and extracts resources with impunity because the thinking has been that they would never run out.”
However, according to Holden & Partners this mindset is changing and companies that introduce more efficient and sustainable processes will profit from this change in focus.
“The new economy is supported by a rising volume of government policy,” said Pyne. “All investors should consider themselves on notice that a dramatic change is underway. It requires investors to rethink their approach, because investing in the new economy is sure to deliver long-term returns.”