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The global pandemic has put our world in a state of shock and the ongoing health crisis has affected us all. Alongside this; climate change, institutional distrust, a changing economic landscape and food insecurity persists. We are in a state of massive market uncertainty. As an investor, it is a responsibility to assume financial risk in a strategic manner, in order to create both profits and solutions for the world. This is more important now in 2021 than ever before. Impact investors go a step further, differing from the traditional conception of investing by employing a triple-bottom-line return strategy. The reason is that impact investments have the challenging variable that the company or project must have a proven positive impact on the world.
According to a Morgan Stanley 2019 study, 8 out of 10 investors are interested in sustainable investing, however, only half have actually done so. In reflecting on this study, Walter Schindler of Forbes speculates, “Impact investing is all too often a rhetorical wave that never hits the shores of decision, action and reality”.
In drawing focus to the E, in the popular ESG metric, in recent years and even weeks it has become evident that the health of the environment is imperative for the planet and our people. A study carried out by Harvard University reflects this, where it was shown that across the United States, people with COVID-19 who live in areas of high levels of air pollution are more likely to die from the disease than those who live in less polluted areas. However, the initial lockdowns in 2020 saw a decrease in air pollution in heavily polluted regions, due to things like reductions in air and auto travel, and stay-at-home orders. For example, China had a 40% drop in NO2 from 2019 in January and February of 2020. In the past two years, we have seen countless other pieces of evidence that show that the environment can heal and self-rehabilitate, which gives us all the more reason to seek investments that support this. When we invest in ventures that will contribute positively to the environment, we protect our own health in the long run.
Impact investing needs to be promoted meaningfully if it is to be successful, especially in Australia. That’s where SUIIS comes in.
