What is Investment in regards to sustainability?
Sustainable, responsible and impact investing is an investment discipline that considers environmental, social and corporate governance criteria to generate long-term, competitive, financial returns with positive societal impact.
Socially responsible and sustainable investment is critical for both developed and developing countries to achieve economic stability, to improve the welfare of their populations, and to meet basic needs. However achieving this without deteriorating or depleting the resource-base that underpins development, including social and environmental development, has historically been a controversial challenge.
Key questions for this area
If you are teaching or studying in this area, or are considering including content in your unit, here are some questions that you should be able to answer and/or consider:
- Investment can only come from savings or borrowing from the future. The past model of investment (e.g. by the US) have led us towards a very treacherous path which was evident from recent global financial crisis. Will the current shift of financial power to BRIC nations, which have a more conservative savings strategy, lead to higher global investment and stable economies?
- Certain patterns of investment exacerbate inequality. What is the preferred option for society as a whole?
- Despite our past efforts society has faltered on the path towards green growth through promoting green technologies. How can international governance be modified and utilised to promote investment in green technologies as well as consumption of green goods?
- Demographic patterns of the world are changing; developed countries have an ageing population (as well as China in the future). How will that impact societal management of superannuation funds which have tremendous bearing on investment options?
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