Your investment doesn’t have to benefit just you, it can also benefit the world around you. That’s the principle behind sustainable investments – namely that investing in well-managed businesses with interests in improving the environment or quality of life can deliver superior returns over time.
Many investment firms will have made a commitment to invest in sustainable stocks. Some even offer specialist sustainable pooled funds that specifically invest in companies involved in ethical or green industries.
You might think that the worthier the investment, the lower the return – when in fact, it’s rarely the case. Many sustainable companies plug into growing social and environmental trends, producing products and technology that an increasing population will need ten, 20, and 50 years down the line, which means a greater and more robust return.
Here are five examples of companies involved in sustainable business and why they might make the cut of a typical sustainable fund.
Note that these are not investment recommendations.
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As with any investment, their value can fall as well as rise and investors may not get back the original investment.