Ethical investing is not a new concept, but it has surged in popularity over the past decade. According to the Harvard Business Review, US$11.6 trillion of all investments are managed under Environmental, Social and Governance (ESG) criteria, meaning that they meet specific criteria that benefit ethical causes. A major driving force behind the appetite in investors for these positive investments is technology, which is having a transformational attitude on investor attitudes.
(TOP: Photo by Chronis Yan).
An example from America
One of the most eye-catching examples of investment being lead in this manner has come from the USA. The controversy of gun control is a debate that has raged for decades, but 2019 saw tech giants including Twitter and Uber demand action to change legislation, according to the New York Times. The impact this has had on investors has been startling. With the two companies worth over $40 billion altogether, investors and investment vehicles have responded by providing the tools to move into gun-free investment. Several key players in the global market now offer specialised funds and schemes, which investors can employ to guarantee their investments aren’t placed into funds that back causes they don’t support. For this purpose, the influence of tech companies is clearly demonstrated.
Making a direct impact
Tech companies provide the impetus for investment companies to change; but they also have a direct impact, too. Consider the case of Energise Africa, featured in the UK’s Guardian. One of many firms offering direct investment into Africa, they prioritise their funding into tech – in this case, solar panels, which the company suggest can save lives while still providing good ROI. This can have a transformational impact on lives and shows the strength of tech companies in providing wealth growth through their technology. It also helps to tick another one of the major boxes when it comes to the major challenges faced by the planet: climate change.
Climate investment – in Africa and globally
Tech has a leading part to play in combating climate change, and this includes through driving investment. Ultimately, real progress is made wherever the market goes, and tech companies and firms are helping to direct that towards positive climate action. 20% of all investments are now made in ecologically friendly markets, with further gains being made as more international governments issue green bonds – the African Development Bank being one of the bigger institutions issuing these investments. Elsewhere, Nigeria is one of many countries partnering with large firms to offer out green investments. As always, technology is leading the way, largely through attempts to entirely reform the energy sector and ensure that all new development in Africa is completed in a way that is environmentally suitable.
Through technology, ethical investment is becoming commonplace and favourable for investors. Smart technology underpins much of the progress the world is making. Whether that be through the products themselves or the pressure of the tech lobby, a real positive impact is being made that can also bring rewards for patient investors.