Climate change, increasing population growth, aging and urbanization: society is facing inescapable global challenges. The pressure is growing to adopt a different approach to our fellow human beings and our planet. Many investors are therefore looking for investment opportunities that have a positive impact on the environment and society. The focus is not only on increasing value, but also on personal values that reflect ecological and social aspects.
The difference between sustainable and conventional investing
Sustainable investments represent an investment philosophy in which investments are made that have a positive impact on the environment and the society. Ecological and social concerns are generally kept in mind, as well as corporate management factors. Depending on your preference, the focus can be on a different investment choice. For example you might decide to only select investments that do not support environmentally harmful activities or investments in companies that pay equal wages to men and women. Similar returns, or even better returns in the long term, are achieved than with conventional investments. Topics referred to as ESG (environmental, social, governance) offer a broad spectrum of possible investment strategies, ranging from climate-friendly to business-friendly investments.
How to avoid climate damage thanks to your investment
Switzerland has set itself the target of eliminating fossil fuels by 2050 at the latest. Climate-friendly investments therefore invest in companies that develop solutions to environmental problems. These can be investments in renewable energies or funds that give less weighting to companies with a large CO2 footprint, for example. By investing your assets in instruments with an ecological focus such as sustainability funds, you can make your personal contribution to combating climate change and generate returns at the same time.
How you can contribute to a sustainable healthcare system
Faced with population growth and the increasing aging of society, the healthcare market is gaining in importance. At 65 billion francs, it is already twice the size of the energy market. Sustainable investments in healthcare place the emphasis on innovative products, solutions for mobile healthcare or biotech companies, for example. Investments of this kind are not only sustainable because of their positive influence on society, but also enable you to profit from the growth of the sector and generate corresponding returns.
Why ethical management is profitable
Companies that promote equal opportunities are an excellent target for investors who want to invest their funds sustainably. According to a UBS study, companies in which one in three managers is female achieve a higher net margin than companies without women in management positions. Numerous studies indicate that economic growth in the future will depend on how well people with different backgrounds, such as origin or religion, are integrated. Impact investment in the area of diversity thereby combines social responsibility with good returns for you.
How sustainable investment and consumption can be reconciled
Spring is not only the time when the flowers start to blossom, but also when the alarm bells begin to ring: in May 2019, Switzerland’s natural resources had already been consumed for this year – we are leading a life on (resource) credit. This has serious consequences for the entire world: species extinction, water scarcity, global warming. However, consumers are increasingly aware of this. There is therefore growing demand for ecologically, fairly and sustainably produced products and food. This, in turn, gives companies the impetus to address these demands. For you, this development is an opportunity to influence sustainability in supply chains, packaging materials or food production by making sustainable investments. In this way, you will not only pursue sustainability goals, but also achieve profits.
What economic growth has to do with sustainability
With sustainable economic growth, new jobs can be created without destroying the foundations of life. For example, the energy requirements of emerging countries are covered wherever possible with green energy such as solar power. Emerging markets in particular justifiably do not want to slow down the growth of their own economies. This makes a focus on sustainability all the more important. UBS has therefore developed guidelines for assessing investment opportunities based on ESG criteria, providing investors with sustainable investment opportunities. Their money can thereby enable emerging countries to take a step forward without endangering the climate or sacrificing their returns.