Do people still care about Impact Investing? In the past, I wrote a couple blogs about the future of impact investing and how it could possibly be a gold mine in the future. However, today I will provide an update on whether or not we as a society are anywhere closer to investing with a purpose, then rather solely for just money.
Currently, it is stated that ⅔’s of retail investors have stated that they are interested in sustainable investing. So what is stopping them? According to Investopedias ESG list, the top 3 most companies with the highest ESG ratings are; Microsoft, Linde, and Accenture. With a growth of 50.73%, 28.39% and 44.97% respectively, it is safe to say that these stocks are a great pick for any investor. Tech giants like Microsoft are impact investments’ biggest hope as it offers a different perspective for those who are not familiar with the topic. For those who are just hearing about impact investing, you might think of it as directly investing in some sort of a company that works on decreasing carbon dioxide emissions. This however cannot be further from the truth. Now going back to Microsoft, the reason their ESG rating is so exceptional is because of how they have positively impacted our globe over the past few years. In 2020 alone, Microsoft was able to donate $1.9 billion in order to help over 243,000 nonprofits serve their purpose. Furthermore, because of the Microsoft Airband Initiative, 2.1 million people in the U.S alone were able to gain access to the internet. Clearly because of the many initiatives that Microsoft has started due for their drive to help the world, their ESG rating has skyrocketed. This means that investors in the company have either knowingly or unknowingly participated in impacted investing, which proves both how easy and profitable it can be.
In the future, we can expect many other giant tech firms to follow the steps of Microsoft in attempting to make the world a better place. One example of this is Apple. With Apple’s plan to completely abolish their carbon footprint by 2030, this will be a massive step in the right direction, as other companies will start to realize that it is indeed possible. As many know, a carbon footprint is how much a person or company contributes to greenhouse gasses that are emitted. These greenhouse gasses are lethal as they get trapped in our atmosphere, which causes the Earth’s climate to slowly heat up. By slowing down this process with the help of companies like Apple, we could possibly eradicate the hundreds of negative effects that climate change brings.
Due to giant tech firms like Microsoft and Apple valuing their impact on the world it is safe to say that Impact investing is here to stay. Not only will investing in companies who value their impact on the world, make you as an investor part of something bigger, but it will also provide you with the opportunity for a great amount of return on your investment.
Sources:
https://www.windowscentral.com/microsoft-has-had-profound-technological-and-social-global-impact
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