According to a recently released United Nations report, one million plant and animal species are facing extinction due to human activity. The world’s unprecedented decline in biodiversity poses a dire threat – not only to Nature, but also to the well-being of people: their health, quality of life, food security, economy, and jobs.
If you’re passionate about creating a better world – whether it’s optimal health and well-being, quality education or protecting the environment – you can do good by how you invest your money.
Impact investing creates a supportive investment environment for entrepreneurs who want to do something positive in society, says Mel Wilson, who heads up a Calgary-based sustainability management consulting firm that works with clients across Canada. What’s different about impact investing, Wilson explains, is that the focus is on investing for the purpose of bringing about social change, in addition to receiving a financial return.
“You’re actually taking an ownership stake in companies that have shared values with yourself – and that’s a much more powerful and effective way of bringing about change” [compared to being a consumer].
A panelist on the United Nations Sustainable Development Goals (UN SDGs) at a recent environmental gathering hosted by the Alberta Ecotrust Foundation, Wilson describes the traditional approach to investing, which maximizes profit and the return to investors, as “not inherently bad. It’s just that there are unintended side effects which if not addressed, can become major problems down the road.”
Adopted by the UN in 2015, the UN SDGs are “a very good framework for understanding what the bigger sustainability issues are. They can help you decide where to invest, based on your values and what’s important to you,” Wilson says.
The UN SDGs, which help companies manage, measure and report on their sustainability performance while encouraging them to thrive, are all about helping certain companies or industries operate, to either expand their market, or change how they do business to become more environmentally or socially friendly.
For investors who want to help bring about change, Wilson says the SDGs provide a strong vision for gender equality: whether it’s creating new investment opportunities for female investors or equally important, for women who are on the receiving end of capital. “If you are a female entrepreneur who is looking to raise capital to fund the growth of your company, the SDGs are ready-made.”
The SDGs encourage blue chip companies to up their environmental and social game, and they can have a big impact on small to medium-sized companies, because when people choose to invest in them, “you have an opportunity to help those companies get established and grow.”
It’s critically important to recognize there is always a risk associated with this type of investing, Wilson adds. “Part of your homework is to get a level of comfort that the company’s idea is sound and the growth opportunities are realistic.” To help you move forward, he recommends looking for input from independent investment analysts on the worthiness of an investment and in the initial stages at least, enlisting the help of an experienced investment advisor.
For those interested in getting more information, check out Albertasdgnetwork.com or contact email@example.com, a not-for-profit organization that provides a forum for individuals and organizations from around the world to share information and explore partnership opportunities.