Would you like to try your hand at sustainable investment? Our co-founder Olga asked five female financial professionals some key questions to help get you started.
Whenever I stand in the supermarket and see the different labels, saying "eco-friendly", "locally produced", "Fairtrade," and the rest, I ask myself: why isn’t it as simple to find out about financial products? And what your investment is used for (or perhaps not used for)?
Because, in the same way that we can choose products that reflect our beliefs, our investments can express our values and make the world a better place.
Studies show that 8 out of 10 women (2017) say that they’d like to make a positive difference when they invest their money. So what are the options? What should you look for? This Q&A will help you find out.
How and when should I start?
Mette Rotboll, co-founder of ThinkYellow who build gender lens investments with financial providers:
"As soon as possible! Clarify what’s important to you. One possible starting point is to choose one or more of the 17 UN Sustainable Development Goals (SDGs) and find ways to support them. (It doesn’t have to be SDG 5 on gender equality!)"
Mette Rotboll and Karina Storinggaard went all the way with this idea - and founded Think Yellow.
Less talking, more action!
"Karina and I knew that something was missing - we wanted to invest sustainably, but also in companies that promote equality between men and women. Many studies show links between having a higher proportion of women in management positions, a stronger focus on societal and environmental issues, and better economic results."
What should I look for in my sustainable investments?
Stephanie Bilo is Head of Customers and Investment Solutions at asset manager ResponsAbility:
"Sustainability is a very broad term. The starting point is to be aware of your own values and how strongly you want these to be reflected in your sustainable investment strategy. Would you like to meet certain criteria when investing, for example the ESG (Environment, Social & Governance) criteria on environmental, social and management structures? Do you want to go one step further and look for a clear social impact - so-called impact investing? The first option allows you to filter your investments to exclude certain activities. The second lets you select investments that support very specific topics, but should also achieve a return. The topics you can choose from might include the 17 UN SDGs."
Stephanie Bilo recommends further:
"The range of products is so broad that you could set up your entire investment portfolio in a sustainable and diversified manner. You can use ETFs (Exchange Traded Funds) and funds, or invest directly in shares or bonds for specific companies or via crowdfunding platforms. You should look carefully at each provider's sustainability know-how and how they define and report on sustainability."
Do sustainable investments make money?
Claudia Bläuenstein, Head of Development Investment at Postfinance, a Swiss payment transaction solution provider:
"Yes! Investing sustainably to protect the environment and society and influence corporate management is a positive decision. Choose investments that fit your style of investment and the investment strategy you prefer. There are a number of sustainability funds that offer good opportunities – and good returns, compared to traditional portfolios."
What is the biggest mistake in sustainable investing?
Edith Aldewereld, financial expert and co-founder of the Women In Sustainable Finance (WISF):
"There still isn’t enough of it! It will take $2.5 trillion each year to balance the inequalities in our society - climate change, health care, clean water and sanitation. These are issues that concern us all. Private investors, pension funds, insurance companies and central banks can use our money to invest in new solutions. The point is not to ‘avoid’ businesses you don’t like, but to make better ones possible. Even if you don’t have much money, you can ask your insurance or pension fund company what investment principles they follow, and make it clear that this is important to you".
Together we can do much more than any one of us can do alone.
Last year, Edith founded Women in Sustainable Finance with Dr Marta Ra and Taeun Kwon, to promote women and target sustainability in the financial industry. Today WISF has over 400 members and promotes exchange and collaboration through networking events, courses and coaching on sustainability and finance.
What would help promote sustainable investment? Does Switzerland have a pioneering role?
Sabine Döbeli, Managing Director of Swiss Sustainable Finance:
"By the end of 2018, 21% of all investments managed in Switzerland included sustainability criteria. Globally, this proportion is only 11%. When it comes to sustainable investment, Switzerland can build on a great deal of innovation, as it has many research and sustainable asset management specialists. Swiss asset managers, for example, manage more than a third of all global private microfinance investments. We must build on these strengths to maintain a leading position globally in this dynamic environment".
What would make it go even faster?
Sabine says: "Sustainable investment is already growing fast today. If both private and institutional clients consistently ask for sustainable investment solutions, this will continue. More transparency on the sustainability of products would also help customers give sustainability an even higher weighting in their investment decisions."
Money can be a tool for expressing your values.
For this article I could only speak to a few people who are committed to creating new options and making a difference. No matter what you decide to do, whether it's donating, investing sustainably, or giving money your time and knowledge - it counts. Because our world matters to all of us.
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