The Future For: Green Investments
The Future is Green
Global Green Economy
The global green economy was valued at over $8 billion in 2009. It has dramatically changed the way that companies conduct their business today. The sector which creates power from solar and wind energy is continuing to grow and the equity market shows high performance in these sectors. In the wind energy market alone, there were returns of over 300% in 2007.
Green Investments and the future
The green economy is based around traditional environmental activities. Driving the trend for green investments is the very real need to limit the effects of global warming. Ever increasing environmental concerns have prompted action. Investing in the green economy has also become more popular in recent years with institutional investment practice.
The reasons that people choose to make green investments are three fold. Recent economic studies show that there are three types of forces at work which influence investors. These are: environmental, social and governance related motivations. Social responsibility and ethics are a strong motivation for investors.
Fear of Climate Change
Both global consumerism and the related over use of fossil fuels have played a huge part in contributing to climate change. Today, consumers are much more environmentally aware than they were in the past. Therefore, environmentally friendly products are now big business. The future of the planet is a serious issue and people worry about the effect that their actions are having. The reputation of a company must therefore be viable.
A Greener Future
Companies seek more clean and efficient alternatives to old industrial methods. Adopting this strategy is often in line with governmental regulations and constraints. Companies with changing attitudes and those who embrace new production technologies are going to have more favorable outcomes in future.
Those who fail to clean up their production methods by reducing carbon dioxide emissions need to offset them. A company is allocated a yearly limit for the production of carbon dioxide or the equivalent in greenhouse gases. Offsetting occurs when the company is forced to buy carbon credits for the amount of greenhouse gas they have produced over this threshold.