April 13, 2021
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Know Everything About Responsible Investment: Why It has Become New Normal?

Responsible investment in Australia has been gaining a lot of popularity in the mainstream of financial management due to global bushfires; climate change and the COVID-19 pandemic. These situations have encouraged the government to create new investment strategies and financial management plans to sustain and boost the economy. The time is tough and responsible investment has emerged as one of the trusted ways to control your financial decision.

 

What is Responsible Investment?

Responsible investment is a great investment strategy which incorporates environment, Social and Governance aspects into financial investment decisions. It has been clearly stated that ESG factors can directly affect your financial investment decision.

According to experts, this type investment is a part of our vision. They encourage investors to bring positive change in companies and their investment plans by focusing on the long-term impact they have on the society and environment.

 

Why to Invest Responsibly?

Making right investment decisions has become the need of an hour. Due to the COVID-19 pandemic, many people have lost their jobs, many new business have shut down, etc. However, investing responsibly is not just the great choice for the environment, but can also deliver strong investment returns for a long-run.
According to the recent benchmark report fro Responsive Investment Association Australasia, making investment funds with RSG focus has showed some positive results in the past few years. This type of investment has outperformed with 37 per cent of total funds under financial management in Australia now invested responsibly.

 

Why It Has Become New Normal?

In the past two years, responsible investment has surged in Australia. More and more people are looking to merge their financial management activities with their personal values, especially to face climate changing situations.
During bushfires in Australia, business owners, property investors and other people shifted towards responsible investment. The most frequently searched topics were climate change and fossil fuels. This clearly means Australians are searching fore innovative ways to reduce the adverse impacts of global warming. However, the COVID-19 pandemic continues to affect our social and financial concerns in the sector of housing and employment, investing for social change has become emerged as a buzz word these days.

There is no denying the fact that responsible investment has been attracting various institutional investors in Australia. By evaluating the ESG profile of a company, the investment managers can manage the exposure of funds to climate risk by avoiding certain sectors as well as companies. They can find out the potential growth areas in the current economy, such as green hydrogen, battery storage and electric vehicles.

Make sure you follow the money because it is rapidly flowing away from fossil fuels. Investment markets have been witnessing the new wave in the area of responsible investment because it is driving the entire investment management industry. It has become the new normal and there is no relevant reason to avoid it.
Responsible investing can also allow every one of us in shaping the society we live in. For example, investment in renewable showed some positive growth of the solar and wind energy markets. This will keep the environment save while letting you focus on making right investment decisions for a long-run.

Potential investors can invest in businesses, sectors and assets that support a sustainable environment, a healthy society and focus on reducing other devastating aspects. This has also reflected possible signs in some of the areas such as affordable housing and health care facilities.

 

Australian Ethical: An Innovative Way to Invest Money

Nothing is better than generating higher returns on investment while boosting the environmental, social and governance factors. By selecting Australian Ethical Investment, you can invest in line with your value and generate higher returns for a long-run.
It is your time to make a decision of investing retirement savings in fossil fuels companies that can improve the health of our planet and also reduce the impact of climate change. In fact, the banks are funding those companies who have a potential growth strategy that fits best with the low-carbon economy.
The government is also encouraging difference companies to set targets to decarbonise their functions to limit climate change and develop the market demand to save the environment from climate changes.

 

Endnote

Making right investment decisions can make a huge difference and help you get higher returns for a long-run. However, responsible investing has become a new trend due to environmental impact, climate change, bushfires and COVID-19 pandemic situation. You can still generate higher returns while making right decisions for our planet.