Positive Investment is any investment strategy that contributes to the wellbeing of people and the planet – a positive vision of the world we want, not just the possible futures that we fear or the developments that we oppose. Positive investment can be achieved in a variety of ways, including through the issuance of green bonds (energy efficiency and/or renewable energy financing), collaborative shareholder engagement, divestment from certain industries and/or (re)-investment into renewable energy, and even the creation of ethical pooled funds and green venture capital that would appeal to other large institutional investors. See below for more details.
Although primarily driven by the urgent need for a response to the threat of climate change, PI is also concerned with other issues such as the impact of indiscriminate weapons and unsafe or exploitative labour standards.
Energy Efficiency Financing
Buildings can be retrofitted to use less energy and save money for the owners. Green bonds or a Green Revolving Fund (GRF) are two ways of paying for building insulation, replacing boilers and windows, etc.
Forceful stewardship involves cooperation among large shareholders to win votes at companies’ Annual General Meetings (AGMs). Institutional investors (large funds such as pensions and university endowments that manage many people’s money) own about a third of the global market. In the US, they own 67% of all stocks.
Green Bonds, Pooled and Venture Capital Funds
A number of investors put their money together, sharing the risk and returns of the pooled investment. Pooled funds are convenient for large institutional investors who would otherwise have to manage a lot of small investments themselves.
Divestment involves selling all shares in unethical companies. The global fossil fuel divestment campaign launched in the fall of 2012; to date hundreds of universities, municipalities, religious institutions, and foundations have divested. It has grown faster than any other divestment campaign in history.
Socially Responsible Investment Funds
SRI funds invest selectively in companies deemed socially responsible. Some avoid certain companies (a negative screen) and others actively seek out companies that meet their ethical standards (positive screen). With the rise of the fossil fuel divestment movement, fossil-free funds and indices (stocks from many companies bundled together) have become popular.