Investing in a Sustainable World

By O'Neill, Barbara | Journal of Financial Counseling and Planning, July 1, 2009 | Go to article overview

Investing in a Sustainable World


O'Neill, Barbara, Journal of Financial Counseling and Planning


Investing in a Sustainable World Barbara O'Neill Author: Matthew J. Kiernan Publisher: American Management Association ISBN 13-978-0-8144-1092-9

According to a study reported in the April 2009 Journal of Financial Planning, many investors are interested in "going green" when it comes to selecting their investments. Allianz Capital, a leading global investment firm, found that 64% of surveyed investors considered the environment as the most desirable investment opportunity among 10 investment categories surveyed. The survey also reported a 30% increase in the number of investors who have made environmentally-oriented investments. However, more than two of three (68%) respondents indicated that they would need to consult someone in the financial services industry for help with environmental investing decisions.

What about investors who want to purchase environment-related investments but lack a financial advisor? Enter Investing in a Sustainable World, an extensively well-researched and clearly written 300-page book that explores this topic from every conceivable angle. The author, Matthew Kiernan, is founder and Chief Executive of Innovest Strategic Value Advisors, Inc., the top-ranked sustainability investment research firm in the world. Dr. Kiernan previously served as Director of the World Business Council for Sustainable Development and has spoken several times at the prestigious World Economic Forum in Davos, Switzerland. In the book's introduction, he introduces readers to environmental and social (ES) or "sustainable" investing, noting that ES factors are "absolutely and increasingly critical to the competitiveness and financial performance of both individual companies and the broader economies and societies in which they operate." Kiernan also describes six "fundamental truths" about ES investing and provides a roadmap to the book.

Chapter 1, "Welcome to the Sustainable Investment Revolution!," begins with encouraging news for ES investors: major Wall Street investment banks (many of which subsequently collapsed or were merged out of existence as the book was in press) were starting to write reports about climate change, water scarcity, human rights issues, "and a host of other topics they have been studiously avoiding." Moreover, in less than 18 months, the United Nations Principles for Responsible Investment attracted more than 380 signatories, and a global investor coalition attracted supporters with $55 million of assets within 6 years. Kiernan notes that "the Sustainable Investment Revolution is driving a worldwide industrial restructuring, radically changing the very basis of competitive advantage for companies and, therefore, investors." He further notes that sustainability issues now matter to many companies, citing successes such as the Toyota Prius hybrid car. Chapter 1 also discusses factors that are driving the sustainable investing revolution, distinguishes ES investing from more commonly known socially responsible investing (SRI), describes key environmental and social issues, and outlines the "four pillars" of ES investing: environment (e.g., minimizing adverse impacts), human capital (e.g., employee retention and innovation capacity), stakeholder capital (e.g., interactions with external stakeholders), and strategic governance (e.g., how companies handle ES issues).

In Chapter 2, "What's Taken Us So Long?," Kiernan attributes the slow appreciation of ES factors in investment decisions to both "individual intellectual inertia and collective organizational inertia" and cites a number of specific examples as well as six enduring myths about sustainable investments (e.g., "addressing sustainability factors is irrelevant or even injurious to risk-adjusted financial returns"). He also describes Wall Street analysts' fixation with "making their quarterly numbers" (which downplays concern about the future financial potential and true competitive risks of a company) and fleshes out the four pillars of sustainability, noted above. …

The rest of this article is only available to active members of Questia

Already a member? Log in now.

Notes for this article

Add a new note
If you are trying to select text to create highlights or citations, remember that you must now click or tap on the first word, and then click or tap on the last word.
One moment ...
Default project is now your active project.
Project items

Items saved from this article

This article has been saved
Highlights (0)
Some of your highlights are legacy items.

Highlights saved before July 30, 2012 will not be displayed on their respective source pages.

You can easily re-create the highlights by opening the book page or article, selecting the text, and clicking “Highlight.”

Citations (0)
Some of your citations are legacy items.

Any citation created before July 30, 2012 will labeled as a “Cited page.” New citations will be saved as cited passages, pages or articles.

We also added the ability to view new citations from your projects or the book or article where you created them.

Notes (0)
Bookmarks (0)

You have no saved items from this article

Project items include:
  • Saved book/article
  • Highlights
  • Quotes/citations
  • Notes
  • Bookmarks
Notes
Cite this article

Cited article

Style
Citations are available only to our active members.
Buy instant access to cite pages or passages in MLA, APA and Chicago citation styles.

(Einhorn, 1992, p. 25)

(Einhorn 25)

1. Lois J. Einhorn, Abraham Lincoln, the Orator: Penetrating the Lincoln Legend (Westport, CT: Greenwood Press, 1992), 25, http://www.questia.com/read/27419298.

Cited article

Investing in a Sustainable World
Settings

Settings

Typeface
Text size Smaller Larger Reset View mode
Search within

Search within this article

Look up

Look up a word

  • Dictionary
  • Thesaurus
Please submit a word or phrase above.
Print this page

Print this page

Why can't I print more than one page at a time?

Help
Full screen

matching results for page

    Questia reader help

    How to highlight and cite specific passages

    1. Click or tap the first word you want to select.
    2. Click or tap the last word you want to select, and you’ll see everything in between get selected.
    3. You’ll then get a menu of options like creating a highlight or a citation from that passage of text.

    OK, got it!

    Cited passage

    Style
    Citations are available only to our active members.
    Buy instant access to cite pages or passages in MLA, APA and Chicago citation styles.

    "Portraying himself as an honest, ordinary person helped Lincoln identify with his audiences." (Einhorn, 1992, p. 25).

    "Portraying himself as an honest, ordinary person helped Lincoln identify with his audiences." (Einhorn 25)

    "Portraying himself as an honest, ordinary person helped Lincoln identify with his audiences."1

    1. Lois J. Einhorn, Abraham Lincoln, the Orator: Penetrating the Lincoln Legend (Westport, CT: Greenwood Press, 1992), 25, http://www.questia.com/read/27419298.

    Cited passage

    Thanks for trying Questia!

    Please continue trying out our research tools, but please note, full functionality is available only to our active members.

    Your work will be lost once you leave this Web page.

    Buy instant access to save your work.

    Already a member? Log in now.

    Author Advanced search

    Oops!

    An unknown error has occurred. Please click the button below to reload the page. If the problem persists, please try again in a little while.