Earth Day is celebrated annually on April 22 to demonstrate support for environmental protection. First held on April 22, 1970, it now includes a wide range of events coordinated globally by earthday.org (formerly Earth Day Network) including 1 billion people in more than 193 countries. This year’s Earth Day theme is ‘Invest in Our Planet’ and is designed to persuade businesses, governments, and citizens around the world of the need to invest in our planet to improve our environment and give our descendants a better and safer future.
One way to ‘Invest in Our Planet’ is by harnessing the power of investments to combat climate change. A November 2021 Gallup poll described the concept of sustainable investing as one that involves “choosing investments based on the effect they have on things like the environment, human rights, diversity and other social values, in addition to investment returns.” After reading the survey’s description of sustainable investing, 48% of investors say they are very or somewhat interested in purchasing sustainable investing funds.
With much discord and politicization over the last year toward Environmental, Social, and Governance (ESG) investing, it is important to point out that there are ways to have a positive impact on climate change through investments. For instance, there are equity funds that invest in companies looking to provide environmental solutions; REITs providing capital to companies involved in energy efficiency, renewable energy, and other sustainable infrastructure markets; and private equity firms with a focus on clean energy, cleantech, and climate change.
There are also bonds that may be labeled “green” or may not even have a “green” label but are financing multifamily properties incorporating sustainable features like solar panels or initiatives such as renewable energy projects and technology for climate action. In our opinion, a clear use of proceeds is key to any labeling with environmental impact(s).
Finding positively impactful climate-focused investments supporting clean energy solutions and other environmental initiatives will continue to expand especially as the number of mutual funds and exchange-traded funds with climate-related mandates continues to grow. This upcoming Earth Day serves as a great reminder that finding ways to positively ‘Invest in Our Planet’ can come in a variety of forms, one being through your, or your organizations,’ investments.