The goal of sustainability is twofold: to protect the environment while ensuring continued economic growth and prosperity. At first, it may seem counterproductive; how can we continue to support a growing population while maintaining the resources that we have? However, thanks to ever-emerging technologies, this goal can be achieved. We simply need to ensure that sustainability goals are properly funded.
This can be done through what is called green investing. The ultimate goal of green investing is to reduce carbon emissions, waste, and other pollution while conserving natural resources and promoting environmentally conscious business practices. Green investing is also something that’s relatively new and, therefore, has varied definitions, approaches, and it carries an element of risk.
In spite of the risk, green investments seem to be the way of the future. But, what exactly are green investments, and what investments should you make in order to see profitability? Here is a brief guide for green investment beginners.
In short, green investments are investments that support sustainable initiatives and companies. It’s a concept that goes by many names—impact investing, social investments, sustainable investments, eco-friendly investments to name a few—and because it’s relatively new, even experienced investors are working to determine the best approach. That being said, it has been around long enough to show significant yields.
There is no exact definition of what a green investment is. Sometimes, a green investment is simply purchasing stock in a company that makes sustainable choices. You can also invest in a green fund—a mutual fund that only supports environmentally responsible companies—or green bonds which support environmental projects. You can also invest in a credit system that will help your company reach pollution neutrality through funding projects that remove an equivalent amount of pollution from the environment, such as carbon emissions or plastic waste.
Although making a profit is a goal of any investment, green investments are also meant to promote more sustainable living, support businesses that are sustainable, and to encourage other businesses to make sustainable choices. It’s also important to consider when cultivating your own investors; many investors, millennials especially, are only looking to invest in companies that are sustainable. Because of this, companies need to ensure that they have a sustainable business model that works if they want to see investments coming in.
How green investments come back to you
Although green investments have multiple goals—sustainable behavior change, less emissions and pollution, funding of environmental technologies—the ultimate goal of investing is to turn a profit. Before you invest in a green opportunity, you want to make sure that you will benefit from it.
In the end, studies show that green investments may yield a higher profit than traditional investment avenues, but it will take longer to see that profit. In fact, investors who consider themselves to be expert/advanced in investing are now devoting around 42% of their portfolio to sustainable investments, and they are expecting an annual return of 10.9% in one way or another.
There are a few different ways that you see return from green investments.
- If you purchase stock in a sustainable company, you will see the return after the company begins to grow.
- If you purchase green bonds, you will make a profit from the company when they pay back the bond, and you can make additional profit because the bonds are often non-taxable. They are also a popular investment choice for companies that must allot a certain amount of their finances to green assets.
- If you invest in a green fund, essentially a mutual fund that focuses on sustainable companies, you’ll make a profit when the companies that the fund is invested in finds success.
- If you invest in plastic credits, your company will benefit by becoming one of the sustainable companies that people can make a green investment in. Additionally, plastic credits allow companies to meet environmental standards and regulations that may otherwise carry a fine or a fee. According to trends, producers may soon face regulations concerning their sustainability practices, and companies that have not taken important steps in order to adopt sustainable business models will likely see fines and other regulations for unsustainable practices.
Beyond the direct profit potential of green investments, these types of investments can also help build your customer base and improve your marketing strategy. When your customers see that you are investing in green projects, they are more likely to support your company, whether through their patronage or through investing. Sustainability is becoming important for both consumers and governments. Sustainable investing isn’t just good for your company, but it will become imperative in the coming years if you want to avoid customer loss and regulatory fines.
How can TONTOTON’s plastic credits be a financial tool?
Although plastic credits aren’t a traditional method of investment—any monetary yield is not a direct one—you will see benefits that could result in profit as a result of your plastic credits.
Sustainability in business isn’t just something that you should pursue. Due to changing public perception and regulation practices, it’s something that your company must adopt in order to survive. Sustainable practices rank among the most important considerations that customers make when choosing companies to support, and current trends suggest that responsibility for waste management and emissions will fall to producers. This means that, in the near future, companies will see serious repercussions if they are unable to maintain sustainable practices.
When you invest in plastic credits through TONTOTON, your company is able to achieve plastic neutrality by funding projects that eliminate an equal amount of plastic from the environment as your company produces. This is a short term solution that allows your company to address your plastic waste immediately while making strategies in order to reduce the plastic waste that your company produces.
Purchasing plastic credits through TONTOTON isn’t just a good environmental choice; our projects support local waste pickers and households within the communities where we work, empowering locals to collect plastic waste while providing an additional income so that they can better support their families. Our plastic credits are both environmentally and socially responsible, making it a win for all.
Green investments may not seem like they have a large potential for profit, but there are many ways that you can benefit from this type of investing. In fact, it may be the future of investing.