Sustainability incorporates a triple bottom line of People, Planet & Profit. There's a certain interconnectedness with the triple bottom line approach, where success in any one of the three pillars has the potential to help drive success in the others. The moment you begin making moves to be sustainable in one, you'll generally begin becoming more sustainable in the others.
When you solve one problem by practising sustainability you’ll find that you solve ten other problems. Everything interrelates to each other.
In a workplace, for example, if you replace all your light globes with low-powered LED bulbs, you'll not only reduce your carbon footprint, you'll also save a substantial amount of money.
Being sustainable is not just about sustaining the environment. It’s also about economic stability, ensuring that the businesses who incorporate sustainable principles and strategies stand the test of time because of these things.
Until recently, financial performance has been the main parameter when evaluating how good a company is. Return on Investment (ROI) has driven investment behaviour for decades. The new economy, however, is demanding more than just financial performance. It's also demanding social and environmental accountability.
Earlier this year you may have seen a report that I shared on behalf of MSCI on the top ESG trends for 2018. This report identified one of the top trends as investor demand for greater disclosure around sustainability.
I am definitely seeing this trend unfold in the industry. One issue of non-disclosure is stranded asset risk.
Stranded assets are investments that are not able to meet a viable economic return and which are likely to see their economic life curtailed due to a combination of technology, regulatory and/or market changes.
As the world moves towards a low carbon economy, experts have warned of a ‘carbon bubble‘ caused by fossil fuel companies and their assets being overvalued and stranded.
The risk naturally flows from carbon-intensive business to the investors who hold shares in those companies. This includes our superannuation funds, most of which have been supporting the fossil fuel industry for years. This poses a huge threat to the retirement savings of thousands of people
Here's what you can do to determine what level of exposure you have to stranded asset risk:
Go to the superannuation/investment fund manager’s website (Google the name of the company to find this).
Search for your particular investment option.
The fund’s Quarterly Report should be available on the website, listing its major holdings. This might be a separate web page or a PDF.
While superannuation funds are legally required to disclose major holdings in their quarterly reports, (which has only recently been made law) it doesn’t necessarily follow that the information is always easy to find online.
So, if you don't have the time to check on this, we can do it for you during our FREE Discovery Session.
During the Discovery Session you will receive:
A personalised Sustainability Report
Greater clarity to your current situation and the savings you can make
A roadmap of what options you have to give you a better outcome with your own Triple Bottom Line!
Click on the link below to make an appointment