Author: Peter Cantelon, Executive Director
Is socially responsible, ethical investment profitable? It feels wrong to even ask the question but it is, in fact, a good question to ask.
In a perfect world we would see resources equitably distributed in such a way that all people’s needs (food, shelter, clothing, health, equality, etc.) would be met and opportunity for recreation and self-improvement would be abundant.
However, we do not live in a perfect world and must couch things in terms of living in a “perfecting world…”. What does it mean to live in a perfecting world? It means to live in a word where the intentional momentum is toward social justice, equity, and equality.
To create such a momentum, forces must take into account pre-existing systems and strive to adapt those systems not simply from outside but from within, that they would steer toward that more perfect future we dream of.
These systems include political and economic and they are varied, interconnected and diverse around the world.
Now back to our original question – is socially responsible, ethical investment profitable? Yes, it is because it has to be.
Those who have operated within the space for some time recognize that profitability is measured in many different ways depending upon who or what you are. We recognize that by investing in socially responsible, ethical initiatives there are many intangible benefits such as reduced hunger, reduced poverty, increased health and wellness both physical and mental, affordable housing, job creation and the list goes on.
I wonder if any of you cringed when you saw the phrase “intangible benefits” above? When you see this phrase, it is code for “I cannot directly measure the gross profit from such an investment therefore the benefits are invisible and intangible”.
Of course, when you speak with those who directly benefit from a new affordable childcare space made possible through an ethical investment you will learn just how tangible such a benefit really is.
The good news is that increasingly loud voices bringing environmental, social and governance (ESG) concerns to the forefront have been changing the general public’s priorities when it comes to consumption/purchasing and investing. As this has been happening the market has taken notice and a shift has been happening where we are now seeing not only a recognition of “intangible” value related to social and ethical investment but a financial value as investments are shifting toward these areas.
According to Investing.com “ESG funds globally are expected to continue to grow to about $53 Trillion by 2025, following historical 15% growth rates. The impressive performance of ESG also adds to its notoriety. From the period March 2020-March 2021, 73% of ESG funds have outperformed the S&P 500, many by substantial margins.”
In Manitoba Jubilee Fund has been focused on communicating the value of socially responsible ethical investment for more than 20 years through the sale of investment vehicles like Jubilee Investment Certificates (JICs) which are leveraged to provide financial assistance to organizations implementing poverty-reducing/impacting programming and initiatives.
Over this time Jubilee Fund’s investors have helped to create countless affordable child care spaces and affordable housing units. Jubilee has helped co-operatives create and sustain local business and much more. Every $1 invested in Jubilee Fund equals $4 in social and economic value for the province.
On top of this return investors receive 2 percent less than the standard posted Guaranteed Investment Certificate (GIC) return.
When you consider that socially responsible, ethical investment helps create jobs, housing, improve climate and environment, and increase social equity you can begin to see the value to yourself and neighbours when this is in your community.
Is ethical investment profitable? Absolutely and in ways that will pay dividends for generations to come.
