The term “green,” can be somewhat vague. When people talk about “green investments,” they’re speaking generally of investing in activities that can be considered good for the environment directly or indirectly. In this context, green investing refers to investing activities that promote environmentally friendly business practices and the conservation of natural resources.
Green investments are often associated with socially responsible investing (SRI), which is an investment process that considers social and environmental factors within the context of traditional quantitative securities and investment analysis.
Environmental, Social and Governance
The measurement of the sustainability of an investment is based on ESG. ESG stands for Environmental, Social and Governance. It was derived from the ‘Triple Bottom Line’, also known as the ‘People, Planet and Profits’ (PPP), a concept introduced in the 1990s. It argued that businesses should focus on each of the three ‘P’s and not just on profits, since they were equally important for any commercial enterprise to be sustainable. This concept evolved into the focus of ESG, which today is the bedrock of SRI.
The EU Legislation
The EU sustainability legislation is a taxonomy that defines what is green. The taxonomy sets four overarching conditions that an economic activity must meet to qualify as sustainable. It has to contribute to at least one of six environmental objectives: climate change mitigation; climate change adaptation; sustainable use and protection of water and marine resources; transition to a circular economy; pollution prevention and control; and protection and restoration of biodiversity and ecosystems.
The Green Economy Mark
The London Stock Exchange Group is a global hub for sustainable finance. It introduced a Green Economy Mark in 2019, which recognises listed companies and funds which derive 50% or more of their revenues from environmental solutions. With a growing proportion of asset owners and managers seeking to deploy capital into sustainable investments, the Mark presents an investible universe of ‘green economy’ equities, enabling a broad exposure, rather than a focus on one area.
Investment in a Green Economy Mark company
Crowd for Angels has invested £225,000 in Verditek Plc, a company listed on the AIM market of the London Stock Exchange (LSE). Verditek (VDTK) had a market capitalisation cap of £10.9 million as of 28/05/2021 and has been awarded the Green Economy Mark by the LSE. The investment is through a 7% Secured Bond with a two year term.
Verditek is raising £500,000 on the Crowd for Angels’ platform on the same terms. Check https://crowdforangels.com/company/plc/verditek-plc-1054
Capital at risk. Tax relief subject to circumstances and change. No FSCS.