I went to an interesting seminar last night hosted by David Blood. He's recently set up Generation Investment Management with Al Gore to focus on sustainable investing.
I hadn't appreciated the difference between socially responsible investing (investing in important projects that may not have an appropriate economic return) and sustainable investing (investing for the long term in projects or assets that think carefully about their environmental, social and geopolitical impact).
I had a few minutes of feeling disappointed: I'd thought that this was a form of corporate altruism that would invest in worthy projects, but found it was 'just' an investment management philosophy. But I was soon really intrigued.
In a world that is becoming flatter, Generation indicates that the capital markets are starting to respond to the fact that we are increasingly inter-connected. Their belief is that over the long run companies who think holistically about their activities, and their impact on the planet, will generate superior financial returns. If they can also attract money from investors who are starting to become concerned by the same issues then a virtuous circle can be created.
Given that capitalism has won, this is a nascent but really hopeful development. It may be the start of a tangible economic incentives to save the planet which could really work.
The event was partly organised by the HBS London chapter, but also by a group I'd never heard of: NetImpact . I know that all this is fashionably zeitgeisty at the moment, but it's encouraging all the same.
