IS HARD FOR SA INVESTORS
Angelique Ruzicka offers advice for investing in green companies or funds that embrace prudent ESG principles
4Sharia funds are investments governed by guidelines under Islamic law. According to sharia law, non-permissible investments include those made into businesses which offer interestbased money-lending transactions; conventional insurance; embryonic or stem cell research and cloning; gambling; non-halaal meat; and nightclubs.
These values may be in line with your own, and the good news is that you generally do not have to be Muslim to invest in these funds.
5CONSIDER ALTERNATIVE INVESTMENTS Some renewable energy companies may not be listed on the JSE, so investing in them could prove difficult. If you have the collateral, you could consider alternative investment funds.
So, should you let your beliefs guide your investment decisions?
Maguire says that, besides reducing your risk, investors should look at impact investing because they can improve performance and have become more socially acceptable. “International share price experience shows us that firms that have the best social and environmental governance practices also tend to manage their businesses best, manage their workforce better and outperform other less responsive firms,” he adds.
ESG values will be something that will need to be embraced in the future, particularly considering the fact that we live in a country where water is scarce, electricity is unreliable and climate change is real. “In an environment where the investor can get a competitive return while also doing good, the social acceptability of investing solely for returns is rapidly drying up,” says Maguire.