How has money changed the world

How money changes the world

What actually happens to my money? At least since the beginning of the financial crisis, more and more people have been asking this question. Anyone who not only wants to keep an eye on profits, but also wants to set the economic and social course with their investments, is therefore investing their money sustainably. But within a complex range of sustainable financial services, many investors lack an overview. Research aims to fill this information gap.

"Sustainable investments are financial investments that take ethical, social and ecological criteria into account," explains the head of the Sustainable Business Institute (SBI), Dr. Paschen from Flotow. The demand for such investments has been increasing rapidly for several years: According to the European Sustainable and Responsible Investment Forum (Eurosif), the volume of sustainable funds in Europe has almost doubled since 2008 from 2.7 to five trillion euros. However, the idea of ​​financial transactions based on principles is not entirely new: the first ethical investors were religious communities in the 19th century. The Quakers in particular avoided putting their money in so-called "sin stocks"; “Sin stocks” from companies that dealt in weapons, slaves, alcohol, tobacco, gambling or pornography.

Great variety of investment criteria

The basic principle of formulating exclusion criteria is pursued by many socio-ecological investments to this day - with new taboos such as child labor, human rights violations, nuclear energy and genetic engineering being added. Further options for creating sustainable investment funds are targeted investments in companies from certain sectors (such as wind energy) and the so-called "best in class" approach, which selects the pioneers in matters of sustainability from various sectors - without excluding certain branches of the economy .

The criteria according to which the approximately 200 sustainable investment funds approved in Germany ultimately put together their portfolios is therefore very different. Ecologically and socially oriented investors without previous financial knowledge quickly lose sight of the situation. Therefore, with the support of the Federal Ministry of Education and Research, the SBI has developed an internet platform that is intended to provide clarity. “The most important thing is to create transparency. On the platform, investors can find out about the range and performance of sustainability funds, ”says Dr. Paschen from Flotow.