Investing for good

We don't think there needs to be a trade-off

The world is facing huge challenges. If we want the world to be a better place for the next generation, we need to face up to these challenges today.

Each of us can take action through our everyday choices whether travelling more by public transport, recycling, reducing the amount of water we use – we can make a small difference.

But did you know that your money can make an even bigger difference? The way we put our long term savings to work can play a big role in shaping the world around us.

Your money could be investing in companies that are working to solve the world’s biggest environmental and social challenges; companies that develop vaccines, generate renewable energy, tackle inequality, companies that build affordable homes, manufacture electric cars, and provide clean water.

By investing in companies and industries that are looking to fix some of the world’s greatest problems, your money has the potential to grow whilst helping to fix the planet.

That’s why millions of people across the world are investing in this way, for a better future for people and the planet.

How does investing for good work?

Investment experts use a range of factors to decide where to invest.  One of the things that is considered when selecting investments is whether they do any harm to the planet.  Investments are screened and some don’t make it through the first filter like controversial weapons.

As well as the potential for returns, experts also look at three important areas;

  • Environmental factors – for example levels of carbon emissions produced
  • Things that help society – for example fair working conditions
  • Companies with robust controls (governance) for example, ensuring a diversified and inclusive working environment

These are known as ESG (Environmental, Social and Governance) considerations.

Working together to create a better planet

The United Nations have a number of goals which highlight the world’s biggest problems. Goals to combat things such as poverty, famine, and gender inequality. Governments and companies all over the world are signing up with the drive and ambition to meet these goals and help solve the issues facing our planet. Many funds that invest for good can be matched up against one or more of these goals and have specific targets in helping to meet these goals. A number of factors are then used to measure the positive outcomes the investment has made for society and the planet. For example, the positive outcomes of a renewable energy company could be measured by looking at the level of carbon emissions. By analysing this over the longer term we can see the good and positive change the investment is having.

Investing for good isn’t new and lots of people are doing it

When you invest money, you want it to have the chance to grow. And more and more people also want to make sure their investments do no harm - to people or to the planet.

Your money can be used to invest in companies helping to solve global challenges and contributing towards a healthier planet.

Companies that develop carbon capture technology, reduce plastic pollution, build transport links around the world, and give more children access to education; companies that create and innovate for a better future.

Companies in these areas have the potential to grow, and more opportunity for growth means more opportunity for returns. As they succeed and grow, they could help your money grow too.

That’s why there’s more than US$35.3 trillion invested* in this way around the world.

*Global Impact Investing Networks Annual Impact Investor Survey 2020

Explore our fund ranges

PruFund Planet Range

PruFund Risk Managed Range

Sustainable Multi Asset Range

Looking to invest in a planet-friendly pension?

If you’re interested in the future of your pension and helping the planet, financial advice can make a real difference. If you already have a financial adviser, please speak to them directly. If you don’t have an adviser, we can help. You can book a no obligation financial review with one of our advisers. We offer a restricted advice service.

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