Sugi helps you understand the environmental impact of your investments. But what does this mean and why does it matter?

From shopping, cars and flights…to investments

You’re probably familiar with the idea of carbon emissions from your shopping, your trips in a car and the flights you take. Similarly, there are carbon emissions associated with the companies you have invested in. What we refer to as a company’s carbon impact.

Each company has its own carbon impact – from its business activities, electricity use, supply chain and customer behaviour. It also has a water, deforestation, and pollution impact. It's a complex mix of factors that determines which companies are considered greener than others.

Taking responsibility for your investments

As a shareholder in a public company, you’re one of its owners. And while you might not be involved in the company’s decisions about its energy provider or the raw materials it sources, you’re technically in control. Your shareholding gives the company its status, its value, its position in the market.

It’s on this basis that Sugi allocates you an amount of your investment’s carbon impact in proportion to your shareholding. And as the app develops, we'll also allocate other types of impact to your investments.

Maybe you’re wondering how this applies to funds or ETFs. Put simply, the impact of a fund or ETF is the impact of the companies that make up the fund. Which is why it’s important to understand how an ETF chooses its stocks.

And what about bonds? Since bonds are debt, rather than equities, you don’t become an owner of a company by holding a bond and you don’t have responsibility for the company. For this reason, we don’t include bonds in our impact calculations or allocate you any impact for your bond holdings.

So that’s why you have a personal impact for your investments.

The bigger picture

You may be one person. But all of us investors together represent a lot of private money.

By investing in companies that take positive action to reduce their impact, and by moving money away from polluting companies, we’re sending an important message: the market wants green. With enough force, we can make the pendulum swing.

The global market for impact investing is $30.7 trillion, with 107% annual growth in assets under management since 2012. *

The green revolution is here. But there’s a long way to go.

So engage with green investing. The Sugi app is here to help you build a greener portfolio.


* References
https://www.bloomberg.com/news/articles/2019-04-01/global-sustainable-investments-rise-34-percent-to-30-7-trillion

http://www.ussif.org/Files/Publications/SIF_Trends_14.F.ES.pdf