Archive for February 19, 2007


Environment : A Market or an Idea

Filed under: Green Strategy by Suhit Anantula — Leave a comment
February 19, 2007

Andrew Winston over at Eco-Advantage asks a very important question: how to think about the environment as a business opportunity. Is it a market like any other…one you can “size” by revenues, or profile the competitors? Or is it an idea, a theme shaping business?

Take another ‘market’/business changing theme: information technology. I can size the market for Internet or software companies. But does that give a sense of the role of info-tech in our economy? After all, FedEx is arguably one of the most successful implementations of info-tech thinking ever. Everyone uses info-tech in some way.

I think “environment” is quickly becoming something thematic: a way of thinking about how business is conducted at a fundamental level…not a particular market called “eco-products” or “greening the supply chain,” but all products and all supply chains.

In the near future, there is no “eco-product,” there’s just product.

It’s a paradigm shift like we’ve never seen. It sounds like hyperbole, but it’s seeming more and more real every day.

This is important to understand because even though you will have individual markets for eco-services, eco-products which are new and create a new market there is this theme of “green” which needs to be part of each and every market.

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Socially Responsible Investing: Myth vs. Reality

Filed under: Green Finance by Suhit Anantula — Leave a comment
February 19, 2007

Harry Moran writes about the myths in Socially responsible investing on GreenBiz.com.

Those who attended business school anytime in the past 40 years emerged with a concept etched on the most resilient part of our brains which forms the basis for the mother of all investment myths-that limiting the investment universe will limit the potential for investment return.

With virtually any active management strategy, the question is whether the investments being chosen (or eliminated) for economic, financial, social, or environmental reasons are likely to enhance returns or reduce risk.

The limited investment universe myth leads directly to the myth of underperformance. Fortunately, there is a significant body of empirical evidence that shows a clear and measurable link between intangible environmental, social, and governance factors (ESG) and bottom line financial performance.

The most ironic of all myths is wrapped in the belief that socially conscious investors are anti-capitalism. On the contrary, as owners of stocks, bonds and mutual funds, we are heavily invested in the market-based capitalist system.

Another persistent myth: it’s better to invest for maximum profit and then donate some of those profits to help organizations doing good work. Tell me, is a strategy of investing in a company with egregious environmental problems and then donating some of the profits to environmental causes more or less effective than withholding capital and working to improve the company’s environmental impact?

Even the largest companies run the risk of becoming extinct if they cannot adapt to a changing market environment.

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