Alternative Energy: A Perfect Way to Be Socially Responsible With Your Investments
Socially responsible investing (SRI) is a strategy to make your investments more impactful by supporting ecological and social causes. SRI investors invest their money to support companies that value transparency in their business practices and are committed to positive social and environmental impacts. Environmental, social and corporate governance (ESG) are the cornerstones of socially responsible companies. Companies that support ESG practices value human rights and produce environmentally safe and sustainable products like alternative energies.
What is ESG?
SRI investors aren't merely selfless and charitable. They still seek a positive return on investment. However, they believe that they can use those investments for the betterment of our world. Companies that use ESG guidelines have a history or mission to support the same values that SRI investors have.
- Environmental - Examples of environmentally-focused companies are those that are developing sustainable agriculture practices, clean technology or offsetting the carbon footprint.
- Social - Socially focused companies work to implement fair and inclusive workplace practices, support human rights issues and community development.
- Corporate Governance - SRI investors also look for companies that focus on transparency in political contributions, executive compensation and board independence.
What Are Alternative Energies?
Alternative energies are those that do not deplete natural resources, are environmentally safe and renewable. There are several options for renewable energy, and some are closer to being a viable alternative than others. Sources of alternative energies are wind, water, sun, geothermal, biomass and biofuels. SRI investors seek to make their money move the dial on making alternative energy a reality.
Solar power is one of the alternative energy sources that even individuals have fairly widespread access to and familiarity with for both their homes and businesses using solar panels. While the initial investment is relatively expensive, it can pay for itself as compared with the high cost of utility companies. Solar PV systems capture and convert the power of the sun to use for electronic devices. Solar thermal panels are used to heat water for showers, etc.
The power of water generates one of the oldest methods of creating energy. It is a non-polluting and renewable source of power. Typically, water in dams is run through turbines to produce energy. There is another benefit from the dams that contain the turbines: they are also used for flood control and irrigation.
Another use of water for power is to use naturally heated water. "Geo" is Greek for earth. Geothermal energy is heated by the earth and is renewable by rainfall, springs and the natural heat of the planet. Heat is generated by the earth and warms fluid-filled tubes buried in the ground. That heat can be pumped into buildings by ground source or geothermal heat pumps.
Wind energy, while renewable and non-polluting, has been somewhat controversial in recent years. Wind farms that use huge turbines to generate electricity faced resistance from neighbors and animal activists. The protestors claimed that the turbines blocked or restricted scenic views. Some claimed that they were unsafe for large birds.
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