10.2 Different Reasons for Sustainable Investing

Investors choose sustainable financial products for various reasons, with personal values often playing a key role. Investment funds that exclude certain sectors and activities or focus on particularly sustainable companies are popular in this regard. Another motivation is risk avoidance and exploring new growth opportunities (i.e., financial interests). The broad integration of sustainability factors into financial analysis serves the former goal, while thematic investments in growth sectors address the latter. In recent years, the focus has increasingly shifted toward how investments can contribute to tangible change. Investor stewardship (i.e., engaging in dialog with companies and actively exercising voting rights) is one potential way to make a positive impact. Another is to provide fresh capital to companies that offer specific solutions. What is clear is that different sustainable investment approaches are applied for different motives – especially since not all of them can meet every objective. This presents a significant challenge for providers: In communications about sustainable investments, these goals are often not differentiated clearly enough, which has, in some cases, led to exaggerated claims – for instance, regarding the impact of the investments or the portfolio composition. Against this backdrop, accusations of greenwashing have become increasingly common.